Exam 1 macro

When you think of an arrangement or institution that brings buyers and sellers of a good or a service together, what are you thinking of?

A market

Which of the following describes the two goods that are subsitutes?

As the price of one of the goods increases the demand for the other good increases

In which markets are factors of production, such as labor, capital, natural resources, and entrepreneurail ability traded?

Factor markets

Economics is the study of all the following except

How to eliminate scarcity with new ideas and inventions

Which of the following covers the study of topics such as inflation and unemployment?

Macroeconomics

Fill in the blank: ________ is the study of how households and buisnesses make choices, how they interact in markets, and how the government influences their choices.

Microeconomics

Which of the following statements best defines scarcity?

Scarcity is a situation in which unlimited wants exceed the limited resources availiable to fulfill those wants

What happens if a country produces a combination of goods that uses all of the resources availiable in the economy?

The country is operating on its production possibilites frontier

Which of the following statements is most consistent with the principle about the basis for international trade?

The united states would be better off if it specialized in the production of some goods, and then traded some of them to other countries

In economics, how do rational people behave?

They decide on an action only if its benefits outweigh its cost

Fill in the blanks. The slope of a straight line equals the change in value on the ____ axis ____ by the change in the value on the other axis between any two points on the line.

Vertical; divided

Which of the following is NOT among the fundamental economic questions taht every society must solve?

What goods and services will be exchanged

Which of the following would not shift the demand curve for a good or service?

a change in the price of the good or service

Which of the following is the correct definition of demand curve?

a curve that shows the relationship between the price of a product and the quanitity of the product demanded

Which of the following is the textbook's definition of a supply curve?

a curve that shows the relationship between the price of a product and the quantity of the product supplied

What is an inferior good?

a good for which demand decreases as income rises

what is a normal good?

a good for which demand increases as income rises

What type of assessment is one in which a person's values and political views form part of that assessment?

a normative assessment

Which of the following is the correct definition of demand schedule?

a table showing the relationship between the price of the product and the quantity of the product demand

which of the following is the textbook's definition of a supply schedule?

a table that shows the relationship between the price of a product and the quantity of the product supplied

which of the following is consistent with the law of supply

an increase in price causes an increase in the quantity supplied, and a decrease in price causes a decrease in the quantity suppied

Which of the following would result in an increase in the demand for apples iphone 5?

an increase in the price of Samsung's Galaxy, a subsititue for apples iphone 5

If a market system functions well, which of the following is necessary for the enforcement of contracts and property rights?

an independent court system

What is the name given to the development of a new process of making a good?

an invention

In the united states, property rights

are guaranteed by two amendments to the u.s. consitituion

Fill in the blank. In economics, optimal decisions are made ____

at the margin

When the price of one good increases, the demand for another good decreases as a result. The two goods can be regarded as

complements

If a country has a comparative advantage in the production of a good, then that country

has a lower opportunity cost in the production of that good

What is the outcome of enforcing contracts and property rights in a market system?

increased economic activity

What is the term for the highest valued alternative that must be given up to engage in any activity?

opportunity cost

The stock of computers, factory buildings, and machine tools used to produce goods better are known as

physical capital

Absolute advantage is the ability of an individual, firm, or country to

produce more of a good or service than competitors using the same amount of resources

Which of the following refers to markets where goods such as computers or services such as medical treatment are offered?

product markets

What are copyrights designed to do?

protect intellectual property rights

Generally speaking, for a market system to work, individuals must

take risks and act in rational, self-interested ways

A firm's process to produce good and services are called

technology

Human capital is

the accumulated training and skills that workers possess

Which of the following is the correct definition of market demand?

the demand by all the consumers of a given good or service

The term "quantity supplied" refers to

the quantity of a good or service that a firm is willing and able to supply at a given price

Which of the following is critical to the success of a market system?

to allow individuals or firms to have exclusive use of their property