Chapter 1 Quiz, Chapter 2 Quiz, Micro Chapter 3 Quiz, Micro Chapter 4 Quiz, Micro Chapter 5 Quiz
A country is categorized as a low-income economy by the World Bank if its per capita income is below:
$1,000.
n a given year, country A exported $12 million worth of goods to country B and $6 million worth of goods to country C; country B exported $4 million worth of goods to country A and $7 million worth of goods to country C; and country C exported $5 million worth of goods to country A and $2 million worth of goods to country B. According to Scenario 4-1, country A has net exports of:
$9 million.
It can be said that ____ laid the foundation for the Industrial Revolution.
. private property rights
If the nation depicted in Figure 2.3 is producing at combination E, the opportunity cost of producing the tenth unit of consumer good is:
1 unit of capital good.
The city of Austin can buy roads or light rail. If 10 miles of roads cost $1 million and 2 miles of light rail cost $10 million, what is the city's opportunity cost of 1000 miles of roads?
100 Million
Total government spending in the U.S. economy was around _____ of the GDP in the financial year 2010.
36%
Which of the following statements is a defining feature of a corporation?
A corporation has a legal identity that is separate from that of its owners.
Which of the following will bring about an inward shift of a production possibilities curve [PPC]?
A decrease in the availability of natural resources
Which of the following is likely to cause an outward shift of a production possibility curve?
An improvement in the available technology
Which of the following is a possible drawback of horizontal fracking?
An increase in harmful air emissions, water contamination, and problems associated with the disposal of harmful waste fluids
Bob and Bill can make 16 toys each if they devote 8 working hours in a day. Further, Bob can repair 4 cars and Bill can repair 2 cars, if they devote 8 working hours in a day. When these two individuals engage in trade, it would be advantageous for both if:
Bob specializes in car repairing and Bill specializes in the production of toys.
National economic policies are usually set by the local government in the U.S., making it the focus of economic discussions.
FALSE
According to economists, human activity is unresponsive to changes in costs.
False
An example of barter is voluntary work at an old-age home.
False
Consumption or household spending of an economy comprises of both consumer spending and business spending.
False
Empirical evidence suggests that the federal budget has remained more or less in surplus between 1990 and 2002.
False
One of the assumptions of an economic analysis is that market functions are controlled by the government.
False
There is no cost of using your own savings in your business.
Flase
Refer to figure 5.1. Assume that the economy is initially at point G on the production possibility curve. To consume an amount of luxury good, shown by the distance O to L, the country will have to give up a quantity of necessity good, indicated by the distance _____.
G to N
Which of the following flows from the government to the households?
Government services
The figure given below represents an economy producing corn and planes under different economic situations. Refer to Figure 2.2. Assume that the economy experiences a 20% drop in the work force. Which of the following graph(s) in the figure describe(s) the change in the economy's production possibilities curve [PPC]?
Graph A
Which of the following is a possible outcome of a minimum wage imposed by a government?
It creates a labor surplus or unemployment.
Which of the following is a defining feature of a multinational firm?
It owns and operates production facilities in more than one country.
What do you mean by the term 'free market'?
It refers to the process whereby buyers and sellers voluntarily interact or trade without any interference or restrictions.
The table given below represents butter and ham production by two countries Norway and Sweden. Refer to Table 2.5 and identify the correct statement.
It would be advantageous for Sweden to trade with Norway
Which of the following statementsWhich of the following statements is false? a. Economists do not ask whether a particular decision is in the individual's best interest. b. None of these statements is false, they are all true. c. Economists look at the factors that lead an individual to decide that a particular idea is in his or her best interest. d. A particular choice is made by an individual because that choice provides the greatest satisfaction. e. Choices must be made because of scarcity.
None of these statements is false, they are all true.
The table given below represents the output per hour of cookies and chilies in Ohio and Iowa. Refer to Table 2.4. Identify the correct statement.
Ohio should specialize in the production of cookies and trade with Iowa
Which of the following statements is true?
Over time, when demand for health care continues to rise relatively more than supply , the cost of health care continues to rise.
The figure given below represents the equilibrium in the market for bicycles under different demand and supply situations. The vertical axis in each panel shows the price of bikes. Refer to Figure 3.2. Which of the following panels represents the equilibrium situation in the bicycle market, if there were an increase in the price of metal used in the production of bicycles?
Panel C
Which of the following economic indicators is used by the World Bank to classify countries as industrial or emerging economies?
Per capita income
Every Friday night Elizabeth either goes bowling or goes to the movies. Because the price of bowling went up, Elizabeth now sees more movies. Elizabeth's behavior would be best described as a change in which determinant of demand?
Price of substitute goods
Which of the following is true?(3)
Sellers are willing to supply more of a good or service at every price after costs have decreased.
If a corporation cannot pay its debts, creditors cannot seek payment from shareholders' personal wealth.
T
In general, the purpose of markets is to facilitate the exchange of goods and services between buyers and sellers.
T
The income transferred by the government from a citizen who is earning income to another citizen is referred to as:
TP
Which of the following is an example of opportunity cost?
The Chinese food that you give up when you choose to eat Italian food.
Which of the following is true of U.S. net exports prior to the 1960s?
The U.S. was running a trade surplus prior to the 1960s
The below figure shows the demand and supply of DVD rentals in a city. S1 and D1 are the original supply and demand curves. The demand curve shifts from D1 to D2. Refer to Figure 3.4 and identify the true statement.
The demand for DVD rentals has decreased
Which of the following observations is true of the federal budget between 1960 and 2010?
The federal budget deficit was lower than 600 billion dollars in 2010.
Which of the following is true of the law of supply?
The law of supply states that as the price of a good rises, the quantity supplied rises
Which of the following statements is not true about a market system?
The market system magnifies the problem of scarcity of goods and services.
Which of the following will cause an increase in the quantity demanded of ice cream at an ice cream store?
The store introduces a limited period offer of 20 percent off on the price of ice cream.
Which of the following possibly determines the allocation of goods and services in a free market?
The willingness and ability of consumers to pay for the product
Refer to figure 5.3. Suppose the government imposes a minimum wage of $8. Which of the following is a possible outcome of the imposition of a minimum wage above the equilibrium wage rate?
There will be a fall in the quantity of jobs offered, from Q to QI, and an increase in the quantity of labor supplied, from Q to QII.
Which of the following is true of Western Europe, Japan, Canada, Mexico, and China taken together?
They are collectively the largest trade partners of the U.S.
Following is the production possibilities schedule for an economy producing two goods, Good A and Good B. Refer to Table 2.1. Identify the correct statement.
This economy can produce 70 units of A and 40 units of B.
A person obtains income by selling the services of the resources that he or she owns.
True
Hydraulic fracking involves pumping millions of gallons of chemically treated water into the wells at pressures of 9,000 pounds per square inch or more.
True
Refer to figure 5.2. A shift in the supply curve from S to S1leads to:
a fall in price from P to P1 and an increase in quantity supplied from Q to Q1.
The table given below reports the quantity demanded and supplied of a commodity at different prices in a market. Refer to Table 3.5. If government imposes a price ceiling of $2:
a shortage will result equal to 20 units.
When people make choices that (at the time and with the information they have at their disposal) give them the greatest amount of satisfaction, they are said to be:
acting in their own self-interest.
The market demand curve is derived by:
adding up the quantities that consumers in a market are willing and able to purchase at each price.
Consider the production possibilities curve for an economy producing only two commodities wheat (represented on the X axis) and wine (represented on the Y axis). A movement up along the production possibilities curve [PPC] will imply:
an increase in wine production
A decrease in the quantity of available resources would be represented by:
an inward shift of the PPC
A good or service is said to be scarce when:
at a price of zero, there is not enough to satisfy everyone's desire for it.
Other things remaining the same, if a large part of the population decided against having soda for health reasons, there would be a(n):
decrease in the price of soda.
Ceteris paribus, a change in the quantity supplied along the supply curve of Braun coffee makers is:
directly related to the price of a Braun coffee maker.
Most markets involve the use of money for transactions because:
goods and services can be exchanged more easily with money than without it.
The table given below reports the quantity of bread loaves demanded and supplied at different per unit prices. Refer to Table 3.3. Which of the following would occur in the market for bread if the market price exceeded the equilibrium price by $1?
he bread market would face a surplus of 36 loaves of bread.
The term net exports refers to:
he difference between the value of exports and the value of imports.
Which of the following sectors in the economy accounted for about 70% of the spending in the U.S. during 2009?
house holds
The output level that occurs in any market that is in equilibrium:
is the quantity where the demand and supply curves intersect each other.
The _____ tend to have a smaller public sector relative to the total economy.
market economies
Shirley can choose between peanut butter pretzels and caramel coated popcorn for her evening snack. According to economists, her _____ cost of consuming caramel coated popcorn would be the forgone peanut butter pretzels.
opportunity
The phrase in the text, 'human beings are self-interested, not selfish' means that:
people contribute to charities and they help others.
The term self-interest, as viewed by economists, means that:
people make choices that, given the information available, gives them the greatest amount of satisfaction.
A point outside the production possibilities curve [PPC]:
represents more resources than are currently available.
Margarine and butter can both be used as a spread on toast. This means that they are:
substitute goods
People (and all resources):
tend to specialize in those activities in which their opportunity costs are minimized.
Other things remaining the same, an individual demand schedule shows the various quantities of a good:
that a person wants and is able to purchase at alternative prices.
If the resources within a nation are not being fully or efficiently utilized, it means:
that the nation is operating at a point inside its production possibilities curve.
Refer to Figure 2.1. If the country has curve I as its PPC, then _____ would most likely cause the curve to shift to curve II.
the discovery of new metal resources
A rightward shift of a market supply curve might be caused by:
the entry of new firms in the industry.
The public sector of the U.S. economy includes:
the federal, state, and local government.
The table given below reports the quantity demanded and supplied of a commodity at different prices in a market. Refer to Table 3.5. If government imposes a price ceiling of $4:
the price ceiling will not have an effect.
According to the law of demand, if the price of movie rentals decreases, ceteris paribus,:
the quantity demanded of movie rentals would increase.
Assume that a doctor makes $200 per hour, a lawyer $250 per hour, an architect $140 per hour, a professor $50 per hour, and a waiter $35 per hour. Which of these professionals is most likely to spend time to negotiate with a car dealer?
the waiter
If you have a choice of consuming either two apples, three oranges, or one candy bar, the opportunity cost of the candy bar is:
two apples or three oranges, whichever you value more.
Figure 5.2. The figure shows the supply and demand curves of a firm. Refer to figure 5.2. Which of the following will cause a shift in the supply curve from S to S1?
A decline in the cost of producing the commodity
Which of the following is a possible reason for a comparatively steeper demand curve for health care?
A large increase in price does not cause a reduction in the purchase of health care by the same proportion
Which of the following is true?(2)
A voluntary transaction means that all parties to the transaction must expect to benefit.
Refer to figure 5.1. An increase in the country's gross domestic product will cause:
a rightward shift in the production possibility curve.