Macro Final

Macroeconomics is the study of A. the economy as a​ whole, including topics such as​ inflation, unemployment, and economic growth. B. how households and firms make​ choices, how they interact in​ markets, and how the government attempts to influence their choices. C. why the U.S. has spent so much money on wars and government surveillance of its own citizens. D. the economy on a​ state-by-state basis, covering areas affected by the Commerce Clause.

A

What are the implications of this idea for the shape of the production possibilities​ frontier? A. The production possibilities frontier will be bowed outward. B. The production possibilities frontier will have a positive slope. C. The production possibilities frontier will be a straight line. D. The production possibilities frontier will have a negative slope. E. The production possibilities frontier will be bowed inward.

A

Does Bill Gates face​ scarcity? A. ​No, because billionaires can have anything that money can buy. B. ​Yes, because even though​ billionaires' financial resources enable them to afford a much greater array of goods and services than those less​ wealthy, their financial resources are not infinite. C. ​No, because if a billionaire cannot get the goods and services they​ want, someone else can get it for them. D. ​Yes, because there is a limit to the income even billionaires can earn.

B

Microeconomics is the study of A. the economy as a​ whole, including topics such as​ inflation, unemployment, and economic growth. B. how households and firms make​ choices, how they interact in​ markets, and how the government attempts to influence their choices. C. how individuals make good decisions for themselves but hurt society. D. how individuals and firms act altruistically to better society.

B

When the federal government crafts environmental policies that make it less expensive for firms to follow green​ initiatives, A. the policies are likely to be more successful than policies that cost firms​ more, but they do not recognize economic incentives. B. the policies are consistent with economic incentives. This is the correct answer. C. pollution is likely to increase. D. the policies are futile because where the environment is​ concerned, it has been repeatedly shown that firms do not respond to economic incentives

B

A primary difference between macroeconomics and microeconomics is A. Microeconomics is concerned with present decisions while macroeconomics is concerned with future decisions. B. There are no true differences between microeconomics and macroeconomics. C. Microeconomics examines individual markets while macroeconomics examines the economy as a whole. D. Microeconomics is concerned with market economies while macroeconomics is concerned with​ centrally-planned economies.

C

Any model is based on making assumptions because A. models have to be simplified to be useful. B. we cannot analyze an economic issue unless we reduce its complexity. C. both a and b. D. neither a nor b.

C

Economists use models A. to prove that theories are true. B. to describe the real world exactly. C. to answer questions and analyze issues. D. to disprove economic data

C

How do market economies ultimately determine what goods and services are​ produced, how the goods and services will be​ produced, and who will receive the goods and​ services? A. The government determines what goods and services are​ produced, how to produce​ them, and who will receive them. B. Firms determine what goods and services are produced and how to produce​ them, and markets determine who will receive them. C. Consumers determine what goods and services are​ produced, firms determine how to produce​ them, and markets determine who will receive them. D. Consumers determine what goods and services are​ produced, firms determine how to produce​ them, and equity determines who will receive them. E. Firms determine what goods and services are​ produced, efficiency determines how to produce​ them, and markets determine who will receive them.

C

Which of the following statements is​ true? A. Some individuals experience scarcity because they have not learned to live within their means. B. Most individuals face a scarcity of​ time, but few experience a scarcity of other resources. C. All individuals face a scarcity of time and need to make choices how to allocate it. D. While resources are​ scarce, most people​ don't own resources and therefore do not face a scarcity of them.

C

Economic data is used A. only if all relevant data is available. B. to take the place of an economic model. C. to prove that a model is true. D. to test models.

D

One of the basic facts of life is that people must make choices as they try to attain their goals. This unavoidable fact comes from a reality an economist calls A. rationality. B. the market. C. economics. D. scarcity.

D

What does increasing marginal opportunity costs​ mean? A. Increasing the production of a good requires smaller and smaller decreases in the production of another good. B. Increasing the production of a good requires decreases in the production of another good. C. Production is not occurring on the production possibilities frontier. D. The economy is unable to produce increasing quantities of goods and services. E. Increasing the production of a good requires larger and larger decreases in the production of another good.

E

__________ Analysis is concerned with what is​, and ____________ Analysis is concerned with what ought to be. Economics is about _____________ Analysis, which measures the costs and benefits of different courses of action

Positive, Normative, Positive