Chapter two quiz-Economics
can be shown to be correct or incorrect
A positive statement is - a value statement - can be shown to be correct or incorrect - based upon an optimistic judment - reflects ones opionions
the law of diminishing returns
Because of ________ if a city government decides to spend money on beautifying its downtown and attracting tourism to its city when no money has been devoted to those efforts before, then gains in tourism may be significant. - the opportunity cost of the production possibility trade off - the law of diminishing returns - the production possibility frontier
2 watches
Consider the Production Possibility Frontier for country X producing 2 groups of goods, MP3 players and watches. The opportunity cost of moving from the combination of MP3 players and watches B to C is - 5 MP3 players - 15 MP3 players - 4 watches - 2 watches
A two year opportunity cost of 40,000 after leaving her teaching position
Dawnell is a skilled dancer. She is currently teaching modern dance full time for three high schools and makes $44,000 a year. She is now giving up her work and joining a touring dance company for the next two years. She will make $24,000 a year dancing, but gain much more in experience and connections. Dawnell's decision will result in - a one year opportunity cost of $24,000 after leaving her teaching position - a two year opportunity cost of $40,000 after leaving her teaching position.
Scarcity
Economics deals primarily with the concept of - banking - money - scarcity - poverty
San Francisco
Every day, 500 airplanes in San Francisco incur an additional 30 minutes of airport delays when flying into or out of the airport. In Chicago, the delays amount to 15 minutes for 1,200 airplanes. If the price of time is $30/hour in San Francisco and $20/hour in Chicago, which airport incurs the largest opportunity cost? - Chicago - San Fransicso
The federal government spends too much.
Identify the normative statement among the following - The federal governments spending is greater than its revenue to the treasury - The Federal governments spending too much - The Federal government budget deficit reached 4% of GDP last year. - The federal government has increase its spending by 5% last year.
the prices of the goods that a person can purchase
Scarcity is imposed on individual households in the form of income and - sink costs - the prices of the goods that a person can purchase - limited production - utility
drivers who value speed and convenience more than those in the stop and go lanes and are willing to pay additional express pass fees for the option of avoiding traffic jams.
Some highways have commuter or express pass lanes. During rush hour lanes on the highway move slowly or often are stop and go, but the express lanes continue to move at a faster pace. Express pass users pay for a transponder and monthly fees to have express lane access even with no other people in their cars. In this example, the drivers who purchase these express passes are probably - experiences drivers that know that the best way to avoid commuter lines on the freeway is to leave home earlier to get to work - more important than drivers waiting in the longer commute lines on the freeway -drivers who value speed and convenience more than those in the stop and go lanes and are willing to pay additional express pass fees for the option of avoiding traffic jams - not patient enough to wait with the others
Congress gives too many tax breaks to corporations.
Which of the following statements is normative? - Tax breaks can change corporate behavior. - Congress gives certain business corporations tax breaks. - Tax breaks can lead to additional production. - Congress gives too many tax breaks to corporations.
