Question 1

An increase in the unemployment rate would be shown on a production possibilities curve by

Accepted Answer

A) shifting the entire curve outward. 
B) shifting the entire curve inward. 
C) moving from a point on or near the curve to a point closer to the origin, rather than shifting the entire curve. 
D) moving from a point inside the curve to a point on or at least closer to, the curve, rather than shifting the entire curve. 
A) shifting the entire curve outward. 
B) shifting the entire curve inward. 
C) moving from a point on or near the curve to a point closer to the origin, rather than shifting the entire curve. 
D) moving from a point inside the curve to a point on or at least closer to, the curve, rather than shifting the entire curve.

Question 2

The wealth of nations is determined by the resources available to a nation and was discussed in 1776 by the famous economist, _________________.

Accepted Answer

The answer of The wealth of nations is determined by...

Question 3

An inward shift of the production possibilities curve

Accepted Answer

A) represents an economic decline. 
B) means that the previous levels of production are now unobtainable except under unusual circumstances such as war. 
C) means that the economy can produce more of both goods. 
D) All of the choices are true. 
E) represents an economic decline AND means that the previous levels of production are now unobtainable except under unusual circumstances such as war. 
A) represents an economic decline. 
B) means that the previous levels of production are now unobtainable except under unusual circumstances such as war. 
C) means that the economy can produce more of both goods. 
D) All of the choices are true. 
E) represents an economic decline AND means that the previous levels of production are now unobtainable except under unusual circumstances such as war.

Question 4

-In 1944 the U.S. economy was temporarily operating at point ________.

Accepted Answer

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

Question 5

The Law of Increasing Cost is based upon which of the following?

Accepted Answer

A) If units of a resource are added to a fixed proportion of other resources, eventually marginal output will decline. 
B) Economies of scale eventually outweigh diseconomies of scale. 
C) Resources become more suitable for use in the production process as the output of one good expands. 
D) All of the choices are true. 
A) If units of a resource are added to a fixed proportion of other resources, eventually marginal output will decline. 
B) Economies of scale eventually outweigh diseconomies of scale. 
C) Resources become more suitable for use in the production process as the output of one good expands. 
D) All of the choices are true.

Question 6

Economic growth is difficult for poor countries because

Accepted Answer

A) governments must fund capital production and research out of tax revenues. 
B) resources must be taken away from consumer goods to pay for technology. 
C) resources must be taken away from consumer goods to pay for capital goods. 
D) those wealthy enough to invest in domestic industries may choose to invest abroad instead. 
E) All of the choices are true. 
A) governments must fund capital production and research out of tax revenues. 
B) resources must be taken away from consumer goods to pay for technology. 
C) resources must be taken away from consumer goods to pay for capital goods. 
D) those wealthy enough to invest in domestic industries may choose to invest abroad instead. 
E) All of the choices are true.

Question 7

Which statement is true?

Accepted Answer

A) Entrepreneurial ability is in short supply in the U.S. 
B) Land, labor and capital may be considered passive resources. 
C) The concept of opportunity cost is irrelevant when there is scarcity. 
D) None of these statements are true. 
A) Entrepreneurial ability is in short supply in the U.S. 
B) Land, labor and capital may be considered passive resources. 
C) The concept of opportunity cost is irrelevant when there is scarcity. 
D) None of these statements are true.

Question 8

Hypothetical Production Schedule for a Two-Product Economy  
-If the economy produces 27 consumer goods and 12 capital goods, the economy would be producing __________________ (outside/on/inside) the production possibilities curve.

Accepted Answer

The answer of Hypothetical Production Schedule for a Two-Product Economy...

Question 9

Statement I. Employment discrimination causes underemployment. Statement II. The concept of opportunity cost has little validity in the global economy.

Accepted Answer

A) Statement I is true and statement II is false. 
B) Statement II is true and statement I is false. 
C) Both statements are true. 
D) Both statements are false. 
A) Statement I is true and statement II is false. 
B) Statement II is true and statement I is false. 
C) Both statements are true. 
D) Both statements are false.

Question 10

Opportunity cost can be best defined as

Accepted Answer

A) all sunk costs. 
B) the value of the best alternative given up when making a choice. 
C) the explicit cost of an activity. 
D) the cost of making one additional unit. 
E) the cost of finding profit-making opportunities. 
A) all sunk costs. 
B) the value of the best alternative given up when making a choice. 
C) the explicit cost of an activity. 
D) the cost of making one additional unit. 
E) the cost of finding profit-making opportunities.

Question 11

If you own a building and you decide to use that building to open a restaurant,

Accepted Answer

A) there are no sunk costs involved in this decision. 
B) there is no opportunity cost of using this building for a restaurant because you own it. 
C) the only cost relevant to this decision is the price you paid for the building. 
D) there is an opportunity cost of using this building for a restaurant because it could have been used in other ways. 
A) there are no sunk costs involved in this decision. 
B) there is no opportunity cost of using this building for a restaurant because you own it. 
C) the only cost relevant to this decision is the price you paid for the building. 
D) there is an opportunity cost of using this building for a restaurant because it could have been used in other ways.

Question 12

Which statement is the most accurate?

Accepted Answer

A) A nation's economic capacity expands when the size of the labor force expands. 
B) Our rate of economic growth slows down if we produced too many investment goods and not enough consumer goods. 
C) Our unemployment rate has never fallen below five percent. 
D) We could raise our economic growth rate if Americans would invest less and spend more. 
A) A nation's economic capacity expands when the size of the labor force expands. 
B) Our rate of economic growth slows down if we produced too many investment goods and not enough consumer goods. 
C) Our unemployment rate has never fallen below five percent. 
D) We could raise our economic growth rate if Americans would invest less and spend more.

Question 13

In order to raise our rate of economic growth our country needs to

Accepted Answer

A) Spend more on consumer goods. 
B) Use older, tried and true technology. 
C) Have its consumers save less. 
D) Have its business firms invest more. 
A) Spend more on consumer goods. 
B) Use older, tried and true technology. 
C) Have its consumers save less. 
D) Have its business firms invest more.

Question 14

Why did the U.S. temporarily operate outside the production possibilities frontier in 1942, 1943, and 1944?

Accepted Answer

A) The Civil War 
B) World War I 
C) The Great Depression 
D) World War II 
A) The Civil War 
B) World War I 
C) The Great Depression 
D) World War II

Question 15

-The economy usually operates at point _______.

Accepted Answer

The answer of  
-The economy usually operates at point...

Question 16

In the American economy, the central figure is the _______________.

Accepted Answer

The answer of In the American economy, the central figure...

Question 17

-If we moved from point T to point R we would be

Accepted Answer

A) giving up trips for more transplants. 
B) giving up transplants for more trips. 
C) gaining both trips and transplants. 
D) losing both trips and transplants. 
A) giving up trips for more transplants. 
B) giving up transplants for more trips. 
C) gaining both trips and transplants. 
D) losing both trips and transplants.

Question 18

An improvement in technology will cause the

Accepted Answer

A) economy to move down the production possibility frontier. 
B) production possibility frontier to shift inward. 
C) production possibility frontier to shift outward. 
D) economy to move closer to its production possibility frontier. 
A) economy to move down the production possibility frontier. 
B) production possibility frontier to shift inward. 
C) production possibility frontier to shift outward. 
D) economy to move closer to its production possibility frontier.

Question 19

A production possibilities curve shows

Accepted Answer

A) that in order to acquire more of one good, none of the alternative good must be given up. 
B) that in order to acquire more of one good, some of the alternative good must be given up. 
C) that any amount of goods could be produced by society if people worked harder. 
D) various combinations of guns and butter that can be produced under conditions of 6 percent unemployment. 
A) that in order to acquire more of one good, none of the alternative good must be given up. 
B) that in order to acquire more of one good, some of the alternative good must be given up. 
C) that any amount of goods could be produced by society if people worked harder. 
D) various combinations of guns and butter that can be produced under conditions of 6 percent unemployment.

Question 20

Improving the education level of the labor force will

Accepted Answer

A) shift the production possibilities curve inward. 
B) not shift the production possibilities curve since the total size of the labor force has not been changed. 
C) shift the production possibilities curve outward. 
D) cause a movement from a point inside the production possibilities curve to a point on the curve. 
A) shift the production possibilities curve inward. 
B) not shift the production possibilities curve since the total size of the labor force has not been changed. 
C) shift the production possibilities curve outward. 
D) cause a movement from a point inside the production possibilities curve to a point on the curve.

An increase in the unemployment rate would be shown on a production possibilities curve by

The wealth of nations is determined by the resources available to a nation and was discussed in 1776 by the famous economist, _________________.

An inward shift of the production possibilities curve

-In 1944 the U.S. economy was temporarily operating at point ________.

The Law of Increasing Cost is based upon which of the following?

Economic growth is difficult for poor countries because

Which statement is true?

Hypothetical Production Schedule for a Two-Product Economy -If the economy produces 27 consumer goods and 12 capital goods, the economy would be producing __________________ (outside/on/inside) the production possibilities curve.

Statement I. Employment discrimination causes underemployment. Statement II. The concept of opportunity cost has little validity in the global economy.

Opportunity cost can be best defined as

If you own a building and you decide to use that building to open a restaurant,

Which statement is the most accurate?

In order to raise our rate of economic growth our country needs to

Why did the U.S. temporarily operate outside the production possibilities frontier in 1942, 1943, and 1944?

-The economy usually operates at point _______.

In the American economy, the central figure is the _______________.

-If we moved from point T to point R we would be

An improvement in technology will cause the

A production possibilities curve shows

Improving the education level of the labor force will

A Brief Economic History of the United States

The Mixed Economy

Supply and Demand

Demand, Supply, and Equilibrium

The Price Elasticities of Demand and Supply

Theory of Consumer Behavior

Cost

Profit, Loss, and Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Corporate Mergers and Antitrust

Demand in the Factor Market

Labor Unions

Labor Markets and Wage Rates

Rent, Interest, and Profit

Income Distribution and Poverty

International Trade

International Finance

Filters

Exam 2: Resource Utilization

An increase in the unemployment rate would be shown on a production possibilities curve by

The wealth of nations is determined by the resources available to a nation and was discussed in 1776 by the famous economist, _________________.

An inward shift of the production possibilities curve

-In 1944 the U.S. economy was temporarily operating at point ________.

The Law of Increasing Cost is based upon which of the following?

Economic growth is difficult for poor countries because

Which statement is true?

Hypothetical Production Schedule for a Two-Product Economy -If the economy produces 27 consumer goods and 12 capital goods, the economy would be producing __________________ (outside/on/inside) the production possibilities curve.

Statement I. Employment discrimination causes underemployment. Statement II. The concept of opportunity cost has little validity in the global economy.

Opportunity cost can be best defined as

If you own a building and you decide to use that building to open a restaurant,

Which statement is the most accurate?

In order to raise our rate of economic growth our country needs to

Why did the U.S. temporarily operate outside the production possibilities frontier in 1942, 1943, and 1944?

-The economy usually operates at point _______.

In the American economy, the central figure is the _______________.

-If we moved from point T to point R we would be

An improvement in technology will cause the

A production possibilities curve shows

Improving the education level of the labor force will

A Brief Economic History of the United States

The Mixed Economy

Supply and Demand

Demand, Supply, and Equilibrium

The Price Elasticities of Demand and Supply

Theory of Consumer Behavior

Cost

Profit, Loss, and Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Corporate Mergers and Antitrust

Demand in the Factor Market

Labor Unions

Labor Markets and Wage Rates

Rent, Interest, and Profit

Income Distribution and Poverty

International Trade

International Finance

Filters