Econ 2002 Buser Quiz Answers

Samsung is a South Korean smartphone producer, and a semiconductor is one of the most essential parts of smartphones. Japan, a major provider of this high-tech material, recently announced that it will stop exporting to South Korea. As a result, the supply of Samsung for smartphones will: a. Shift to the left b. Not shift, but its production will move along the supply curve upward and to the right c. Shift to the right d. Not shift, but its production will move along the supply curve upward and to the left

a

Students who never miss class and study hard generally earn higher grades than those who do not. This is an example of: a. incentives b. specialization c. market failure d. marginal cost

a

The table below shows a demand schedule and a supply schedule for tomatoes. What are the equilibrium price and quantity for tomatoes? Price | Quantity Demanded | Quantity Supplied $1 | 11 | 9 $2 | 10 | 10 $3 | 9 | 11 $4 | 8 | 12 $5 | 7 | 13 a. Price = $2, Quantity = 10 b. Price = $4, Quantity = 12 c. Price = $2, but the quantity depends on what suppliers are willing to supply d. Both price and quantity depend on where the supply and demand curves cross, which we do not have enough information to say

a

Which of the following statements is true? a. One way to create economic growth is to improve the technology that is available for production b. The production possibilities frontier cannot be changed c. Changes in the quality of resources do not affect economic growth d. Using our resources more efficiently will shift the production possibilities frontier outward

a

Which situation deals more with equity than efficiency? a. The Red Sox sign a star player for $35 million a year, which is over 10 times the average salary of the rest of the team b. Due to a lack of customers, Jamie's Pizza reduced the number pepperoni slices on each pizza c. Mike's Auto Shop invests in a new hydraulic lift that makes it easier to change oil and rotate tires d. Howards Realty offers his sales staff a bonus incentive if the annual sales goal is reached

a

A construction crane is an example of _______. a. labor b. physical capital c. land d. entrepreneurship

b

A supply curve shows the relationship: a. Between price and income b. Between price and quantity supplied c. Among income, price, and quantity supplied d. Between income and quantity supplied

b

At an amusement park, Sue achieves an enjoyment value of 10 on her first roller coaster and a total enjoyment value of 16 after her second ride. Her marginal benefit from her second ride is: a. 4 b. 6 c. 8 d. 16

b

Specialization and trade ____. a. Can benefit one side or the other, but never both b. Allows each side of the trade to produce beyond their individual PPFs c. Enables one side of the exchange to gain at the expense of another d. leaves both sides in the exchange worse off

b

The MOST common way in which economists model a problems is by: a. making sure as many details and facts are included b. simplifying the model down to its basic relevant elements c. avoiding assumptions as much as possible in order to avoid misrepresenting reality d. using case studies to analyze individual real-life examples of problems

b

In which market is government most likely to intervene to prevent a market failure? a. the restaurant market b. the market for college education c. the market for designer clothing d. the jewelry market

c

Suppose in the market for iPhones, the following two changes take place: (1) the cost of making iPhones falls, and (2) the price of smart-phone data plans fall. What happens to the equilibrium price and quantity? a. the equilibrium price and equilibrium quantity rise b. The equilibrium price falls, but the equilibrium quantity is indeterminate c. The equilibrium price is indeterminate, but the equilibrium quantity rises d. The equilibrium price rises, but the equilibrium quantity is indeterminate

c

Tim woke up this morning with a stomachache and decided to skip class in order to get more rest. What is the opportunity cost of Tim's decision to sleep in? a. the improvement in how he feels by getting more rest b. the level of pain he endured from the stomachache c. the value of attending the class he decided to miss d. the actual enjoyment of lying in bed instead of attending class

c

When an economy uses the most efficient means of farming to grow as much corn as possible, this economy has achieved: a. Production efficiency and allocative efficiency b. Neither production efficiency nor allocative efficiency c. production efficiency but not necessarily allocative efficiency d. allocative efficiency but not necessarily production efficiency

c

Which headline would be LEAST likely to be studied in macroeconomics? a. Economic Growth Rises Slowly and Steadily b. Unemployment Falls to a 7-Year Low c. GM Expands Car Sales in China d. The Fed Raises Interest Rates

c

Jane can bake 15 pies in a day. Alternatively, she can change the oil in 10 cars. Assuming her production possibilities curve has a constant slope, Jane's opportunity cost of producing a pie is _____. a. 1 oil change b. 10 oil changes c. 2/3 of an oil change d. 1 and 1/2 oil changes

c P.S. opportunity cost is what you give up to do an activity. Divide the amount of oil changes by the amount of pies because we want to know what Jane gives up by making pies.

Rainbow Land produced $400,000 of goods last year and $450,000 of goods this year. What was the percentage change in production? a. 1.11 b. 0.13 c. 12.50 d. 50,000

c P.S. subtract the old value from the new value, then divide by the old value, and then multiply by 100

Another way of referring to a market economy is as a: a. demand economy b. supply economy c. ceteris paribus d. price system

d

Which policy is MOST likely to contribute to improved standards of living over time? a. Addressing teacher shortages by closing schools and busing students to other schools b. Allowing individuals the freedom to circumvent laws due to personal objections to them c. Reducing the years that drug patents are valid to speed up production of generic versions d. Adding after-school art and music programs to promote creativity

d

Which question is considered a normative question? a. How many people participated in obstacle course racing last year? b. How much money does an entry into an obstacle course race cost? c. When and where are then major obstacle races held? d. Should obstacle races be regulated to ensure the safety of its participants?

d

The diagram below represents a ________ between the x variable and the y variable a. An increasing relationship b. A decreasing relationship c. A negative relationship d. A positive relationship | / | / | / | / | / | / |/________________________________

d P.S. The next question asked about the slope of the graph. Remember change in y divided by change in x!