Exam 1: First Principles

When people in Brazil engage in trade with people in Germany, all citizens in both nations are necessarily made better off.

Because the United States is a rich nation, free health care can be provided for all citizens without considering the issue of scarcity.

When people want more goods and services than are available, the economy undergoes inflation. Which economic principle does this statement BEST represent?

The government of a small town has decided to ban smoking in all restaurants, stores, and government offices. This is an example of the principle that:

Which of the following policies is MOST likely to reduce traffic congestion in a large metropolitan area because people usually exploit opportunities to make themselves better off?

Specialization and trade should NOT lead to:

Buying vegetables at a farmers' market benefits the community because:

Sometimes the government varies its spending, depending on the needs of the country. Which economic principle does this statement BEST represent?

Which factor is NOT an example of a resource?

Which statement is CORRECT?

The university recently inherited a large mansion from a wealthy alumnus. The university plans to use the mansion for faculty parties and to house distinguished guests. The opportunity cost of the mansion to the university is:

Florida schools offered cash bonuses to students who scored high on the state's standardized exams. The cash bonuses are motivated by which economic principle?

After eating three slices of pizza, you decide to eat one more piece. Your decision is an example of the economic concept called:

Which statement is NOT a reason that markets usually lead to efficiency?

Zoe's grandparents are excited about finally paying off their mortgage because, as they say, "Our cost of housing is now zero." Zoe should explain to them the economic concept of:

A choice made _____ is a choice whether to do a little more or a little less of an activity.

Marla will make $10 by tutoring for an additional hour, but she will lose an hour of studying for her economics test. Marla decides to study, rather than tutor. Marla's choice indicates that she:

Which of the following questions would NOT involve marginal analysis:

Because people usually exploit opportunities to make themselves better off, which method of reducing pollution is likely to be MOST effective?

You notice that when a new yoga class is offered at the student recreation center at a highly desirable time, some students from the other yoga classes go to the new class instead. Which economic principle does this statement BEST represent?