ECON 1500 exam 1 (quiz questions tyler bowels)

If both Utah and Colorado specialize in the good in which it has a comparative advantage and then trade with the other state,

joint consumption and production will increase

Which of the following are scarce?

labor

If you make decisions as assumed by economists, you are in college rather than working as a truck driver because you perceive the _____________ of a college degree as greater than the ________________ of a college degree

marginal benefit; marginal cost

in a market economy,

markets answer the questions of what, how and for whom

a market economy tends to,

maximize voluntary exchange, align incentives, produce goods efficiently

in principle, socialism is:

more concerned about fairness than capitalism

A point outside of an existing PPC:

not possible

In explaining why a typical taxpayer living in Park City, UT is helping to pay for your education at Utah StateUniversity, your best economic argument would rely on:

notion of external benefits

Scarcity results in:

opportunity costs, no free lunch principle, necessity of choice

Which of the following is not associated with Keynesian economics?

policy of laissez faire

Two countries that specialize their production based on comparative advantage and then trade with each other will be able to:

produce and consume more

The U.S. Government has an economic justification to and typically does:

produce public goods, promote competition, limit fraud and corruption

Markets, without government intervention, likely will:

produce too few college graduates due to external benefits of education

Per capita output would be certain to increase if:

real output increases and population decreases

Which of the following is the most likely cause of cyclical unemployment?

recession

The business cycle consists of several stages or phases. Which is the accurate sequence?

recession, trough, upturn, peak

Compared to market based economies, both feudalism and mercantilism:

relied much less on the invisible hand to coordinate economic decisions

According to the Invisible Hand Theorem, the market system will

result in socially desirable outcomes and produce goods efficiently

Which of the following play a role in determining where oranges will be produced in the U.S.?

self interest, economic decision rule, invisible hand

Why do farmers in Idaho produce potatoes not oranges?

self interest, potato production is profitable

A machinist who loses her job due to imports and cannot find another job due to the lack of jobs for machinists would most likely be classified as which type of unemployment?

structural

classical economics would argue:

supply creates demand, laissez faire increases unemployment

households are on the:

supply side of factor markets and the demand side of goods markets.

Which of the following is a cause of structural unemployment?

technology innovation, competition from imports

The total labor force is 100,000 out of a possible working age population of 300,000. The total number of unemployed is 5,000. The labor force participation rate is:

33%. labor force/population

The principle of increasing marginal opportunity cost does not hold in which of the following cases?

All inputs are equally useful in the production of all goods

What did the Wealth of Nations argue in favor in?

Argued in favor of allowing markets to answer the question of what to produce.

Which of the following is/are true concerning trade and specialization. For two states to benefit from specialization and trade?

Both differences in goods and resources are required

California will have a comparative advantage in producing oranges compared to Alaska if,

California has a lower opportunity cost of producing oranges

In the context of the circular flow model, in which market does the supply and demand for NFL quarterbacks interact to determine the wages of NFL Quarterbacks?

Factors

A person with marketable skills who recently decided to start looking for a job after 10 years as a stay-at-home dad would most likely be classified as which type of unemployment?

Frictional

Which would most likely suggest that the current inflation problem in the U.S. is the fault of government policy?

Friedman

For which of the following questions can the discipline of economics provide an explanation as to the correct answer?

How to produce?

Economics as a discipline

Is defined more by its methodology than its areas of inquiry, assumes individuals are rational, assumes that individuals are self interested when making descisions

Adam Smith was of the opinion that which of the following was a source of national wealth?

Laissez faire, specialization based on comparative advantage, trade and markets

Applying the economic decision rule, you would not get the Covid vaccine if you perceived that:

Marginal benefit to you of you getting vaccinated < marginal cost to you of getting vaccinated.

In the United States, which is primarily used to determine how cars are produced?

Markets

In the United States, which is used to determine the wages of welders?

Markets

Which statement best summarizes the Invisible Hand Theory?

Markets typically channel individual self interest to achieve the common or social good

In his book, The Wealth of Nations, Adam Smith:

Mercantalisim was not a system that produced wealthy nation, in favor of the market system, focused on institutions

Which of the following will shift the PPC out?

More labor

Why doesn't Utah produce cars?

Opportunity cost is too high

Even though 80,000 individuals in the United States wait for kidney transplants and, for a price, there are many individuals who would be willing to supply a kidney, it remains illegal to buy and sell kidneys in the United States. A market for kidneys does not exist because of:

Political Forces.

According to the Invisible Hand Theorem, the market system will:

Produce goods that people want and demand

Which statement is not consistent with the law of supply?

Quantity supplied of a good is inversely related to the good's price

The U.S. Government's response to the unemployment that emerged in 2020:

Reflected a Keynesian view of the economy.

Which of the following is most important to Classical economics?

Technology and capital

Which of the following are associated with Adam Smith and his book, Wealth of Nations:

The Market System

The primary cause behind the development of Keynesian economics was:

The great depression

Typically, birth rates in a nation fall as incomes rise since:

The marginal cost of having children rises.

Which of the following best defines GDP?

The market value of an economy's production of final goods and services.

Typically, USU would have more seniors on its men's basketball team compared to UNC since:

UNC players face a higher marginal cost of staying in college.

Households (i.e., consumers):

Ultimately determine the answer to the question, What to produce?

Suppose there is excess demand for a particular good and price starts to rise. What will the rise in price cause?

decrease in quantity demanded, inrease in quantity supplied

An increase in equilibrium price and a decrease in equilibrium quantity is most likely the result of:

decrease in supply

Graphically, a change in price causes:

a movement along a given supply curve, not a shift.

If the price in a market is above its equilibrium level, there will be a:

a surplus and downward pressure on price

Which of the following is most important to Keynesian economics?

aggregate demand

trade:

allows specialization, which reduces costs.

John Locke:

argued in favor of individual rights, equality and access to the truth

The pattern of specialization and trade that happens between Idaho and Florida:

based on social forces

An economic argument that might support Utah State University issuing a mandate that all students show proof of Covid Vaccination in order to attend class would rely on:

being vaccinated produces an external benefit, not being vaccinated produces an external cost

If there were decreasing marginal opportunity costs, the production possibility curve would be:

bowed in

Which explains why average income per capita in the world started to increase rapidly around 1750?

broader adoption of specialization and trade, and broader adoption of markets

which of the following is an example of the U.S government's role as an actor?

building a highway

prices:

change based on changes in supply and demand, allocate resources, answer of what to produce

Which of the following would cause quantity demanded to change without changing the demand curve?

change in price of good

The largest component of GDP is:

consumption spending

During the Covid recession, the unemployment rate reached 14.7% or 23 million people in April 2020. This level of unemployment:

cyclical

Consider the boxed beef market in which production requires hundreds of workers to stand very close to each other for extended periods. Covid 19 has caused?

decrease in supply and higher prices for meat at grocery stores

Consider horse trailers, a normal good. An decrease in incomes will:

decrease the demand for horse trailers

There is a shortage of Covid vaccine because:

demand is high

businesses are on the:

demand side of factor markets and the supply side of goods markets.

Consider the market for face masks. As more folks receive the vaccine, the _____ of/for face masks will _____.

demand; decrease

The text attributes the growth of economies over the last 200 years largely to:

development of markets

If President Biden argues that trade with China is killing the U.S. economy, he:

doesn't appreciate comparative advantage, may be correct if he means that trade with china is hurting some US workers

The cost of your college education includes:

explicit cost of books, implicit cost of your time, opportunity cost

When quantity supplied is greater than quantity demanded, prices tend to:

fall

Which sequence is in the correct chronological order?

fudalism, mercantilism, wealth of nations, us constitutions

Professor Diamond in his book, Guns, Steel, and Germs, argues that the institutional arrangements that emerged in Europe and allowed European nations to colonize other areas of the globe were primarily due to:

geography, animals and plants

in socalism:

government planning rather than the market is relied on to coordinate economic activity

In a Mercantilist system:

governments distributed the rights to produce

the more the current price is below the equilibrium price, the

greater the resulting shortage will be

Which of the following is not one of the three economic questions faced by all societies?

how to limit scarcity

Keynesian economists would likely suggest that the best government response to unemployment would be to:

increase aggregate demand with higher government spending, increase supply with government spending

For an iPhone, an increase in price of a Google phone would:

increase demand for iphones

An improvement in the genetics of chickens, which causes them to grow faster will:

increase the supply of chicken meat

In the supply and demand model, better technology causes a(n) _________ in ____________ which leads to ________ prices.

increase, supply, higher

Which of the following best describes the source of comparative advantage among individuals?

individuals have different skills and different goods require different skills

If the hourly wage of U.S. workers is $16, the hourly wage of Mexican workers is $4, and U.S. workers produce 5 times as much output per hour as Mexican workers, then, other things equal, it would be efficient to locate production facilities in:

the United States since the cost per unit of output will be lower.

A primary, root source of economic growth over the last 200 years is:

the development of market economies

Countries gain from trade by producing:

the goods they can produce at the lowest opportunity cost

potential output

the level of real GDP the economy would produce if all prices, including nominal wages, were fully flexible

For a given benefit, a rational person chooses the option that has:

the lowest opportunity cost.

aggregate income

the total income received by all factors of production in a given period

What did adam smith think about free markets?

thought a market system would result in goods being produced efficiently

markets:

typically have neither shortages or surpluses

unemployment rate:

unemployed/labor force x 100

The law of supply states that, other thing equal, as the price of a good goes:

up, the quantity supplied goes up

Suppose your wage is increased from $7.50 per hour to $10.00 per hour and you decide to switch from part-time to full-time work. Your behavior can best be explained by the fact that your supply of labor curve is:

upward sloping