Econ Unit 1

The​ _____ that people devote to produce goods and services is labor. A. time and money B. work​ time, and work effort C. money and consumption goods and services D. time

B. work​ time, and work effort

Compared to the developing​ economies, the advanced economies have​ _______ human capital and​ _______ physical capital. A. ​more; more B. ​less; less C. ​more; less D. ​less; more E. the​ same; the same

A. ​more; more

Which of the following statements about the market for chicken describes a change in the quantity demanded and which describes a change in demand​? I People are buying less chicken because the price of beef has fallen. II People are buying less chicken because the price of chicken has increased. III People are buying more chicken because the price of chicken has fallen. IV The cost of chicken feed has increased. A. ​I, II, and III are changes in the quantity demanded and IV is a change in demand. B. I is a change in demand and II and III are changes in the quantity demanded. C. I is a change in the quantity demanded and II and III are changes in demand. D. ​I, II, and III are changes in demand and IV is a change in the quantity demanded.

B. I is a change in demand and II and III are changes in the quantity demanded.

The production possibilities frontier is the boundary between the combinations of goods and services that​ _____, given the available factors of production and the state of technology. A. we want to produce and what we want to consume B. can be produced and the combinations that cannot be produced C. we want to produce but cannot consume D. can be produced and the prices paid for those

B. can be produced and the combinations that cannot be produced

​Tom's opportunity cost of producing a racket is 2 balls. ​Abby's opportunity cost of producing a racket is 5 balls. In the production of​ balls, ______ and​ _____ has a comparative advantage. A. Abby has a lower opportunity cost than Tom​; Tom B. Abby has a lower opportunity cost than Tom​; Abby C. Tom has a lower opportunity cost than Abby​; Tom D. Tom has a lower opportunity cost than Abby​; Abby In the production of​ rackets, _____ and​ _____ has a comparative advantage. A. Abby has a lower opportunity cost than Tom​; Tom B. Abby has a lower opportunity cost than Tom​; Abby C. Tom has a lower opportunity cost than Abby​; Tom D. Tom has a lower opportunity cost than Abby​; Abby

B. Abby has a lower opportunity cost than Tom​; Abby C. Tom has a lower opportunity cost than Abby​; Tom

A substitute is a good that is​ _____ another​ good, and a complement is a good that is​ _____ another good. A. produced in place​ of; sold with B. consumed in place​ of; consumed together with C. consumed together​ with; consumed in place of D. consumed in place​ of; produced with

B. consumed in place​ of; consumed together with

An economy grows when it does all of the following except ​_______. A. acquires more machines to help it produce B. lowers prices C. develops better technologies D. implements​ on-the-job training E. improves the quality of labor by education

B. lowers prices

The law of demand states that​ ______, the​ ______ the price of a​ good, the smaller is the quantity​ demanded; and the​ ______ the price of a​ good, the greater is the quantity demanded. A. even when other factors​ change; lower; higher B. other things remaining the​ same; higher; lower C. even when other factors​ change; higher; lower D. other things remaining the​ same; lower; higher

B. other things remaining the​ same; higher; lower

If the price of a laptop falls​, with all other influences on buying plans remaining the​ same, _______. A. the quantity of laptops demanded decreases B. the quantity of laptops demanded increases C. the demand for laptops increases D. the demand for laptops decreases

B. the quantity of laptops demanded increases

Rising wages pose dilemma for China Chinese​ private-sector wages rose 14 percent in 2012. This trend in rapidly rising wage rates might hurt its manufacturing dominance. ​Source: Wall Street Journal​, May​ 17, 2013 Explain the effect of the rising wage rates on the supply of manufactured goods. Rising wage rates​ ________ . A. increase both the supply of and demand for​ China's manufactured goods and will have no effect on​ China's dominance B. decrease the demand for​ China's manufactured goods and hurt​ China's dominance C. increase the cost of production​ and, with no change in​ productivity, China's supply of manufactured goods will decrease D. increase the cost of production​ and, with no change in​ productivity, China's supply of manufactured goods will increase E. increase both productivity and the cost of production and will not influence​ China's supply of manufactured goods

C. increase the cost of production​ and, with no change in​ productivity, China's supply of manufactured goods will decrease

Bonnie and Enid each own an ice cream parlor. In an​ hour, Bonnie can produce 9 milkshakes or 9 ice cream sundaes and Enid can produce 11 milkshakes or 66 ice cream sundaes. Bonnie​'s opportunity cost of producing 1 milkshake is 1 ice cream sundaes. Enid​'s opportunity cost of producing 1 milkshake is 6 ice cream sundaes. _______ has a comparative advantage in milkshakes and​ _______ has an absolute advantage in both goods. A. Enid​;Enid B. Bonnie​;Bonnie C. Bonnie​; Enid D. Enid​;Bonnie

C. Bonnie​; Enid

Choose the correct statement. A. Economic growth abolishes scarcity. B. There is no tradeoff associated with economic growth. C. The cost of economic growth is fewer consumption goods today. D. The cost of economic growth is fewer consumption goods in the future. E. With economic​ growth, production becomes a free lunch.

C. The cost of economic growth is fewer consumption goods today.

Suppose that the United States and Cuba decide to open up trade. If each country specializes in the good in which it has a comparative​ advantage, ______ will gain from that trade because​ ______. A. only the United​ States; consumption possibilities in Cuba will lie outside its PPF and U.S. consumption possibilities will not change B. only​ Cuba; consumption possibilities in Cuba will lie outside its PPF and U.S. consumption possibilities will not change C. both​ countries; consumption possibilities in both Cuba and the United States will lie outside their PPFs D. neither​ country; their consumption possibilities will not change

C. both​ countries; consumption possibilities in both Cuba and the United States will lie outside their PPFs

For​ consumers, Upper T -shirts and tank tops are substitutes. If the price of a Upper T -shirt decreases​, the demand for tank tops will​ _______. A. increase or​ decrease, but the demand for Upper T -shirts will not change B. not​ change, but there will be a movement along the demand curve for tank tops C. decrease​, and the demand curve for tank tops will shift leftward D. increase​, and the demand curve for tank tops will shift rightward

C. decrease​, and the demand curve for tank tops will shift leftward

Human capital​ _____ that people obtain from​ education, on-the-job​ training, and work experience. ​_____ that have been produced in the past and that businesses now use to produce goods and services is capital. A. are goods and​ services; Inputs B. are​ inputs; Natural resources and other goods C. is the knowledge and​ skill; ​Tools, instruments,​ machines, buildings, and other items D. are productive​ resources; Inputs and outputs

C. is the knowledge and​ skill; ​Tools, instruments,​ machines, buildings, and other items

Explain how each of the following events changes the demand for or supply of jeans. A. The wage rate paid to garment workers falls. B. Many jeans producers go out of business. C. The price of a denim skirt halves. D. People's incomes increase. E. Upper A new technology becomes available that reduces the time it takes to manufacture a pair of jeans. F. The price of the cloth left parenthesis denim right parenthesis used to make jeans falls. G. Jeans go out of fashion. H. The price of a pair of jeans falls. A. Event B increases supply and event G increases supply. B. Event C increases demand and event D increases supply. C. Event E increases demand and event F increases supply. D. Event A increases supply and event B decreases supply. E. Event G decreases demand and event H increases demand.

D. Event A increases supply and event B decreases supply.

Which of the following statements is about a normal good​, which is about an inferior good​, which is about​ both, and which is about​ neither? I With incomes falling in the​ recession, people are buying more chicken. II People are buying more beef now that incomes have increased. III People are buying more chicken because the price of chicken has fallen. IV With higher incomes people are switching from chicken to beef. A. IV is​ inferior, III is​ normal, II is​ neither, and I is both B. III is​ inferior, II is​ normal, IV is​ neither, and I is both C. II is​ inferior, I is​ normal, III is​ neither, and IV is both D. I is​ inferior, II is​ normal, III is​ neither, and IV is both

D. I is​ inferior, II is​ normal, III is​ neither, and IV is both

Paula graduates from college and her income increases by ​$35 comma 000. Nothing else changes. Paula decreases the quantity of ketchup and french fries that she buys and increases the quantity of winter vacations that she buys. For Paula​, ​_______. A. winter vacations and french fries have become substitutes B. ketchup and winter vacations are inferior goods C. ketchup and french fries are normal goods D. winter vacations are normal goods

D. winter vacations are normal goods

Production efficiency is a situation in which the economy is getting all that it can from its resources and​ _____ produce more of one good or service without producing​ _____ of something else. A. ​cannot; more B. ​can; less C. ​cannot; equal D. ​cannot; less

D. ​cannot; less

Consider the U.S. market for Caribbean cruises. Suppose people expect the price of a Caribbean cruise to rise next season. Explain the effect of this event on the quantity of Caribbean cruises demanded and on the demand for Caribbean cruises. A. The demand for Caribbean cruises decreases. B. The quantity of Caribbean cruises demanded decreases and the demand for Caribbean cruises also decreases. C. The quantity of Caribbean cruises demanded decreases. D. The quantity of Caribbean cruises demanded increases. E. The demand for Caribbean cruises increases.

E. The demand for Caribbean cruises increases.

Consider the market for smartphones. Suppose the price of a smartphone falls. Explain the effect of this event on the quantity of smartphones demanded and on the demand for smartphones. A. The quantity of smartphones demanded is unchanged and the demand for smartphones increases. B. The quantity of smartphones demanded decreases and the demand for smartphones also decreases. C. The quantity of smartphones demanded decreases and the demand for smartphones is unchanged. D. The quantity of smartphones demanded increases and the demand for smartphones also increases. E. The quantity of smartphones demanded increases and the demand for smartphones is unchanged.

E. The quantity of smartphones demanded increases and the demand for smartphones is unchanged.