Macro Econ Exam 1
If an increase in income leads to in an increase in the demand for peanut butter, then peanut butter is
a normal good
In the United States in 2014, the percentage of people without any form of health insurance was about
10%
What is the black market?
Buyers and sellers violate government policy because it is illegal
Which of the following statements is true
Every individual, no matter how rich or poor, is faced with situations that require trade-offs.
Which of the following statements about scarcity is true
Scarcity refers to the situation in which unlimited was exceed limited resources
The three fundamental questions that any economy must address are:
What goods and services to produce; how will these goods and services be produced; and who receives them
If, in response to an increase in the price of chocolate the quantity of chocolate demanded decreases, economists would describe this as
a decrease in quantity demanded
Holding everything else constant, an increase in the price of MP3 players will result in
a decrease in the quantity of MP3 players demanded
In the economic sense, almost everything is scarce, _______ of a good or service occurs when the quantity demanded us greater than the quantity supplied at the current market place
a shortage
Marginal benefit is equal to the ________ benefit a consumer receives from consuming one more unit of a good or service
additional
Which of the following is a factor of production
an oven in a bakery
Economists assume that individuals
are rational and respond to incentives
Comparative advantage means the ability to produce a good or service
at a lower opportunity cost than any other producer
In the United States, private health insurance companies
can be either for-profit or not-for-profit firms
Elvira decreased her consumption of bananas when the price of peanut butter increased. For Elvira, peanut butter and bananas are
complements in consumption
The differences between the highest price of a consumer us willing to pay for a good and the price the consumer actually pays is called
consumer surplus
A typical consumer of health care in the United States
does not pay the full prices of his or her health care
The opportunity cost of going to an outdoor music festival is
equal to the highest value of an alternative use of the times and money spent on the festival
over the past 160 years in the United States, life expectancy
has more than doubled
A contract under which a buyer agrees to make payments in exchange for the provider agreeing to pay some or all of the buyers medical bills is referred to as
health insurance
The production possibilities frontier model shows that
if all resources are fully and efficiently utilized, more of one good can be produced only by producing less of another good
if the Apple Watch and the Samsung Gear S2 are considered substitutes, then, other things equal, an increase in the price of the Apple Watch will
increase the demand for the Gear S2
As women's wages have risen relative to mens wages, the opportunity cost ti women of doing housework has_______ than has the opportunity cost to men.
increased more
If society decides it wants more of one good and all resources are fully utilized, then
it has to give up some of another good and incur some opportunity costs
The resource income earned by those who supply_____ is called wages
labor
In economies, the term ________ means "additional" or "extra"
marginal
The extra cost associated with undertaking an activity is called
marginal cost
In economics, the term ________ refers to a group of buyers and sellers of a product and the arrangement by which they come together to trade
market
The demand by all the consumers of a given good or service is the ________ for the good or service
market demand
Health care makes up ___________ of the U.S. economy.
more than one-sixth
Typically, the higher the level of income per person in a country, the higher the level of spending per person on health care. This relationship between income and spending indicates that health care is a
normal good
In New York City, about 1 million apartments are subject to rent control government. Rent control
puts a legal limit on the rent that landlords can charge for an apartment
In economics, choices must be made because we live in a world of
scarcity
By definition, economics in the study of
the choices people make to attain their goals, given their scarce resources
Better health allows people to work harder, which raises a country's total income. This indicates that in effect, better health
shifts out a country's production possibilities frontier
In the United States, doctors and hospitals that provide most health care are
split evenly between firms and employed by the government
Scarcity
stems from the incompatibility between limited resources and unlimited wants.
suppose that when the price of strawberries decreases, Simone increases her purchase of whipped cream. To Simone
strawberries and whipped cream are complements
When the price of a good falls, consumers buy a larger quantity because of the _________ effect and the ________ effect.
substitution; income
the term ''property rights'' refers to
the ability to exercise control over one's own resources within the confines of the law
Marginal cost is:
the additional cost to a firm of producing one more unity of a good or service
If the price of automobiles was to increase, then
the demand for gasoline would decrease
A minimum wage law dictates
the lowest wage that firms may pay for labor
In a competitive market equilibrium
the marginal benefit equals the marginal cost of the last unit sold
Willingness to pay measures
the maximum price that a buyer is willing to pay for a good or service
which of the following generation categories has the largest population in the United States in 2015?
the millennials
The attainable production points on a production possibilities curve are
the points along and inside the production possibility frontier
When a competitive equilibrium is achieved in a market
the total net benefit to society is maximized
Who receives the most of what is produced in a market economy
those who are willing and able to buy them
The idea that because of scarcity, producing more of one good or service means producing less of another good or service refers to the economic concept of
trade-off
The points outside the production possibilities frontier are
unattainable
