Question 1

The concept of opportunity cost only applies to societies that operate in a market-based economy.

Accepted Answer

A) True 
 B)False

Question 2

A production possibilities frontier shows the combinations of various goods that should be produced.

Accepted Answer

A) True 
 B)False

Question 3

Karl Marx was critical of markets on the grounds that they are not efficient.

Accepted Answer

A) True 
 B)False

Question 4

Few bother to think about what makes Florida oranges show up daily in South Dakota supermarkets, but the people of South Dakota are likely to think a great deal about this. Why does someone take the time and energy to assure that oranges that are grown in Florida move more than 1,000 miles before they appear on grocery shelves?

Accepted Answer

In a market economy, there is profit to

Question 5

The production possibilities frontier in Figure 3-1, using a move from point B to point D as an example, shows

Accepted Answer

A)  a constant slope. 
B)  the principle of comparative advantage. 
C)  the principle of increasing costs. 
D)  an inefficient allocation of resources. 
A)  a constant slope. 
B)  the principle of comparative advantage. 
C)  the principle of increasing costs. 
D)  an inefficient allocation of resources.

Question 6

In early 1996, the upper Midwest suffered record cold, with wind chills of 50° below zero or worse. Yet, grocery stores stocked fresh citrus fruit (which was clearly not grown locally). Why did grocers stock the fruit?

Accepted Answer

A)  The desire for profit 
B)  Concern for their neighbors 
C)  The need to dispose of excess production 
D)  Government orders to distribute fruit 
E)  All of the responses are correct. 
A)  The desire for profit 
B)  Concern for their neighbors 
C)  The need to dispose of excess production 
D)  Government orders to distribute fruit 
E)  All of the responses are correct.

Question 7

Adam Smith's discussion of the production in a pin factory illustrates the law of comparative advantage.

Accepted Answer

A) True 
 B)False

Question 8

The term "satisficing" indicates an optimal choice.

Accepted Answer

A) True 
 B)False

Question 9

Do markets solve all of society's problems?

Accepted Answer

A)  Yes, markets are efficient and work well under nearly all circumstances. 
B)  Yes, markets solve the problems of production and distribution. 
C)  No, they do not solve problems such as unemployment and inflation. 
D)  No, they hardly solve any problems at all. 
E)  Uncertain, economic theory has no answer to this question. 
A)  Yes, markets are efficient and work well under nearly all circumstances. 
B)  Yes, markets solve the problems of production and distribution. 
C)  No, they do not solve problems such as unemployment and inflation. 
D)  No, they hardly solve any problems at all. 
E)  Uncertain, economic theory has no answer to this question.

Question 10

The opportunity cost of a college education includes wages lost while enrolled in school.

Accepted Answer

A) True 
 B)False

The concept of opportunity cost only applies to societies that operate in a market-based economy.

A production possibilities frontier shows the combinations of various goods that should be produced.

Karl Marx was critical of markets on the grounds that they are not efficient.

The production possibilities frontier in Figure 3-1, using a move from point B to point D as an example, shows

In early 1996, the upper Midwest suffered record cold, with wind chills of 50° below zero or worse. Yet, grocery stores stocked fresh citrus fruit (which was clearly not grown locally). Why did grocers stock the fruit?

Adam Smith's discussion of the production in a pin factory illustrates the law of comparative advantage.

The term "satisficing" indicates an optimal choice.

Do markets solve all of society's problems?

The opportunity cost of a college education includes wages lost while enrolled in school.

What Is Economics

The Economy: Myth and Reality

Supply and Demand: an Initial Look

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation

Bringing in the Supply Side: Unemployment and Inflation

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder

Exchange Rates and the Macroeconomy

Contemporary Issues in the Us Economy

Filters

Exam 3: The Fundamental Economic Problem: Scarcity and Choice

The concept of opportunity cost only applies to societies that operate in a market-based economy.

A production possibilities frontier shows the combinations of various goods that should be produced.

Karl Marx was critical of markets on the grounds that they are not efficient.

The production possibilities frontier in Figure 3-1, using a move from point B to point D as an example, shows

In early 1996, the upper Midwest suffered record cold, with wind chills of 50° below zero or worse. Yet, grocery stores stocked fresh citrus fruit (which was clearly not grown locally). Why did grocers stock the fruit?

Adam Smith's discussion of the production in a pin factory illustrates the law of comparative advantage.

The term "satisficing" indicates an optimal choice.

Do markets solve all of society's problems?

The opportunity cost of a college education includes wages lost while enrolled in school.

What Is Economics

The Economy: Myth and Reality

Supply and Demand: an Initial Look

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation

Bringing in the Supply Side: Unemployment and Inflation

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder

Exchange Rates and the Macroeconomy

Contemporary Issues in the Us Economy

Filters