Question 1

Related to the Economics in Practice on page 26: How did the introduction of the microwave oven in 1960 affect the market for frozen food?

Accepted Answer

A)  It encouraged people to leave the work force by making cooking easier and less time-consuming. 
B)  It reduced the opportunity cost of eating frozen food by decreasing the amount of time required to prepare frozen meals. 
C)  It increased the financial cost of alternative methods of food preparation, such as conventional ovens. 
D)  It made frozen foods more appealing by increasing the variety of meals that could be frozen and reheated. 
A)  It encouraged people to leave the work force by making cooking easier and less time-consuming. 
B)  It reduced the opportunity cost of eating frozen food by decreasing the amount of time required to prepare frozen meals. 
C)  It increased the financial cost of alternative methods of food preparation, such as conventional ovens. 
D)  It made frozen foods more appealing by increasing the variety of meals that could be frozen and reheated.

Question 2

The concept of opportunity cost is based on the principle of

Accepted Answer

A)  need. 
B)  consumption. 
C)  scarcity. 
D)  profit. 
A)  need. 
B)  consumption. 
C)  scarcity. 
D)  profit.

Question 3

In economics, investment always refers to

Accepted Answer

A)  the act of buying stocks or bonds. 
B)  the creation of capital. 
C)  increasing the quantity of labor. 
D)  an increase in per capita output. 
A)  the act of buying stocks or bonds. 
B)  the creation of capital. 
C)  increasing the quantity of labor. 
D)  an increase in per capita output.

Question 4

Economists refer to things that have already been produced that are in turn used to produce other goods and services as

Accepted Answer

A)  land. 
B)  labor. 
C)  entrepreneurship. 
D)  capital. 
A)  land. 
B)  labor. 
C)  entrepreneurship. 
D)  capital.

Question 5

Refer to the information provided in Figure 2.1 below for the economy of Macroland to answer the question(s) that follow.   Figure 2.1
-Refer to Figure 2.1. Macroland is currently operating at Point A. The best explanation for this is that

Accepted Answer

A)  the economy has very poor technology. 
B)  the economy's resources are being used inefficiently. 
C)  the economy has very few resources. 
D)  the economy operates as an efficient market. 
A)  the economy has very poor technology. 
B)  the economy's resources are being used inefficiently. 
C)  the economy has very few resources. 
D)  the economy operates as an efficient market.

Question 6

The production possibility frontier is a graph that shows

Accepted Answer

A)  all the combinations of goods and services that are consumed over time if all of society's resources are used efficiently. 
B)  the amount of goods and services consumed at various average price levels. 
C)  the rate at which an economy's output will grow over time if all resources are used efficiently. 
D)  all the combinations of goods and services that can be produced if all of society's resources are used efficiently. 
A)  all the combinations of goods and services that are consumed over time if all of society's resources are used efficiently. 
B)  the amount of goods and services consumed at various average price levels. 
C)  the rate at which an economy's output will grow over time if all resources are used efficiently. 
D)  all the combinations of goods and services that can be produced if all of society's resources are used efficiently.

Question 7

In a free-market system, the amount of output that any one household gets depends on its

Accepted Answer

A)  income. 
B)  wealth. 
C)  wage and interest income. 
D)  income and wealth. 
A)  income. 
B)  wealth. 
C)  wage and interest income. 
D)  income and wealth.

Question 8

Refer to the information provided in Table 2.1 below to answer the following question(s).
Table 2.1
 $$\begin{array} { | c | c | c | } 
\hline & \text { Krystal } & \text { Mark } \
\hline \text { Writing Poerss } & 8 & 12 \
\hline \text { Writing TV Cornnercials } & 2 & 4 \
\hline
\end{array}$$
-Refer to Table 2.1. For Krystal, the opportunity cost of writing one TV commercial is

Accepted Answer

A)  1/4 of a poem. 
B)  2 poems. 
C)  4 poems. 
D)  6 poems. 
A)  1/4 of a poem. 
B)  2 poems. 
C)  4 poems. 
D)  6 poems.

Question 9

If the unemployment rate increases from 10% to 14%, the economy will

Accepted Answer

A)  move closer to a point on the ppf. 
B)  move away from the ppf toward the origin. 
C)  remain on the ppf. 
D)  remain on the origin. 
A)  move closer to a point on the ppf. 
B)  move away from the ppf toward the origin. 
C)  remain on the ppf. 
D)  remain on the origin.

Question 10

Periods of less than full employment correspond to

Accepted Answer

A)  points outside the ppf. 
B)  points underneath the ppf. 
C)  points on the ppf. 
D)  either points inside or outside the ppf. 
A)  points outside the ppf. 
B)  points underneath the ppf. 
C)  points on the ppf. 
D)  either points inside or outside the ppf.

Question 11

The amount that households have accumulated out of past income through saving and inheritance is

Accepted Answer

A)  future income. 
B)  wealth. 
C)  consumption. 
D)  present income. 
A)  future income. 
B)  wealth. 
C)  consumption. 
D)  present income.

Question 12

Refer to the information provided in Figure 2.6 below to answer the question(s) that follow.   Figure 2.6
-Refer to Figure 2.6. Economic growth is represented by a

Accepted Answer

A)  shift from ppf2 to ppf1. 
B)  shift from ppf1 to ppf2. 
C)  movement along ppf1. 
D)  movement along ppf2. 
A)  shift from ppf2 to ppf1. 
B)  shift from ppf1 to ppf2. 
C)  movement along ppf1. 
D)  movement along ppf2.

Question 13

Which of the following is true of a market economy?

Accepted Answer

A)  In its pure form, it is also known as a command economy. 
B)  Decisions are regulated by a central agency. 
C)  The government answers the basic economic questions of what gets produced, how it gets produced, and who gets it. 
D)  It relies on millions of individual economic decisions to determine economic outcomes. 
A)  In its pure form, it is also known as a command economy. 
B)  Decisions are regulated by a central agency. 
C)  The government answers the basic economic questions of what gets produced, how it gets produced, and who gets it. 
D)  It relies on millions of individual economic decisions to determine economic outcomes.

Question 14

Refer to the information provided in Figure 2.3 below to answer the question(s) that follow.   Figure 2.3
-Refer to Figure 2.3. Assume that in this society the marginal rate of transformation of sailboats for surfboards is constant and equal to -10. A graph of this society's production possibility frontier will be represented by Panel

Accepted Answer

A)  A. 
B)  B. 
C)  C. 
D)  D. 
A)  A. 
B)  B. 
C)  C. 
D)  D.

Question 15

Points outside a production possibility frontier represent inefficiency.

Accepted Answer

A) True 
 B)False

Question 16

If the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be

Accepted Answer

A)  negatively sloped and "bowed inward" toward the origin. 
B)  negatively sloped and "bowed outward" from the origin. 
C)  a negatively sloped straight line. 
D)  a positively sloped straight line. 
A)  negatively sloped and "bowed inward" toward the origin. 
B)  negatively sloped and "bowed outward" from the origin. 
C)  a negatively sloped straight line. 
D)  a positively sloped straight line.

Question 17

A society's production possibility frontier is bowed in from the origin due to specialized resources.

Accepted Answer

A) True 
 B)False

Question 18

Resources are also referred to as outputs.

Accepted Answer

A) True 
 B)False

Related to the Economics in Practice on page 26: How did the introduction of the microwave oven in 1960 affect the market for frozen food?

The concept of opportunity cost is based on the principle of

In economics, investment always refers to

Economists refer to things that have already been produced that are in turn used to produce other goods and services as

Refer to the information provided in Figure 2.1 below for the economy of Macroland to answer the question(s) that follow. Figure 2.1 -Refer to Figure 2.1. Macroland is currently operating at Point A. The best explanation for this is that

The production possibility frontier is a graph that shows

In a free-market system, the amount of output that any one household gets depends on its

Refer to the information provided in Table 2.1 below to answer the following question(s). Table 2.1 Krystal Mark Writing Poerss 8 12 Writing TV Cornnercials 2 4 -Refer to Table 2.1. For Krystal, the opportunity cost of writing one TV commercial is

If the unemployment rate increases from 10% to 14%, the economy will

Periods of less than full employment correspond to

The amount that households have accumulated out of past income through saving and inheritance is

Refer to the information provided in Figure 2.6 below to answer the question(s) that follow. Figure 2.6 -Refer to Figure 2.6. Economic growth is represented by a

Which of the following is true of a market economy?

Points outside a production possibility frontier represent inefficiency.

If the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be

A society's production possibility frontier is bowed in from the origin due to specialized resources.

Resources are also referred to as outputs.

The Scope and Method of Economics

Demand, Supply, and Market Equilibrium

Demand and Supply Applications

Elasticity

Household Behavior and Consumer Choice

The Production Process: the Behavior of Profit-Maximizing Firms

Short-Run Costs and Output Decisions

Long-Run Costs and Output Decisions

Input Demand: the Labor and Land Markets

Input Demand: the Capital Market and the Investment Decision

General Equilibrium and the Efficiency of Perfect Competition

Monopoly and Antitrust Policy

Oligopoly

Monopolistic Competition

Externalities, Public Goods, and Common Resources

Uncertainty and Asymmetric Information

Income Distribution and Poverty

Public Finance: the Economics of Taxation

International Trade, Comparative Advantage, and Protectionism

Economic Growth in Developing Economies

Critical Thinking About Research

Filters

Exam 2: The Economic Problem: Scarcity and Choice

Related to the Economics in Practice on page 26: How did the introduction of the microwave oven in 1960 affect the market for frozen food?

The concept of opportunity cost is based on the principle of

In economics, investment always refers to

Economists refer to things that have already been produced that are in turn used to produce other goods and services as

Refer to the information provided in Figure 2.1 below for the economy of Macroland to answer the question(s) that follow. Figure 2.1 -Refer to Figure 2.1. Macroland is currently operating at Point A. The best explanation for this is that

The production possibility frontier is a graph that shows

In a free-market system, the amount of output that any one household gets depends on its

Refer to the information provided in Table 2.1 below to answer the following question(s). Table 2.1 Krystal Mark Writing Poerss 8 12 Writing TV Cornnercials 2 4 -Refer to Table 2.1. For Krystal, the opportunity cost of writing one TV commercial is

If the unemployment rate increases from 10% to 14%, the economy will

Periods of less than full employment correspond to

The amount that households have accumulated out of past income through saving and inheritance is

Refer to the information provided in Figure 2.6 below to answer the question(s) that follow. Figure 2.6 -Refer to Figure 2.6. Economic growth is represented by a

Which of the following is true of a market economy?

Points outside a production possibility frontier represent inefficiency.

If the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be

A society's production possibility frontier is bowed in from the origin due to specialized resources.

Resources are also referred to as outputs.

The Scope and Method of Economics

Demand, Supply, and Market Equilibrium

Demand and Supply Applications

Elasticity

Household Behavior and Consumer Choice

The Production Process: the Behavior of Profit-Maximizing Firms

Short-Run Costs and Output Decisions

Long-Run Costs and Output Decisions

Input Demand: the Labor and Land Markets

Input Demand: the Capital Market and the Investment Decision

General Equilibrium and the Efficiency of Perfect Competition

Monopoly and Antitrust Policy

Oligopoly

Monopolistic Competition

Externalities, Public Goods, and Common Resources

Uncertainty and Asymmetric Information

Income Distribution and Poverty

Public Finance: the Economics of Taxation

International Trade, Comparative Advantage, and Protectionism

Economic Growth in Developing Economies

Critical Thinking About Research

Filters