Question 1

Refer to the following figure for the following questions.  
-The opportunity cost of increasing production of apple pies from 14 to 16 pies is ________ pies.

Accepted Answer

A)  2 blueberry 
B)  14 apple 
C)  7 blueberry 
D)  4 blueberry 
E)  16 blueberry 
A)  2 blueberry 
B)  14 apple 
C)  7 blueberry 
D)  4 blueberry 
E)  16 blueberry

Question 2

Why do economists use models?

Accepted Answer

A)  Models are used to add complexity to a simple world. 
B)  Models allow us to study a simplified version of a complex world. 
C)  Models allow us to control exogenous factors. 
D)  Models make the world harder to understand. 
E)  Models allow us to examine more factors than what actually exists in our world. 
A)  Models are used to add complexity to a simple world. 
B)  Models allow us to study a simplified version of a complex world. 
C)  Models allow us to control exogenous factors. 
D)  Models make the world harder to understand. 
E)  Models allow us to examine more factors than what actually exists in our world.

Question 3

The figure depicts a shift in a society’s production possibilities frontier (PPF) for the manufacture of trains and planes: train-manufacturing capacity expands while plane-manufacturing capacity shrinks. Refer to this figure to answer the following questions.  
-Which point represents a new production possibility?

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 4

When the opportunity cost of producing a good rises as someone produces more of it,one experiences

Accepted Answer

A)  normative economics. 
B)  increasing relative costs. 
C)  downward-sloping demand. 
D)  inferior goods. 
E)  increasing marginal utility. 
A)  normative economics. 
B)  increasing relative costs. 
C)  downward-sloping demand. 
D)  inferior goods. 
E)  increasing marginal utility.

Question 5

An increase in the labor force would be reflected in a society's production possibilities frontier (PPF)by an

Accepted Answer

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

Question 6

Refer to the following figure for the following questions.  
-As we 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 7

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the following questions.  
-What is Gibbs's opportunity cost of making a wooden boat?

Accepted Answer

A)  20 solved crimes 
B)  30 solved crimes 
C)  10 solved crimes 
D)  1/20 of a boat 
E)  1/10 of a boat 
A)  20 solved crimes 
B)  30 solved crimes 
C)  10 solved crimes 
D)  1/20 of a boat 
E)  1/10 of a boat

Question 8

Refer to the following figure to answer the following questions.  
-Which of the following represents an inefficient point?

Accepted Answer

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

Question 9

What assumptions do economists make when developing a production possibilities frontier (PPF)?

Accepted Answer

To simplify the complexity of the real w

Question 10

Suppose that Lo and Manuel can either run errands or wash dishes.Their maximum outputs per hour are listed in the following table.Given the same quantity of resources,at what terms of trade (relative price ratio)could they specialize and trade so that both consume outside their own production possibilities frontiers (PPFs)?

Accepted Answer

A)  1 errand run per 75 dishes washed 
B)  1 errand run per 30 dishes washed 
C)  1 errand run per 12 dishes washed 
D)  1 errand run per 10 dishes washed 
E)  1 errand run per 6 dishes washed 
A)  1 errand run per 75 dishes washed 
B)  1 errand run per 30 dishes washed 
C)  1 errand run per 12 dishes washed 
D)  1 errand run per 10 dishes washed 
E)  1 errand run per 6 dishes washed

Question 11

If Lola can produce more output from a set amount of resources than Kevin,________ has a(n)________ advantage.

Accepted Answer

A)  Lola; comparative 
B)  Kevin; comparative 
C)  Lola; absolute 
D)  Kevin; absolute 
E)  Lola; normative 
A)  Lola; comparative 
B)  Kevin; comparative 
C)  Lola; absolute 
D)  Kevin; absolute 
E)  Lola; normative

Question 12

The ability of one producer to create more of a good than another producer using the same quantity of resources is called

Accepted Answer

A)  comparative advantage. 
B)  absolute advantage. 
C)  a positive-sum game. 
D)  gains from trade. 
E)  the law of increasing relative cost. 
A)  comparative advantage. 
B)  absolute advantage. 
C)  a positive-sum game. 
D)  gains from trade. 
E)  the law of increasing relative cost.

Question 13

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

Accepted Answer

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

Question 14

Which of the following is an important characteristic of good economic models?

Accepted Answer

A)  They deal with the economy as a whole. 
B)  They use the language of mathematics. 
C)  They are flexible in their designs. 
D)  They avoid making predictions. 
E)  They are as complex as the realities they represent. 
A)  They deal with the economy as a whole. 
B)  They use the language of mathematics. 
C)  They are flexible in their designs. 
D)  They avoid making predictions. 
E)  They are as complex as the realities they represent.

Question 15

Refer to the accompanying figure to answer the following questions.  
-Given the current resources,one would need even more hours in each day in order to attain

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 16

Opportunity cost is evident on the production possibilities frontier (PPF)graph

Accepted Answer

A)  as we move from one point on the frontier to another point on the frontier. 
B)  as we move from the origin to any inefficient point. 
C)  as we move from one unattainable point to an efficient point on the frontier. 
D)  as we move from an inefficient point to the origin. 
E)  at any one single point on the graph. 
A)  as we move from one point on the frontier to another point on the frontier. 
B)  as we move from the origin to any inefficient point. 
C)  as we move from one unattainable point to an efficient point on the frontier. 
D)  as we move from an inefficient point to the origin. 
E)  at any one single point on the graph.

Question 17

Suppose someone is studying a production possibilities frontier (PPF)that has a bowed-out shape relative to the origin.What causes this shape?

Accepted Answer

A)  economic growth 
B)  the law of increasing relative cost 
C)  absolute advantage 
D)  normative economics 
E)  more resources 
A)  economic growth 
B)  the law of increasing relative cost 
C)  absolute advantage 
D)  normative economics 
E)  more resources

Question 18

Economists use the scientific method and the tools of economics to study

Accepted Answer

A)  only the decisions of individuals. 
B)  only the decisions of business firms. 
C)  only economic growth and gross domestic product (GDP). 
D)  only the production possibilities curve. 
E)  anything around them; the world is the economist's laboratory. 
A)  only the decisions of individuals. 
B)  only the decisions of business firms. 
C)  only economic growth and gross domestic product (GDP). 
D)  only the production possibilities curve. 
E)  anything around them; the world is the economist's laboratory.

Question 19

Nadine is considering the "dress well,test well" theory,which argues that one performs better on exams when one dresses nicer than one does when wearing sweatpants.If Nadine wants to test this theory over the course of the semester,which of the following would be an endogenous factor in her experiment?

Accepted Answer

A)  her innate ability in the subject 
B)  the difficulty of the exam 
C)  the relative mix of multiple-choice and short-answer questions 
D)  her clothing choice for the exam 
E)  the amount of time Nadine spends studying for the exam 
A)  her innate ability in the subject 
B)  the difficulty of the exam 
C)  the relative mix of multiple-choice and short-answer questions 
D)  her clothing choice for the exam 
E)  the amount of time Nadine spends studying for the exam

Question 20

To determine which of two producers has a comparative advantage,one would need to know their

Accepted Answer

A)  increasing relative costs. 
B)  opportunity costs of production for both goods. 
C)  normative beliefs. 
D)  zero-sum games. 
E)  levels of investment. 
A)  increasing relative costs. 
B)  opportunity costs of production for both goods. 
C)  normative beliefs. 
D)  zero-sum games. 
E)  levels of investment.

Exam 2: Model Building and Gains From Trade

Refer to the following figure for the following questions. -The opportunity cost of increasing production of apple pies from 14 to 16 pies is ________ pies.

Why do economists use models?

When the opportunity cost of producing a good rises as someone produces more of it,one experiences

An increase in the labor force would be reflected in a society's production possibilities frontier (PPF)by an

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

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the following questions. -What is Gibbs's opportunity cost of making a wooden boat?

Refer to the following figure to answer the following questions. -Which of the following represents an inefficient point?

What assumptions do economists make when developing a production possibilities frontier (PPF)?

If Lola can produce more output from a set amount of resources than Kevin,________ has a(n)________ advantage.

The ability of one producer to create more of a good than another producer using the same quantity of resources is called

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

Which of the following is an important characteristic of good economic models?

Refer to the accompanying figure to answer the following questions. -Given the current resources,one would need even more hours in each day in order to attain

Opportunity cost is evident on the production possibilities frontier (PPF)graph

Suppose someone is studying a production possibilities frontier (PPF)that has a bowed-out shape relative to the origin.What causes this shape?

Economists use the scientific method and the tools of economics to study

To determine which of two producers has a comparative advantage,one would need to know their

Five Foundations of Economics

The Market at Work: Supply and Demand

Elasticity

Market Outcomes and Tax Incidence

Price Controls

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

Introduction to Macroeconomics and Gross Domestic Product

Unemployment

The Price Level and Inflation

Savings,interest Rates,and the Market for Loanable Funds

Financial Markets and Securities

Economic Growth and the Wealth of Nations

Growth Theory

The Aggregate Demandaggregate Supply Model

The Great Recession, the Great Depression, and Great Macroeconomic Debates

Federal Budgets: the Tools of Fiscal Policy

Fiscal Policy

Money and the Federal Reserve

Monetary Policy

International Trade

International Finance

Filters

If Lola can produce more output from a set amount of resources than Kevin, has a(n) advantage.