macro ch 1 quiz questions
Which would not be considered as capital by an economist?
A share of corporate stock issued by General Motors
When an economy is at full employment and full production, more of any one product:
can be produced only if there is less production of some other products.
The "war on terror" waged by the United States
caused the perceived marginal benefit curve for "defense goods" to shift out.
The term "scarcity" in economics can refer to the fact that
no country can produce enough products to satisfy everybody's economic wants.
If the marginal benefits of the output from resources devoted to the production of a product are greater than the marginal costs, then there has been an overallocation of resources to the production of that product.
true
Henry wants to buy a book. The economic perspective suggests that Henry will buy the book if
the marginal benefit of the book is greater than its marginal
Macroeconomics is the study of economics from the standpoint of
the overall economy.
The process of developing hypotheses, testing them against facts, and using the results to construct theories is called
the scientific method
Assume that for Indy, one hour of study time in economics is perfectly substitutable for an hour of study time in calculus. Indy has exams in both subjects tomorrow and he determines that if he spends all of his time studying economics, he will receive scores of 96 on his economics exam and 45 on his calculus exam. If he studies only calculus, his economics score will be 81 and his calculus score will be 90. Based on this information and assuming that Indy has no better alternative use of his time, what is the opportunity cost of improving his economics score by one (1) point?
3 points on his calculus exam
What is the economic meaning of the expression that "there is no such thing as a free lunch"?
It means there is an opportunity cost when resources are used to provide "free" products.
Which is not considered to be an economic resource?
Money
Are the goods that businesses offer for "free" to consumers also free to society?
No, because society does not assign a value to free goods.
Which of the following is not a central focus of the "economic perspective"?
The scientific method
Which expression is another way of saying "marginal cost"?
additional cost
A basic assumption used in most economic theories is that
all other things remain the same.
Money is not considered to be an economic resource because
as such it is not productive
An economic model is
built using theory.
Along a production possibilities curve, an increase in the production of one type of good can be accomplished only by
decreasing the production of the other type of good.
On a production possibilities curve, the optimal or best combination of output for any society:
depends upon the preferences of society.
Economic resources in the capitalist system are brought together by
entrepreneurs.
A point inside the production possibilities curve illustrates that resources are not being used as efficiently as possible.
false
Society wants to use its scarce resources efficiently. To achieve this economic goal it must
have full employment and full production.
A nation can increase its production possibilities by:
improving labor productivity.
As a consequence of the condition of scarcity
individuals and communities have to make choices from among alternatives.
The production possibility curve
is the boundary between attainable and unattainable outputs.
The basic economic problem is essentially one of deciding how to make the best use of:
limited resources to satisfy unlimited economic wants.
The production possibilities curve bows outward from the origin because
opportunity costs increase as the production of a good increases.
If a production possibilities boundary is a curve concave to the origin and not a straight line, then
resources are not equally suited to producing alternative products.
Economic growth may be represented by a
rightward shift of the production possibilities curve.