Macro Econ

To reach point L, the economy would have to

acquire more resources or experience a technological advance.

Normative statements are

prescriptive, whereas positive statements are descriptive.

Inefficient production is represented by which point(s)?

T

Unemployment could cause this economy to produce at which point(s)?

T

Which of the following is a positive, as opposed to a normative, statement?

The US Department of Justice sued AT&T to block its merger with T-Mobile.

Which of the following is an example of a normative - as opposed to a positive - statement?

The government should increase the tax on gasoline.

The opportunity cost of this economy moving from point I to point H is

120 blankets

If this economy devotes all of its resources to the production of blankets, then it will produce

360 blankets and 0 pillows.

The opportunity cost of this economy moving from point I to point F is

40 blankets

If the production possibilities frontier is bowed outward, then "?" could be Tennis Rackets 100, 200, 300 Tennis Balls 8000, 6500, ?

4500

Which arrow represents the flow of spending by households? Look at arrow from G and S to Firms

A

Raymond buys a refrigerator for his new home. To which of the arrows does this transaction directly contribute?

A and B

On a bowed production possibilities frontier, as you move down along the curve

All of the above are correct

A movement from point H to point K could be caused by

All of the above are correct.

Which arrow represents the flow of goods and services? Look at arrow from firms to G and S

B

Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of each car is

Both a and b are correct.

Which arrow represents the flow of land, labor, and capital? Look at arrow from F of P to Firms

C

Harvey receives his first paycheck for working as an ice cream vendor. To which of the arrows does this transaction directly contribute?

C and D

Which arrow represents the flow of income payments? Look at arrows from Firms to F of P

D

The production possibilities frontier illustrates

None of the above is correct.

This economy cannot produce at which point(s)?

Q, S

This economy has the ability to produce at which point(s)?

R, T, U

Efficient production is represented by which point(s)?

R, U

If this economy moves from point F to point G, then which of the following statements is correct?

This economy has experienced economic growth.

At which point is this economy producing its maximum possible quantity of doors?

U

Positive statements are

claims about how the world is.

In the circular-flow diagram, which of the following items flows from firms to households through the markets for goods and services?

goods and services

According to the circular flow diagram, if Suzy is a worker who delivers flowers for Happy Day Flower Company, she participates

in the markets for factors of production exchanging labor for income.

For this economy, as more and more hammers are produced, the opportunity cost of an additional hammer produced, in terms of nails,

increases

In the circular-flow diagram, which of the following items flows from households to firms through the markets for the factors of production?

land, labor, and capital

Consider the production possibilities frontier for an economy that produces only sofas and cars. When society moves from point A to point B,

the opportunity cost is the same as when society moves from point B to point C.

Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of each car is

the slope of the production possibilities frontier.

In the circular-flow diagram, which of the following items flows from firms to households through the markets for the factors of production?

wages, rent, and profit