econ quiz questions

Statements that are a hypothesis or statement of fact are:

Positive

The current rate of unemployment is 5 percent. This statement is:

Positive

The primary difference between a change in supply and a change in the quantity supplied is:

a change in quantity supplied is a movement along the supply curve, and a change in supply is a shift of the supply curve.

would not change the demand for automobiles?

a change in the cost of steel

The problem of scarcity is confronted by:

all societies

Which of the following always results in an increase in price and quantity?

an increase in demand with no change in supply

Those things held unchanged when an equilibrium price is established:

are called demand shifters if a change in one (or more) of them would change demand.

A model or theory in economics is:

built using relevant observations, assumptions, and abstractions.

Price controls:

can result in inequitable outcomes.

Over the last few decades government has decreased its participation in health care. T or F

False

The Oregon Plan for the provision of health care to people living below the poverty line generally increased the number and type of procedures for which they were eligible. T or F

False

A tradeoff between two economic goals means that:

if you achieve more of one, you will achieve less of the other.

The textbook suggests that: technology has greatly ________ health-care costs.

increased

The Case in Point on "baldness and heart disease" suggests that by preventing baldness:

men are unlikely to influence their chances of having heart problems.

Most economists' disagreements are a result of:

normative considerations.

In general, production possibilities curves are "bowed out" because:

of the law of increasing opportunity cost.

The slope of a production possibilities curve is based on:

opportunity cost.

The key signals that send messages to buyers and sellers to buy or not to buy or to sell or not to sell are, all other things unchanged:

prices

The price of eggs might go up because:

the price of chicken feed increased.

If countries do not engage in international trade:

they give up the ability to specialize in production. worldwide levels of production are lower. the world will be operating inside its production possibilities curve.

An arrangement in which consumers choose their health-care services while other institutions pay a share of the cost of those services is called a(n) ________ payer system.

third-party

An area of concern in the provision of health care in the United States is that:

too many resources are devoted to health care.

In terms of equity, existing farm policies tend to help:

wealthy farmers more than poor farmers.

The fundamental economic questions that every economic system must answer are:

what, how, and for whom.

The economic way of thinking includes:

the assumption that individuals choose to maximize some objective.

Plastic and steel are substitutes in the production of automobiles. If steel prices go up, all other things unchanged:

the demand curve for plastic will shift to the right.

In the stock market:

the demand for stocks in recent years has been greatly affected by demographic change and rising incomes.

In the 1990s, the percentage of total output the United States devoted to health care was about ________ percent.

13

capital

A factor of production that has been produced for use in the production of other goods and services, A factor of production that is produced in order to produce something else' For a factor of production to be called capital it must be produced

Assume a market initially exhibits a shortage. Assuming that both prices and quantities are flexible, which of the following will be true after the market adjusts to equilibrium?

Quantity supplied is more

A shortage results from a current price being below the equilibrium price. T or F

True

As the fraction of health-care costs paid by consumers falls, their quantity of health-care services consumed increases. T or F

True

By limiting the number and type of procedures it would cover, the Oregon Plan for health-care insurance for the poor was able to increase the number of people included in its coverage. T or F

True

Economists pay special attention to making choices at the margin. T or F

True

Health-care spending as a percentage of total U.S. output generally rose between 1960 and 1995. T or F

True

An increase in the price of football tickets will cause the ________ for (of) basketball tickets (a substitute) to ________ .

demand; increase

In enforcing the legal system, the government in a market capitalist economy acts to:

enforce contracts. enforce property rights. discourage fraud.

Those who make economic policy concerning price controls often do so in order to:

establish a more equitable result based on normative judgements.

Third-party payer systems for health-care services include payments made by:

government

Governments often establish rules that influence how an economy operates. Which of the following rules will most likely increase the ability of society to produce goods and services?

providing tax incentives to encourage education by workers

One source of high health care costs is the:

relatively large fraction of health care expenditures paid by third-party payers.

According to the textbook, what limits health-care spending?

requiring patients to pay a larger share, government regulation, the use of insurance companies that limit spending.

The Case in Point on oil extraction implies that the environmental damage associated with future oil extraction is likely to :

rise because more environmentally invasive procedures will be required to extract oil.

According to the textbook, much of the discussion about the health-care "problem" in the United States has focused on:

rising spending for health care. note:Subscribers to insurance plans may pay a small percentage of the cost of the health care they consume.

The Case in Point on earnings of economics majors provides data that indicates:

students who major in economics tend to have higher earnings than those who major in other social sciences.

In the market for personal computers and in the stock market:

supply and demand shifts change prices and quantities, persistent shortages and surpluses rarely exist, in response to shifts in supply and demand, equilibrium is restored quickly.

Price ceilings which lead to shortages will impose costs on society because they:

will lead to long waiting lines, may result in black market prices, which are higher than the market-determined price would be, lead to a smaller quantity offered on the market.