Econ

The last time gas prices increased drastically, sales of large sport Utility Vehicles (SUVs) fell. Why?

Higher gas prices increased the cost of driving a SUV.

The situation describes in the book as "smart for one, dumb for all" occurs when.

Individules act rationally, so there are still unexploited opportunities for society as a whole.

The Incentive Principle is an example of

A positive economic principle

Assume consumers eat either rice or pasta for dinner every night. If the price of rice increases, then one would expect to see.

An increases in the demand for pasta.

If A1 has an absolute advantage over Beth in preparing meals, then.

A1 can prepare more meals in a given time period than Beth.

Dividing the total cost of undertaking n units of an activity by n reveals the:

Average cost

A government is running a budget deficit if.

Government revenue is less than government spending.

If a country economic decisions are made by an individual or small number of individuals, then it has a.

Centralized economy

Suppose it takes Dan 5 minutes to make a sandwich and 15 minutes to make a smoothie, and it takes Tracy 6 minutes to make a sandwich and 12 minutes to make a smoothie. Which of the following statements is correct?

Dan has the comparative and absolute advantage in sandwiches.

A demand curve is ------- sloping because ------- .

Downward; fewer people are willing to buy an item at higher prices.

All of the following statements are correct EXCEPT.

Economies grow steadily over time.

Forest lives in complete isolation in Montana. He is self-sufficient and feeds himself through hunting, fishing, and farming. Which of the following statements about Forest is true?

Forest has to make trade-offs.

Which of the following statement is normative?

Large budget deficits should be avoided .

Suppose Cathy and Lewis work in a bakery making pies and cakes. Suppose it takes Cathy 1.5 hours to make pie and 1 hour to make a cake, and suppose it takes Lewis 2 hours to make a pie and 1.5 hours to make a cake. Which of the following statements is correct?

Lewis should specialize in pies, and Cathy should specialize in cakes.

According to the textbook,NAFTA was expected to help which country exploit its comparative advantage in the production of goods made by unskilled labor.

Mexico

Moe has a big exam tomorrow. He considered studying this evening but decided to hang out with Curly instead. If neither activity involves any explicit costs, and Moe always chooses rationally,it must be true that:

Moe gets more benefit from spending time with Curly than from studying.

Which of the following is NOT a characteristic of a market in equilibrium?

Neither buyers nor sellers want the price to change.

What might cause a decrease in current supply of a product?

New information that leads sellers to believe that the products price will rise in the future.

Due to the fact the Curly used his frequent flyer miles to fly to visit Moe. Curly told Moe that it didn't cost him anything to visit. Is Curly correct?

No, because Curly could have used his frequent flyer miles to go somewhere else instead.

Which of the following is the most aggregated value?

Total output of a country

Which of the following statements is positive?

When the federal Reserve increases the money supply, interest rates decrease.

The United States was unable to maintain its dominance in the production of televisions because:

automated techniques allowed production to be outscored to countries with less-skilled workers.

Shelly purchases a leather purse for $400.one can infer that.

her reservation price was at least $400

When Thurston catches 10 fish a day, he can gather a maximum of 40 coconuts, and when he catches 20 fish a day, he can gather a maximum of 30 coconuts. If Thurstons opportunity cost of producing each good increasing as he produces more more of it, and he decides to catch 30 fish a day, then the maximum number of coconuts he can gather must be.

less than 20

Which branch of economics is most likely to study differences in countries' growth rates?

macroeconomics

Buyers and Sellers of a particular good make up the.

market for the good.

If the demand for steak increases as income increases, then steak is a.

normal good

one reason there is political opposition to international trade is that.

not everyone benifits from trade.

When comparing the standard of living in two counties it is important to adjust total output for differences in.

population.

If total output increases from 1 trillion to 2 trillion as population increases from 100 million to 200 million, then output per person.

remains constant.

Outsourcing is a term increasingly used to refer to the act of.

replacing relatively expensive American workers with low-wage workers overseas.

Suppose that the price of doughnuts decreases. Given that doughnut holes are a by-product of producing doughnuts,one would expect.

the supply of doughnut holes to decrease.

The average benefit of n units of an activity is the

total benefit of n units divided by n.

Points that lie outside the productions possiblities curve are ----- and points that lie inside the production possiblities curve are -------.

unattainable;attainable

The fraction of people who would like to be employed, but cant find work is called the.

unemployment rate.

The cost-benefit model used by economists is

useful because most people follow it most of the time.