ECON 2302 Ch 2 Quiz

An entrepenuer's profit is determined by ____.

how useful their product is

In the graph above, the point D represents values resulting in ____________.

unemployment

Please match the following key terms with their definitions.

- Human work A. Labor - All natural resources B. Land -Money to fund business ventures C.Financial capital -Using land, labor, and capital to turn an idea into a useful product D.Entrepreneurship - Tools, machinery E. Physical capital -Skills, abilities, and networking connections F. Human capital

Please match the following key terms with their definitions.

- a point on the PPC A. efficiency - a point beyond the curve B. unattainable (with current resources and technology) - a point inside the curve C. inefficiency -shifting the PPC to the right (or outward) D. economic growth

What is the benefit of moving from B back to A? incorrect 4 units of clothing

3 computers

What is the opportunity cost of moving from B to C?

4 computers

Who suggested that the economy is guided by an "invisible hand" as people are motivated by their self-interests?

Adam Smith

Cost-benefit analysis has the following characteristics:

All of the above are correct

The goal of socialist economies is to:

Create equal outcomes through the redistribution of income/wealth

In the graph above, the point _______ represents values resulting in unemployment.

D

Producing a combination of goods represented by a point on the PPC is:

Efficient and attainable

Barack Obama has stated that community college should be as "free and universal" as high school. In the US, high school is currently free.

False

If you won tickets to see the Mavericks play this Friday night, attending this event is free for you

False

Socialist economies emphasize the equal treatment of people in order to achieve equal outcomes.

False

Producing a combination of goods represented by a point inside the PPC is:

Inefficient and attainable

Scarcity:

Is caused by having an unlimited amount of wants and needs and a limited amount of resources available to satisfy them.

Joe chooses to watch a 2-hour movie on local TV instead of taking a 2-hour walk in the park. Opportunity cost of this decision to Joe:

Is the forgone exercise and enjoyment of the walk

______ wrote this in his influential book, "To each according to his need, from each according to his ability."

Karl Marx

____________ argued that capitalism would lead to socialism and then to communism as armies of unemployed workers would force economic change.

Karl Marx

Which of the following is the best example of human capital?

Knowledge of Microsoft Excel.

You should continue to engage in an activity if:

MB>MC

___________ economics led to the creation of the communist state in Russia, Cuba, and other nations.

Marxist

Rational decision-making implies that you will elect to use your resources to acquire a product that is

More valuable to you than its alternatives

A production possibilities curve for two goods is usually bowed outward because:

Resources are not equally suited to produce each of the two products being analyzed.

When economists study the behavior of sellers, they study:

Supply

According to capitalists, profit is a measure of well an entrepreneur creates value for consumers.

True

Bowed-out PPCs obtain their shape from the production of products that demonstrate increasing opportunity costs.

True

Even Bill Gates, the richest man in the world, faces the problem of scarcity.

True

Karl Marx believed that profit was another word for "theft."

True

Marxism claims that there is always one group of "oppressors" (the Bourgeois) who "oppress" another group (the Proletariat).

True

The 4 questions of allocation are: what to produce, how to produce, who to produce for, and if we are maximizing efficiency and power.

True

Workers formed unions and eventually these were recognized as a legal entity having the right of _________________ .

collective bargaining

__________ efficiency is gaining the most output to maximize consumer utility with a given amount of input.

economic

The ability of people to conceive an idea (innovate), bring together resources, and take the risk when starting a business are all part of ________________ .

entreprenuership

Entrepreneurship involves risk-taking because it involves the possible loss of ____. incorrect: money

physical capital?

A shift in a PPC/PPF to the______________ illustrates economic growth which may be generated by better utilizing existing resources (improved Technology) or by acquiring more resources over time.

right (or outward)

Economics is a _____ that studies how ______ in light of the fact that _______ always exist(s).

social science; people make decisions; scarcity