Question 1

Refer to the following figure for the questions that follow.
  
-As you move from points N to M to L,the opportunity cost of additional apple pie:

Accepted Answer

A) decreases due to the law of increasing relative cost. 
B) increases due to the law of increasing relative cost. 
C) decreases due to the law of normative economics. 
D) increases due to the law of marginal analysis. 
E) decreases due to enhancements in technology. 
A) decreases due to the law of increasing relative cost. 
B) increases due to the law of increasing relative cost. 
C) decreases due to the law of normative economics. 
D) increases due to the law of marginal analysis. 
E) decreases due to enhancements in technology.

Question 2

Refer to the following figure to answer the questions that follow.
  
-Which point in the corresponding figure represents a combination of smoothies and milk shakes that society cannot currently produce?

Accepted Answer

A) point A 
B) point B 
C) point C 
D) point D 
E) point E 
A) point A 
B) point B 
C) point C 
D) point D 
E) point E

Question 3

An increase in general resources that affects the production of both goods on a production possibilities frontier (PPF)would cause an:

Accepted Answer

A) inward shift of the PPF. 
B) outward shift of the PPF. 
C) outward rotation along the x axis. 
D) outward rotation along the y axis. 
E) increase in opportunity cost. 
A) inward shift of the PPF. 
B) outward shift of the PPF. 
C) outward rotation along the x axis. 
D) outward rotation along the y axis. 
E) increase in opportunity cost.

Question 4

For both parties to benefit from specialization and trade,the trading parties must agree on:

Accepted Answer

A) a price somewhere between their opportunity costs of production. 
B) a plan not to trade with other parties. 
C) who has the absolute advantage in production. 
D) the appropriate level of investment for the future. 
E) the source of comparative advantage. 
A) a price somewhere between their opportunity costs of production. 
B) a plan not to trade with other parties. 
C) who has the absolute advantage in production. 
D) the appropriate level of investment for the future. 
E) the source of comparative advantage.

Question 5

Comment on the role of models in economics.What are the strengths and weaknesses of using them to explore the world around us?

Accepted Answer

Models are important because they simpli

Question 6

Michael and Angelo are both artists who can create sculptures or paintings each day.The following table describes their maximum outputs per day.Does either one have a comparative advantage?

Accepted Answer

A) Yes,Michael has a comparative advantage in both sculptures and paintings. 
B) Yes,Angelo has a comparative advantage in both sculptures and paintings. 
C) Yes,Michael has a comparative advantage in paintings,and Angelo has a comparative advantage in sculptures. 
D) Yes,Michael has a comparative advantage in sculptures,and Angelo has a comparative advantage in paintings. 
E) No,neither has a comparative advantage. 
A) Yes,Michael has a comparative advantage in both sculptures and paintings. 
B) Yes,Angelo has a comparative advantage in both sculptures and paintings. 
C) Yes,Michael has a comparative advantage in paintings,and Angelo has a comparative advantage in sculptures. 
D) Yes,Michael has a comparative advantage in sculptures,and Angelo has a comparative advantage in paintings. 
E) No,neither has a comparative advantage.

Question 7

At full employment,a society produces:

Accepted Answer

A) somewhere within its production possibilities frontier (PPF). 
B) somewhere outside its PPF. 
C) at the origin on its PPF graph. 
D) on its PPF. 
E) only one good. 
A) somewhere within its production possibilities frontier (PPF). 
B) somewhere outside its PPF. 
C) at the origin on its PPF graph. 
D) on its PPF. 
E) only one good.

Question 8

Ceteris paribus means:

Accepted Answer

A) in sets of two. 
B) constant opportunity cost. 
C) other things being equal. 
D) buyer beware. 
E) there is no reason to argue about people's tastes. 
A) in sets of two. 
B) constant opportunity cost. 
C) other things being equal. 
D) buyer beware. 
E) there is no reason to argue about people's tastes.

Question 9

Draw a production possibilities frontier (PPF)that shows a pizza shop's production trade-offs between producing pizzas and stromboli.Suppose the pizza shop upgrades to a larger,more-automated oven.On the same graph,show how the PPF changes.(The oven is used to bake both pizzas and stromboli.)

Accepted Answer

The answer of Draw a production possibilities frontier (PPF)that shows...

Question 10

Consider the following scenario to answer the questions that follow: Two friends,Rachel and Joey,enjoy baking bread and making apple pies.Rachel takes two hours to bake 1 loaf of bread and one hour to make 1 pie.Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie.
-What is Joey's opportunity cost of baking 1 loaf of bread?

Accepted Answer

A) 4 pies 
B) 2 pies 
C) 1 pie 
D) 1 loaf of bread 
E) 1/2 loaf of bread 
A) 4 pies 
B) 2 pies 
C) 1 pie 
D) 1 loaf of bread 
E) 1/2 loaf of bread

Question 11

Refer to the following table to answer the questions that follow.
  
-Given an eight-hour workday,and to experience gains from trade,

Accepted Answer

A) Alicia should make pizzas and Jay-Z should make cheesesteaks. 
B) Alicia should make cheesesteaks and Jay-Z should make pizzas. 
C) each should make their own cheesesteaks and pizzas. 
D) Alicia should produce both pizzas and cheesesteaks. 
E) Jay-Z should produce both pizzas and cheesesteaks. 
A) Alicia should make pizzas and Jay-Z should make cheesesteaks. 
B) Alicia should make cheesesteaks and Jay-Z should make pizzas. 
C) each should make their own cheesesteaks and pizzas. 
D) Alicia should produce both pizzas and cheesesteaks. 
E) Jay-Z should produce both pizzas and cheesesteaks.

Question 12

An economist's use of experiments and real-world data to test a theory is an example of:

Accepted Answer

A) the scientific method in economics. 
B) macroeconomics. 
C) economic growth. 
D) normative analysis. 
E) comparative advantage. 
A) the scientific method in economics. 
B) macroeconomics. 
C) economic growth. 
D) normative analysis. 
E) comparative advantage.

Question 13

Suppose that Alicia Keys and Jay-Z could each make either New York-style pizza or Philly cheesesteaks.Given an eight-hour workday,which of the following would permit them to consume outside their respective production possibilities frontiers (PPFs)?

Accepted Answer

A) a decrease in technology 
B) a decrease in resources 
C) specialization and trade 
D) efficient use of all their productive resources 
E) an "Empire State" of mind 
A) a decrease in technology 
B) a decrease in resources 
C) specialization and trade 
D) efficient use of all their productive resources 
E) an "Empire State" of mind

Question 14

Goods that are produced today in order to make other valuable goods and services in the future are called:

Accepted Answer

A) normal goods. 
B) inferior goods. 
C) consumer goods. 
D) capital goods. 
E) personal goods. 
A) normal goods. 
B) inferior goods. 
C) consumer goods. 
D) capital goods. 
E) personal goods.

Question 15

A town on the Gulf Coast is battered by a massive hurricane that destroys most of its productive resources.The community's production possibilities frontier (PPF)would show an:

Accepted Answer

A) inward shift of the PPF. 
B) outward shift of the PPF. 
C) outward rotation along the x axis. 
D) outward rotation along the y axis. 
E) increase in opportunity cost. 
A) inward shift of the PPF. 
B) outward shift of the PPF. 
C) outward rotation along the x axis. 
D) outward rotation along the y axis. 
E) increase in opportunity cost.

Question 16

Refer to the following figure to answer the questions that follow.
  
-Which of the following represents a point that is unattainable with current resources and technology?

Accepted Answer

A) point A 
B) point B 
C) point C 
D) point D 
E) point E 
A) point A 
B) point B 
C) point C 
D) point D 
E) point E

Question 17

Why doesn't our society invest more resources into the production of capital goods to enhance the level of growth in our future production possibilities frontier (PPF)?

Accepted Answer

Capital goods are great because they lea

Question 18

When one producer can create more of a good than another producer using the same quantity of resources,the first producer has:

Accepted Answer

A) a zero-sum game. 
B) gains from trade. 
C) an absolute advantage. 
D) a comparative advantage. 
E) increasing relative costs. 
A) a zero-sum game. 
B) gains from trade. 
C) an absolute advantage. 
D) a comparative advantage. 
E) increasing relative costs.

Question 19

Which of the following is a positive statement?

Accepted Answer

A) My dog should lose some weight. 
B) Legally requiring dogs to have rabies shots will reduce the number of rabid dogs. 
C) You should take your dog to the veterinarian once a year for a checkup. 
D) Chihuahuas are cuter than bulldogs. 
E) All dogs should be required to wear leashes at all times. 
A) My dog should lose some weight. 
B) Legally requiring dogs to have rabies shots will reduce the number of rabid dogs. 
C) You should take your dog to the veterinarian once a year for a checkup. 
D) Chihuahuas are cuter than bulldogs. 
E) All dogs should be required to wear leashes at all times.

Question 20

Consider the following scenario to answer the questions that follow: Two friends,Rachel and Joey,enjoy baking bread and making apple pies.Rachel takes two hours to bake 1 loaf of bread and one hour to make 1 pie.Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie.
-What is Rachel's opportunity cost of baking 1 loaf of bread?

Accepted Answer

A) 4 pies 
B) 2 pies 
C) 1 pie 
D) 1 loaf of bread 
E) 1/2 loaf of bread 
A) 4 pies 
B) 2 pies 
C) 1 pie 
D) 1 loaf of bread 
E) 1/2 loaf of bread

Refer to the following figure for the questions that follow. -As you move from points N to M to L,the opportunity cost of additional apple pie:

Refer to the following figure to answer the questions that follow. -Which point in the corresponding figure represents a combination of smoothies and milk shakes that society cannot currently produce?

An increase in general resources that affects the production of both goods on a production possibilities frontier (PPF)would cause an:

For both parties to benefit from specialization and trade,the trading parties must agree on:

Comment on the role of models in economics.What are the strengths and weaknesses of using them to explore the world around us?

Michael and Angelo are both artists who can create sculptures or paintings each day.The following table describes their maximum outputs per day.Does either one have a comparative advantage?

At full employment,a society produces:

Ceteris paribus means:

Draw a production possibilities frontier (PPF)that shows a pizza shop's production trade-offs between producing pizzas and stromboli.Suppose the pizza shop upgrades to a larger,more-automated oven.On the same graph,show how the PPF changes.(The oven is used to bake both pizzas and stromboli.)

Refer to the following table to answer the questions that follow. -Given an eight-hour workday,and to experience gains from trade,

An economist's use of experiments and real-world data to test a theory is an example of:

Suppose that Alicia Keys and Jay-Z could each make either New York-style pizza or Philly cheesesteaks.Given an eight-hour workday,which of the following would permit them to consume outside their respective production possibilities frontiers (PPFs)?

Goods that are produced today in order to make other valuable goods and services in the future are called:

A town on the Gulf Coast is battered by a massive hurricane that destroys most of its productive resources.The community's production possibilities frontier (PPF)would show an:

Refer to the following figure to answer the questions that follow. -Which of the following represents a point that is unattainable with current resources and technology?

Why doesn't our society invest more resources into the production of capital goods to enhance the level of growth in our future production possibilities frontier (PPF)?

When one producer can create more of a good than another producer using the same quantity of resources,the first producer has:

Which of the following is a positive statement?

The Five Foundations of Economics

The Market at Work: Supply and Demand

Elasticity

Price Controls

The Efficiency of Markets and the Costs of Taxation

Market Inefficiencies: Externalities and Public Goods

Business Costs and Production

Firms in a Competitive Market

Understanding Monopoly

Price Discrimination

Monopolistic Competition and Advertising

Oligopoly and Strategic Behavior

The Demand and Supply of Resources

Income,inequality,and Poverty

Consumer Choice

Behavioral Economics and Risk Taking

Health Insurance and Health Care

Filters

Exam 2: Model Building and Gains From Trade

Refer to the following figure for the questions that follow. -As you move from points N to M to L,the opportunity cost of additional apple pie:

Refer to the following figure to answer the questions that follow. -Which point in the corresponding figure represents a combination of smoothies and milk shakes that society cannot currently produce?

An increase in general resources that affects the production of both goods on a production possibilities frontier (PPF)would cause an:

For both parties to benefit from specialization and trade,the trading parties must agree on:

Comment on the role of models in economics.What are the strengths and weaknesses of using them to explore the world around us?

Michael and Angelo are both artists who can create sculptures or paintings each day.The following table describes their maximum outputs per day.Does either one have a comparative advantage?

At full employment,a society produces:

Ceteris paribus means:

Draw a production possibilities frontier (PPF)that shows a pizza shop's production trade-offs between producing pizzas and stromboli.Suppose the pizza shop upgrades to a larger,more-automated oven.On the same graph,show how the PPF changes.(The oven is used to bake both pizzas and stromboli.)

Refer to the following table to answer the questions that follow. -Given an eight-hour workday,and to experience gains from trade,

An economist's use of experiments and real-world data to test a theory is an example of:

Suppose that Alicia Keys and Jay-Z could each make either New York-style pizza or Philly cheesesteaks.Given an eight-hour workday,which of the following would permit them to consume outside their respective production possibilities frontiers (PPFs)?

Goods that are produced today in order to make other valuable goods and services in the future are called:

A town on the Gulf Coast is battered by a massive hurricane that destroys most of its productive resources.The community's production possibilities frontier (PPF)would show an:

Refer to the following figure to answer the questions that follow. -Which of the following represents a point that is unattainable with current resources and technology?

Why doesn't our society invest more resources into the production of capital goods to enhance the level of growth in our future production possibilities frontier (PPF)?

When one producer can create more of a good than another producer using the same quantity of resources,the first producer has:

Which of the following is a positive statement?

The Five Foundations of Economics

The Market at Work: Supply and Demand

Elasticity

Price Controls

The Efficiency of Markets and the Costs of Taxation

Market Inefficiencies: Externalities and Public Goods

Business Costs and Production

Firms in a Competitive Market

Understanding Monopoly

Price Discrimination

Monopolistic Competition and Advertising

Oligopoly and Strategic Behavior

The Demand and Supply of Resources

Income,inequality,and Poverty

Consumer Choice

Behavioral Economics and Risk Taking

Health Insurance and Health Care

Filters