Econ

(t/f) the term ¨market¨ refers only to trading arrangements that have been approved by the government

False

monique buys a new television for $795. she recieves consumer surplus of $355 from the purchase. how much does monique value her television?

$1150

Brett buys a new cell phone for $100. he recieves consumer surplus of $80 from the purchase. how much does Brett value his cell phone?

$180

What is the size of the per-unit tax

$5

At price of $6, the quantitiy demanded in the market would be

103lbs

in 2017, smiley town consumed 50,000 tubes of toothpaste. in 2018,toothpaste conusmption rose to 62,000 tubes. caluculate the percentage change in toothpaste consumption

24%

what is Japans opportunity cost of producing one wristwatch

25 pounds of rice

using marginal analysis, how many hours should Eva extend her bakerys hours of operations?

4 hours

The stogie shop, a cigar shop in the mall, sells hand rolled cigars for $10.00 and machine made cigars for $2.50 each. what is the opportunity cost of buying a hand rolled cigar?

4 machine made cigars

if the price of milk was $1.25 a gallon and it is now $2.25 a gallon, what is the percentage change in the price?

80 %

At the price of $6, the quantity demanded in the market would be

89lbs

(T/F) marginal benefit is the benefit that your activity provides to someone else

False

An increase in the price of the product would be represented by a movement from

B to A

(T/F) optimal decisions are made at the point where marginal benefit is maximized

False

(t/f) As population declines , scarcity eventually disappers

False

which of the following countries does NOT come close tot he free market benchmark?

Cuba

what happens in the market for suchi if the surgeion general announces that a majority of the raw fish that is imported to make sushi contains high levels of toxic mercury

D decreases, S no change, P and Q decrease

An increase in the price of a complement would be represented by a movement from.......

D2 to D1

which of the following statements about an entrepreneur is TRUE?

Develops the vision for the firm and funds the producing unit

(T/F) in market economies, income distribution is always going to be completely equitable

False

A decrease in the number of firms in a market will cause supply to increase

False

T/F The payment received by suppliers of entrepreneurial skills is called rent

False

T/F a redwood forest is not an example of a factor of production but the harvested and processed redwood is a factor of production

False

T/F any output combination along a production possibility fronteir is associated with overused or unattainable resources

False

T/F examining the conditions that could lead to inflation is an economy is an example of a microeconomics topic

False

T/F for most goods and services, the burden of a tax is on the sellers

False

T/F if consumers believe the price of tablet computers will increase in the future,this will cause the demand for tablet computers to decrease now

False

T/F if the prices of peaches, a substitute for plums, increases the demand for plums will decrease

False

T/F in a free market there are virtually no restrictions, or at best a few restrictions on how a good or service can be produces or sold

False

T/F in economics, the term ¨free market¨ refers to a market where no sales tax is imposed on products sold.

False

T/F it is not possible to have a comparative advantage in producing a good or service without having an absolute advantage

False

T/F producer surplus if the difference between the highest price someone is willing to pay and the price he actually pays

False

T/F the additional cost to a firm of producing one more unit of a good or service is equal to producer surplus

False

T/F the income effect explains why there is usually a direct relationship between the price of product and the quantitiy of the product demanded

False

T/F very few businesses and virtually no nonprofit organizations,hire economist

False

as the number of firms in a market increases, the supply curve will shift to the left and the equilibrium price will rise

False

if the demand curve for a product shifts to the right and the supply curve for the product shifts to the left, equilibrium price and equilibrium quantity will both increase.

False

T/F the differnce between consumer surplus and producer surplus in a market is equal to the deadweight loss

Fasle

which of the following statements is TRUE?

George has an absolute advantage in both tasks

Housework has........, because the cost of these specialist is ......

Increased;lower

Which of the following statements is true?

Jack as a comparative advantage in garden cultivating and George in lawn mowing

In a competitive market equilibrium the ...... equals the ......... of the last unit sold

Marnigal bneift;marginal cost

Which of the following statements is true?

Minnie has an absolute advantage in making umbrellas and mickey in making hats

FIGURE- which panel best decribes what happens in this market when there is a decrease in the productovoty of commercial fishermen

Panel B

A technological advancement would be represented by a movement from....

S1 to S2

an increase in the expected future price of the product would be represented by a movement from

S2 to S1

The study of economics arises due to

Scarcity

does either Japan or Thailand have an absolute advantage and if so, in what product?

Thailand has an absolute advantage in both products

which of the following generation catgeories has the smallest population in the United States in 2017

The baby boomers

It would seem that commerce bank would have a strong incentive to install ¨bandit barriers¨ to detur robberies. why wouldnt they do it?

The banks must have weighed the cost of installing bandit barriers against the benefits and decided that they have ¨no interest in ever putting in the barriers.¨

A change in quantitiy supplied is represented by a movement along the supply curve

True

All else equal, as the price of a product falls, the quantity suppliued decreases

True

T/F More chief executive officers of fortune 500 companies majored in economics than in any other subject

True

T/F a decrease in the unemployment rate may be represented as a movement from a point inside the production possibilities frontier to a point on the frontier

True

T/F a normal good is a good for which the demanded decreases as income decreases, holding everything else constant

True

T/F a surplus is defined as the situation that exists when the quantity of a good supplied is greater than the quantity demanded

True

T/F a tax is efficent if it imposes a small excess burden relative to the tax revenue it raises

True

T/F a welding machine is an example of a factor of production if it is being used to produce automobiles

True

T/F an increase in the unemployment rate may be represented as a movement from a point on the production possibilities frontier to a point inside the frontier.

True

T/F any output combination inside a production possibilities frontier is associated with unused or underutilized resources

True

T/F examining the conditions that could lead to economic growth is an example of a macroeconomic topic

True

T/F human capital refers to an accumulated skills and training that workers possess

True

T/F if Abigail can make more candles in one day than pierre, then Abigail has an absolute advantage in making candles.

True

T/F if the demand for a product increases and the supply of the same product decreases, the equilibrium price will increase

True

T/F if the market price is at equilibrium, the deadweight loss is zero

True

T/F in a two-good, two country world, if one country has an absolute advantage in the production of both goods, it can still benefit by trading with the other country

True

T/F in the market for gasoline, an increase in the federal excise tax on gasoline would shift the supply curve up

True

T/F market equilibrium occurs where the quanitty supplied is equal to the quantitty demanded

True

T/F the decisions General Motors makes in determinng production levels for its chevy volt is an example of a microeconomic topic

True

T/F the payment received by suppliers of entrepreneurial skills is called profit

True

T/F the total amount of consumer surplus in a market is equal to the area below the market demand curve and above the market price

True

T/F there will be no deadweight loss if the marginal benefit to consumers is equal to the marginal cost of production and the sum of consumer surplus and producer surplus is maximized

True

Scarcity refers to the situation in which

Unlimited wants exceed limited resources

what is the equilibrium hourly wage (W*) and the equilibrium quantity of labor is (Q*)

W*=$9.00;Q*=380,000

when...... in a market, the total net benefits to society is maximized

a competitive equilibrium is achieved

which of the following would cause a decrease in the equilibrium price and decrease in the equilibrium quantity of papayas

a decrease in demand

which of the following would cause an increase int he equilibrium price and decrease int he equilibrium quantity of watermelon

a decrease in supply

which of the following would shift the supply curve for energy drinks to the left

a decrease in the number of firms that produce energy drinks

which of the following would cause the equilibrium price of apple juice to decrease and the equilibrium quantity of apple juice to increase

a decrease in the price of apples

farmers can plant either corn or soybeans in their fields. which of the following would cause the supply of soybeans to increase?

a decrease in the price of corn

the term ¨market¨ in economics refers to

a group of buyers and sellers of a product and the arrangement by which they come together to trade

the cost incurred from the production of an additional unit of product

a marginal cost to the firm

if an increase in income leads to an increase in the demand for sushi, then sushi is

a normal good

the recession of 2007-2009 would most likely be represented in a production possibilities frontier graph by

a point inside the fronteir

which term refers to a legally established maximum price that firms may charge

a price ceiling

economist............. that price controls are desirable

a reluctant to state

an efficient tax is

a tax that imposes a small excess burden relative to the tax revenue that is raises

marginal cost is the .............. associated with a particular increase in an activity

additional cost

which of the following can use economic principles to improve how they make important decisions?

all of the above

Assume dinas diner only produces sliders not hot wings. a combination of 40 sliders and 50 hot wings would appear

along Dinas production possibilities frontier

If you can produce more of something than others with the same resources, you have.....

an absolute advantage

which of the following is a factor of production

an acre of forested land

what does the term ¨marginal¨ mean in economics

an additional or extra

if in response to a decrease in the price of coffee, the quantity of coffee demanded increases, then economists would describe this as.....

an increase in quantitiy demanded

an outward shift of a nations production possibilities frontier can occur due to

an increase in the labor force

electric car manufacterers want to sell more electric cars at a higher price.which of the following events would have this effect.

an increase in the price of gasoline

farmers can either raise goats or ostriches on their land. which of the following would cause the supply of goats to decrease

an increase in the price ostriches

an increase in the demand for peanuts due to changes in consumer tastes, accompanied by an increase int he supply of peanuts as a result of favorable growing conditions,will result in

an increase int he equilibrium quantitiy of peannuts;the equilibrium price may increase or decrease.

which of the following would cause a decrease in the supply of peanut butter

an increase the price of peanuts

a successful market economy requires well defined property rights and ....

an independent court system to adjudicate disputes based on the law

if an increase in income leads to a decrease in the demand for salami, then salami is .........

an inferior good

a guild is

an organization of producers that limits the amount of a good produced

economic models

are simplified versions of reality

if the marginal cost of producing a television is constant at $200, then a firm should produce this item.....

as long as the marginal benefit it recieves is just as equal to or greater than $200.

which of the following is part of an economic model

assumptions

A black market is a market where buying and selling take place

at prices that violate government price regualtions

tax incidence is the actual division of the

burden of the tax between buyers and sellers in a market

all........... economies have been political dictatorships

centrally planned

the market for smart water is becoming more competitive. the increase in competition in this market is an example of how the market responds to.....

changes in consumer taste

in a market economy, who decides what goods and services will be produced?

consumers and producers

economics promote which of the following as the way to make the best decision

continue an enjoyable activity up to the point where its marginal benefit equals its marginal cost

If the price of one bottle is $24.....

curly will recieve $26 of consumer surplus from buying one bottle

which of the follwing is part of an economic model?

data

the government proposes a tax on halogen light bulbs. sellers will bear the entire burden of the tax if the ...........

demand curve for halogen bulbs is horizontal

all of the following are considered intellectual property except

shares of stocks

what would happen in the market for knee replacement surgery if insurance companies started to cover a smaller portion of the cost of surgery?

demand will decrease, but this will not shift the supply curve.

in a competitive market the ..... curve shows the marginal benefit recieved by consumers and the .......... curve shows the marginal cost to producers

demand;supply

A primary role of .......... is to describe how choices are made, analyze the results of those choices, and advise on how better decisions can be made

economist

the primary purpose of patents and copyrights is to

encourage the expenditure of funds on research and development to create new products

a change in which of variable will change the market demand for a product

expected future prices

if a vineyard wants to raise funds to purchase a new bottling machine, it does so in the....

factor market

(T/F) an economic model is a complex version of relatity used to analyze real-world economic situations

false

T/F an inferior good is a good for which the quantitity demmanded increases as the price decreases, holding everything else constant

false

T/F the additional benefit to a consumer from consuming one more unit of a good or service is the marginal benefit

false

Allocative efficiency is achieved when

firms produce the goods and services that consumers value most

in economics, tangible merchandise is referred to as

goods

suppose that when the price of hamburgers increases, the Ruiz family increases their purchases of hot dogs. to the ruiz family........

hamburgers and hot dogs are substitutes

The basic economic problem of scarcity

has always existed and will continue to exist

who recieves the goods and services produced in the United States depends largely on

how income is distributed

which of the following is a positive economic statement

if the price of gasoline rises, a smaller quantity of it will be bought.

which of the following describes the difference between ¨scarcity¨ and ¨shortage¨

in the economic sense, almost everything is scarce. A shortage of a good or service occurs when the quantity demanded is greater than the quantity supplied at the current market price

the..........effect of a price change refers to the impact of a change in the price of a good on a consumers purchasing power

income

A........... is represented by the rightward shift of the demand curve while an........... is represented by a movement along a given demand curve

increase in demand;increase in quintitty demanded

the law of demand implies,holding everything else constant, that as the price of yogurt

increases, the quantity of yogurt demanded will decrease

In econimics, the practical application of an invention is known as

innovation

when a celebrity has the desire to have his image protected following his death, this is best described as an example of the protection of...

intellectual property

FIGURE- at a price of $15, the quantity sold....

is 2 units

A supply curve

is a curve that shows the relationship between the price of a product and the quantity of the product supplied

The revenue received from the sale of an additional unit of a product

is a marginal benefit to the firm

The area above the market supply curve and below the market price

is equal to the amount of producer surplus in a market

What is an economic model

it is a simplified version of some aspect of economic life used to analyze an economic issue

The additional cost to a firm of producing one more unit of a good or service is the

marginal cost

which of the following contributes to the efficiency of markets?

markets promote competition and voluntary exchange

in order to be binding , a price floor

must lie above the free-market equilibrium price

an inward shift of the production possibilities fronteir represents

negative economic growth

if a straight line passes though the point x=8 and y=4 and also through the point x=12 and y=6, the slope of this line is

one half

The ability to exercise control over ones own resources within the confines of the law refers to...

ones propery rights

the concept of ....... is that the economic cost of using a factor of production is the alternative use of that factor that is given up

opportunity cost

Economist assume that

optimal decisions are made at the margin

FIGURE- which pannel best described what happens in this market if there is a substantial increase in the price of blu-ray players

panel D

suppose the US government encouraged new teachers to take jobs in underperforming schools by paying the new teachers a $20,000 bonus. these teachers would be exemplifying the economic idea that................

people respond to economic incentives

the difference between the lowest price a firm would have been willing to accept and the price it actually receives from the sale of a product called

producer surplus

When the marginal benefit equals the marginal cost of the last unit sold in a competitive market

producer surplus is equal to consumer surplus

Every society faces faces economic trade-offs. this means

producing more of one good means less of another good can be produced

when you purchase a new surfboard you do so in the

product market

which of the following is a problem inherent in centrally planned economies

production managers are more concerned with satisfying governemnts orders that with satisfying consumer wants

when goods and services are produced at the lowest possible cost,........ occurs

productive efficiency

in economics, the difference between a firms revenues and its costs is referres to as .....

profit

households

purchase final goods and services in the product market

At market equilibrium

quantity demanded equals quantity supplied

Economist assume that rational people

respond to economic incentives

which of the following statements is TRUE about revenue

revenue is the total amount received for selling a good or service

Firms

sell goods in the product market

in economics, activities done for others,such as providing house cleaning or dental work, are reffered to as.....

services

which of the following is motivated by an equity concern

some US colleges have cut back on merit scholarships since these programs siphon money from need-based programs, thus harming lower-income students with greater financial need.

which of the following is a consequence of minimum wage laws?

some employers will be reluctant to hire many workers as they would without minimum wage

increasing opportunity cost along a bowed-out production possibilities frontier occurs because

some factors of production are not equally suited to producing both goods or services

in the circular flow model, households.....

spend earnings from resource sales on goods and services in the factor market

which of the following is an example of an activity undertaken by an entrepreneur

starting a snow cone business

When the price of a good rises, consumers buy a smaller quantitiy because of the ........ effect and the .......... effect

supply;demand

the processes used to produce goods and services describes ...

technology

human capital refers to

the accumulated skills and training that workers have

technological advancements have led to lower prices and an increase in the sale of color laser printers. how does this affect the market for traditional inkjet printers?

the demand curve for inkjet printers shifts to the left

in Janurary, buyers of gold expect that the price of gold will fall in Feburary. what happens in the gold market in Janurary, holding everything else constant

the demand curve shifts to the left

if the price of propane-fueled gas grills was to decrease, then ...

the demand for propane would increase

FIGURE- if the price of motorcycle engines increases, and the wages of motorcycle workers increase,how will the equilibrium point change?

the equilibrium point will move from A to B

if a firm expects that the price of its produce will be lower int he future than it is today.....

the firm has an incentive to increase supply now and decrease supply in the future

which of the following is NOT a flow int he circular flow model

the flow of profit and the flow of revenue

Consider the following agents:a. the government B: consumers C:producers...... who in the modern mixed economy,decides what goods and services will be produced with the scarce resources available in that economy?

the government,consumers, and producers

opportunity cost is defined as

the highest valued alternative that must be given up to engage in an activity.

which of the following is a factor of production

the janitor at the local elementary school

a conusmer is willing to purchase a product up to the point where

the marginal benefit is equal tot he price of the product

the figure above represents the market for iced tea. assume that this is a competitive market. At an output of 10,000 units

the marginal benefit of iced tea is greater than the marginal cost;therefore output is inefficiently low

consumer surplus in a market for a product would be equal to the area under the demand curve if

the market price was zero

how does a market system prevent people from getting as many goods and services to those who are able to pay for those products and therefore income is a limiting factor.

the market system allocates goods and services to those who are able to pay for those products and therefore income is a limiting factor

the production possibilities frontier shows

the maximum attainable combinations of two products that may be produced in a particular time period with available resources

a tax is imposed on employers and workers that are used to fund social security and medicare. this tax is sometimes referred to as ........

the payroll tax

the attainable points in a production possibilities frontier are

the points outside the production possibilities frontier

one would speak of a movement along a supply curve for a good,rather than a change in supply, if......

the price of a good changes

a demand curve shows the relationship between....

the price of a product and the quantity of the product demanded

Suppliers will be willing to supply a product in all of the following situations except when

the price recieved is less than the additional cost of producing the product

for demand curve D1

the producer bears a smaller share of the tax burden if the supply curve is S1

if in a competitive market, the marginal benefit is greater than marginal cost

the quantity sold is less than the equilibrium quantitiy

deadweight loss refers to

the reduction in economic surplus resulting from not being in competitive equilibrium

the circular flow model demonstrates

the roles played by households and firms in the market systems

the substitution effect of a price change refers to

the shift in the demand curve due to a change in purchasing power bought about by the price change

if in the market for apples the supply has decreased,then ...

the supply curve for apples has shifted to the left

each point on the demand curve shows

the willingness of consumers to purchase a product at different prices

which of he following is an example of spending on factors of production in the circular flow model?

the ¨Lucky Ducky¨ casino buys a new craps table for the casino floor

which of the following describes a characteristic of a perfectly competitve market?

there are many buyers and sellers

How is the market for pest control affected by this?

there is a decrease in the supply of pest control services

FIGURE- at a price of $5.....

there is a shortage of 4 units

FIGURE-if there is a surplus of motorcycles how will the equilibrium point change?

there will be no change in the equilibrium point

Which of the following best describes an assumption economist make about human behavior

they assume that rational behavior is useful in explaining choices people make even though people may not behave rationally all the time

without technological advancement, how can a nation achieve economic growth

through an increase in supplies of factors of production

T/F the substitution effect explains why there is an inverse relationship between the price of a product and the quantity of the product demanded

true

if the population increases and input prices increase, the equilibrium price of a product will indefinitely increase.

true

what is Jacks opportunity cost of mowing a lawn

two-thirds of a a garden cultivated

which of the following is a positive economic statement

unemployment insurance payments increase when the unemployment rate rises

the resource income earned by those who supply labor services is called

wages and salaries