eco chap 1 HW1

In the ____________, households work and receive payment from firms. financial investment market savings market labor market financial capital market

labor market

When nations desire a healthy macroeconomy, they typically focus on three goals, one of these being: A. low inflation B. assuring competition between firms C. balanced budget D. prudent monetary policy LOW INFLATION

A.

Which of the following best denotes the reason for the existence of substantial shortages of essential goods and services? A. a command economy B. a market-oriented economy C. government laws and rules D. the microeconomy

A. a command economy

Specialization: A. can lead to an increase in overall production. B. allows workers to develop skills by working on a large number of tasks. C. is always the result of an inefficient use of resources. D. leads to greater self-sufficiency.

A. can lead to an increase in overall production.

The basic difference between macroeconomics and microeconomics is: A. microeconomics concentrates on the behavior of individual consumers and firms while macroeconomics focuses on the performance of the entire economy. B. microeconomics explores the causes of inflation while macroeconomics focuses on the causes of unemployment. C. microeconomics concentrates on the behavior of individual consumers while macroeconomics focuses on the behavior of firms. D. microeconomics concentrates on individual markets while macroeconomics focuses primarily on international trade.

A. microeconomics concentrates on the behavior of individual consumers and firms while macroeconomics focuses on the performance of the entire economy.

Which of the following statements most likely lies within the realm of microeconomics? A. Unemployment rises during a recession and falls during an expansion. B. An increase in labor costs will increase the additional cost of producing another bus. C. A rapid acceleration of the supply of money in the economy may create inflation. D. An increase in government spending will increase the aggregate demand for goods and services in the economy. B.An increase in labor costs will increase the additional cost of producing another bus.

B.

The simple two-sector circular flow diagram of economic activity is a model of the: A. interaction among taxes, prices, and profits. B. flow of goods, services, and payments between households and firms. C. role of unions and government in the economy. D.influence of government on business behaviour.

B. flow of goods, services, and payments between households and firms.

In the ______________, households receive goods and services and pay firms for them. A. financial capital market B. goods and services market C. market of factors of production D. labor market

B. goods and services market

_____________ is a term referring to the fact that for many goods, as the level of production increases, the average cost of producing each individual unit declines. A. Advertising B. Product Quality C. Economies of scale D. Inflation

C. Economies of scale

In which of the following countries will the national government have the greatest influence with respect to the nation's economy? A. South Korea B. England C. North Korea D. Canada

C. North Korea

In the first chapter of The Wealth of Nations, Smith introduces the idea of the __________, which means the way in which the work required to produce a good or service is divided into a number of tasks that are performed by different workers. A. modern economy B. task economy C. interconnected economy D. division of labor

D. division of labor

In a command economy, the __________ either makes most economic decisions itself or at least strongly influences how the decisions are made. A.firm B. business sector C. market D. government

D. government

Macroeconomic topics do not usually include: A. the rate of inflation. B. economic growth. C. the rate of unemployment. D. the profit maximizing decisions of an individual manufacturer.

D. the profit maximizing decisions of an individual manufacturer.

The two main tools of macroeconomic policy include monetary policy, and fiscal policy, which involves __________ spending. capital market business household government

GOVERNMENT

Which of the following is most likely a topic of discussion in macroeconomics? an increase in the wage rate paid to automobile workers an increase in the price of a hamburger a decrease in the unemployment rate a decrease in the production of DVD players by a consumer electronics company

a decrease in the unemployment rate

In a _______________________, most economic decisions about what to produce, how to produce it, and for whom to produce it are made by buyers and sellers. A. microeconomy B. command economy C. macroeconomy D. market-oriented economy

d. MARKET ORIENTED ECONOMY