Macroeconomics Test 1

land labor capital entrepreneurship

what are considered factors of production?

provides a positive incentive because it rewards ppl for recycling

a five cent deposit on beer bottles: -provides a positive incentive because it rewards ppl for recycling -provides a negative incentive bc it punishes ppl who don't recycle -is an irrational policy, fails to take into account incentives -is an irrational policy, fails to take into account self interest

macroeconomics

a friend wants to learn how the unemployment rate is calculated and how inflation is measured. he asks you which economics course to take. you advise him to enroll in: -macroeconomics -microeconomics -either micro or macro -financial accounting

analyze how choices are made

a fundamental aspect of economics is to: -ensure that every firm makes a profit -analyze how choices are made -satisfy all our wants -make sure that our resources will always be unlimited

production possibilities curve

a graphical representation which shows the trade-off that occurs when more of one output is obtained at the sacrifice of another is called: -a laffer curve -production possibilities curve -bell curve -supply curve

the effect of a change in income taxes on the nations rate of unemployment

a microeconomist would study all of the following except: -the impact of a change in consumer income on the sales of corn -the impact of a snowstorm on the sales of snow shovels -the most efficient means for GM to produce a car -the effect of a change in income taxes on the nations rate of unemployment

resources are being used efficiently

a point on the ppc indicates: -resources are not being used efficiently -resources are being used efficiently -opportunity costs are constant -an output combo that can be attained only if society gets more resources or there is technological change

is currently not attainable

a production point that lies outside the ppc: -denotes inefficiency -indicates unemployment -is currently not attainable -can never be reached, even in future periods

inefficiency in production

all points inside the ppc indicate: -a lack of sufficient supply -inefficiency in production -the law of increasing relative cost -the law of decreasing relative cost

increases the supply of fast food meals

an increase in the number of fast foods chains: -raises the price of fast food meals -increases the demand for fast food meals -increases the supply of fast food meals -increases the demand for substitutes for fast food meals -increases both the demand and supply of fast food meals

movement along the demand curve

an increase in the quantity demanded is shown as: -movement along the demand curve -movement toward the demand curve -rightward shift of the demand curve -leftward shift of the demand curve -both a movement along the demand curve and a shift of the demand curve

total

another word for aggregate is:

200 yards of cloth

between points b and c in the above figure (first pic), the opportunity cost of 250 more bushels of corn is: -200 yards of cloth -250 yards of cloth -600 yards of cloth -800 yards of cloth

are used to explain how ppl behave

economic models: -are used to explain how ppl think -are used to explain how ppl behave -are essentially representations of the real world -are never used to make economic predictions

limited unlimited

economics can be described as the study of how people use _______ resources to satisfy _______ wants.

how individuals allocate scarce resources to satisfy unlimited human wants

economics deals with: -how to earn a profit from the stock mrkt -how to satisfy limited human wants -how society allocates unlimited resources -how indivs. allocate scarce resources to satisfy unlimited human wants

self interest

economists assume people are motivated by: -unlimited resources -pride -self interest -social justice

supply of memory chips increases

if the number of companies producing computer memory chips increases, then the: -supply of memory chips does not change -supply of memory chips increases -supply of memory chips decreases -quantity of memory chips supplied increases -demand for memory chips increases

resources wants

in economics, _____ are limited but _____ are unlimited.

resources

in economics, items that are used to produce goods and services are known as:

an increase in the price of soda, a complement to pizza

in the above figure (3), the shift in the demand curve from D to D2 can be the result of: -an increase in income if pizza is a normal good -an increase in the price of a sub sandwich, sub for pizza -an increase in the price of soda, a complement of pizza -a change in quantity demanded -a decrease in the supply of pizza that raises the price of pizza

decrease in the price of pizza

in the above figure (3rd pic), the movement from point a to point b reflects: -decrease in the price of pizza -an increase in the demand for pizza -an increase in the number of ppl who eat pizza -a decrease in the number of firms producing pizza

a

in the above figure, which of the following points indicates the efficient use of resources? *first pic -a -f -g -h

an increase in the price of a sub sandwich, a sub for pizza

in the above figure,(3rd) the shift in the demand curve from D to D1 can be the result of: -an increase in the price of pizza -an increase in the price of a sub sandwich, a sub for pizza -an increase in the price of soda, a ​complement to pizza - a change in the quantity demanded

economy wide choices choices of individuals

macro deals with _____ while micro deals with _______ -choices important to ppl, choices not important to ppl -economy wide choices, choices of individuals -choices that involve money, choices that don't involve money

macro is the study of the behavior of the economy as a whole

macro is best defined by which statement? -macro is the study of how firms strive to maximize their profits -macro is the study of the behavior of the economy as a whole -macro is the study of how indiv. economic units -macro is the study of how the prices of indiv. goods are determined

studies individual decision making by households and firms

microeconomics is defined as that part of the economic analysis that: -studies behavior of the economy as a whole -includes the probs of inflation and unemployment -studies individual decision making by households and firms -concerns aggregate production and consumption

giving up employment possibilities while in college

one opportunity cost associated with going to college is: -purchasing textbooks -paying tuition -giving up employment possibilities while in college -paying for room, board, and other living expenses

a model helps us to understand, explain, and predict economic things in the real world

one reason economists often use models in their analysis is that: -a model helps us to understand, explain, and predict economic things in the real world -a model accurately pictures every detail of the real world economy -a model relates to indiv. thought processes rather than behavior -is relatively easy to perfectly specify a model

the value of the next best alternative that must be sacrificed to satisfy a want

opportunity cost is: -the cost of producing all g/s in the us -the value of the next best alternative that must be sacrificed to satisfy a want -the fixed cost of production -the value of the most useful alternative that must be sacrificed to obtain something or satisfy a want

by calculating their individual costs and benefits and determining which is greater

people respond to incentives: -by ignoring negative incentives and responding to positive incentives only -only when they are irrational -by calculating their individual costs and benefits and determining which is greater -when they have low incomes

a decrease in income

pizza is a normal good. in above figure (3), the shift in the demand curve from D to D2 can be the result of: -a decrease in the price of soda, complement of pizza -an increase in the price of hamburgers, a sub for pizza -a decrease in income -a study that shows that pizza is a very healthy food -an increase in the cost of producing pizza

point a is inefficient, point b is efficient, point c is unobtainable

refer to the above figure (2nd pic). which statement is true? -point a is efficient, point b is efficient, point c is inefficient -point a is unobtainable, point b is efficient, point c is ineffiecient -point a is inefficient, point b is efficient, point c is unobtainable -all points are efficient

limited resources and unlimited wants

the basic economic problem is the situation of: -limited resources and unlimited wants -both limited resources and limited wants -limited incomes and unlimited choices -unlimited incomes and limited choices

production

the conversion of resources into consumer goods/services is called: -human capital -production -opportunity cost -absolute advantage

all

the issues that an economic system attempts to solve include: -what to produce -how to produce -for whom items are produced -all of the above

if the price of a good increases, the quantity supplied increases

the law of supply states that, other things remaining the same, -demand increases when supply increases -if the price of a good increases, firms buy less of it -if the price of a good increases, the quantity supplied increases -as ppls income increase, the supply of goods increases -if the price of a good increases, the supply increases

the less society can consume in the future

the more society consumes today: -the more it consumes next year -the harder it will be to consume less in the future bc ppl will find it hard to adjust to less -the less society can consume in the future -the easier it will be to consume less in the future

incentives

the potential rewards that are available to an individual if a particular activity is undertaken are known as: -premiums -gifts -incentives -intrinsic values

the quantity demanded of cotton clothing increases

the price of cotton clothing falls, as a result: -the quantity demanded of cotton clothing increases -the demand for cotton clothing increases -the quantity demanded of cotton clothing decreases -the demand for cotton clothing decreases -both the demand for cotton clothing increases and the quantity demand of cotton clothing increases.

production of both corn and cloth is characterized by increasing costs

the shape of the ppc in the above figure indicates that: *first pic -production of corn is characterized by increasing costs while the production of cloth is characterized by decreasing costs -production of both corn and cloth is characterized by increasing costs -production of both corn and cloth is characterized by constant costs -production of corn is characterized by constant costs and the production of cloth is characterized by increasing costs

micro

the study of an individuals choice about what type of computer to buy is a subject of: -macro -micro -an aggregate concept -not a concern for economic analysis

an economic system

the way that a society uses to allocate resources to satisfy human wants is called: -an economic system -an assumption -realism -a physical science

individuals act as if they were rational

when studying individual's economic behavior, economists assume that: -indiv. understand the rationale for all their choices -indiv. act as if they were rational -only educated ppl act as if they were rational -self interest is of limited relevance in predicting an indiv's actions

that society can consume more in the future

whenever a society forgoes current consumption to invest in capital goods: -it will have less to consume next year -it will be easier for that society to consume less in the future bc ppl will become accustomed to less -that society can consume more in the future -it will be forced to produce fewer capital goods in the future

society is giving up current consumption

whenever productive resources are used to make capital goods: -society is not producing efficiently -society is giving up current consumption -the PPC becomes flatter -absolute advantage occurs

a decrease in the price of a resource used to produce gas

which of the following increases the supply of gas? -a situation where the quantity of gas demanded exceeds the quantity supplied -an increase in the price of gas -a decrease in the price of a resource used to produce gas -a decrease in the demand for gas-guzzling, sport utility vehicles -an increase in income if gas-guzzling, sport utility vehicles are a normal good