ECON 201B Exam 1

Which of the following lists includes only capital resources ?

Autos owned by a car rental firm; computers at the Hertz car rental agency; the vans that shuttle rental customers to and from the airport

Which of the following is a normative economic statement?

Government must maintain the current level of defense spending to keep the nation safe

Which of the following best explains the difference between neoclassical economics and behavioral economics?

Neoclassical economics assumes that people are rational in their decision making, while behavioral economics believes people make systematic errors.

Sue wants to buy the latest novel by her favorite author. The economic perspective suggests that Sue will buy the book if

The marginal benefit of the book the is more than its marginal cost

Which of the following will not produce an outward shift of the production possibilities curve?

The reduction of unemployment

The process of observing real-world behavior, developing hypotheses, testing them against facts, then using the results to construct theories is called:

The scientific method

Which of the following exemplifies a microeconomic question?

Will a new type of electronic reader or tablet increase the number of buyers?

microeconomics

choices made by individuals firms and industries

waiters and waitresses are considered what in econ?

labor

lettuces and fresh vegetables are considered what in econ?

land

Answer the question on the basis of the data given in the following production possibilities table: Refer to the table. For these data, the law of increasing opportunity costs is reflected in the fact that:

larger and larger amounts of capital goods must be sacrificed to get additional units of consumer goods.

this demand determinant has consistent stability, making decisions way easier in terms of investments

number and composition of consumerst

an oven and gas range is considered what in econ?

physical capital

The downward slope of the demand curve again illustrates the pattern that as _________________ rises, _________________ decreases.

price, quantity demanded

When economists say that people act rationally in their self-interest, they mean that individuals:

pursue opportunities to increase their utility

refers to the total number of units that are purchased by consumers at a specific price

quantity demanded

When economists talk about supply, they are referring to a relationship between price received for each unit sold and the _________________ .

quantity supplied

factors of production

resources used to make goods and services

macroeconomics

studies the economy as a whole

Even though local newspapers are very inexpensive, people rarely buy more than one of them each day. This behavior can best be explained as

the marginal benefit of reading a second newspaper is less than the marginal cost

According to the law of supply:

there is a direct relationship between price and the quantity supplied.

Brianna says that "gas prices are rising because there aren't enough oil refineries." Claire argues that "gas prices are rising because of the growing demand for gasoline in the U.S." We can conclude that:

Both statements are positive

Along a linear downward-sloping demand curve, the price elasticity of demand will be:

Different across each price range

Which of the following is a positive economic statement?

Stock prices rose to new record in the last month for the fourth month in a row

rational self interest

assumption that humans will make choices to maximize their utility

the price elasticity of demand coefficient measures

buyer responsiveness to price changes

What are the economic goals of the United States?

economic growth, low unemployment, and low inflation

a restaurant owner is considered what in econ?

entrepreneurial ability

culinary school is considered what in econ?

human capital