Macro

Which of the following statements is true? a Microeconomics focuses on specific decision-making units of the economy; macroeconomics examines the economy as a whole. b Macroeconomics focuses on specific decision-making units of the economy; microeconomics examines the economy as a whole. c Every topic in economics is either a microeconomic or a macroeconomic issue; a topic cannot be both. d Topics in microeconomics have public policy implications; topics in macroeconomics do not.

a Microeconomics focuses on specific decision-making units of the economy; macroeconomics examines the economy as a whole.

Which of the following is a labor resource? a a computer programmer b a computer c silicon (sand) used to make computer chips d software used by a firm

a a computer programmer

Through specialization and international trade, a nation a can attain some combination of goods lying outside its production possibilities curve. b can move from a high consumption-low investment to a high investment-low consumption point on its production possibilities curve. c will only attain some combination of goods lying within its production possibilities curve. d will cause its production possibilities curve to shift leftward.

a can attain some combination of goods lying outside its production possibilities curve

Which of the following terms implies the least degree of confidence in an economic generalization? a hypothesis b theory c principle d law

a hypothesis

A production possibilities curve illustrates a scarcity. b market prices. c consumer preferences. d the distribution of income.

a scarcity.

Economics involves marginal analysis because a. most decisions involve changes from the present situation. b. marginal benefits always exceed marginal costs. c.marginal costs always exceed marginal benefits. d. much economic behavior is irrational.

a. most decisions involve changes from the present situation.

Which one of the following is a normative economic statement? a The unemployment rate fell for the fourth straight month, reflecting the effects from stronger economic growth in the second quarter. b The worsening balance of trade must be corrected if this nation is to remain competitive in the world economy. c Consumer prices are rising at a faster rate than in past months, indicating a renewal of inflationary pressures on the economy. d To help balance the Federal budget, Congress increased the tax on gasoline to its highest level in the past 10 years.

b The worsening balance of trade must be corrected if this nation is to remain competitive in the world economy.

Microeconomics is concerned with a the aggregate or total levels of income, employment, and output. b a detailed examination of specific economic units that make up the economic system. c positive economics, but not normative economics. d establishing an overall view of the operation of the economic system.

b a detailed examination of specific economic units that make up the economic system.

The production possibilities curve has a a positive slope that increases as we move along it from left to right. b a negative slope that increases as we move along it from left to right. c a negative slope that decreases as we move along it from left to right. d a negative slope that is constant as we move along it from left to right.

b a negative slope that increases as we move along it from left to right.

The budget line shows a the amount of product X that a consumer is willing to give up to obtain one more unit of product Y. b all possible combinations of two goods that can be purchased, given money income and the prices of the goods. c the minimum amount of two goods that a consumer can purchase with a specific money income. d all possible combinations of two goods that yield the same level of utility to the consumer.

b all possible combinations of two goods that can be purchased, given money income and the prices of the goods.

Kara was out jogging and, despite being tired, decided to run one more mile. Based on her actions, economists would conclude that Kara a must be an avid runner. b decided that the marginal benefit of running one more mile would outweigh the cost of the additional mile. c decided that the marginal cost of running one more mile would outweigh the benefit of the additional mile. d was not very tired, so the marginal cost of the extra mile was very low.

b decided that the marginal benefit of running one more mile would outweigh the cost of the additional mile.

As a consequence of the problem of scarcity, a there is never enough of anything. b individuals have to make choices from among alternatives. c only some people can "have it all." d things which are plentiful have relatively high prices.

b individuals have to make choices from among alternatives.

The opportunity cost to a consumer who smokes cigarettes consists of the a costs imposed on others who inhale second-hand smoke. b products that the consumer could have bought instead of cigarettes. c amount of cigarette taxes paid by this consumer. d cost of complementary products such as lighters, ashtrays, and cigarette holders.

b products that the consumer could have bought instead of cigarettes.

Macroeconomics can best be described as the a analysis of how a consumer tries to spend income. b study of the large aggregates of the economy or the economy as a whole. c analysis of how firms attempt to maximize their profits. d study of how supply and demand determine prices in individual markets.

b study of the large aggregates of the economy or the economy as a whole.

Which of the following is a microeconomic statement? a The real domestic output increased by 1.6 percent last year. b Unemployment was 5.2 percent of the labor force last year. c The price of smartphones declined 2.8 percent last year. d The general price level increased by 1.1 percent last year.

c The price of smartphones declined 2.8 percent last year.

The Latin term "ceteris paribus" means a that if event A precedes event B, A has caused B. b that economics deals with facts, not values. c other things equal. d prosperity inevitably follows recession.

c other thing equal

What is a major opportunity cost of going to college on a full-time basis? a. the cost of transportation to college instead of to a job b. the cost of living expenses (room and board) to attend college c.the forgone income that would have been earned working in a full-time job d. the greater income that will be earned from having a college degree

the forgone income that would have been earned working in a full-time job