Question 1

Economists are concerned with an individual's

Accepted Answer

A) needs because needs represent the most important goods to an individual. 
B) needs because economists define needs to be the goods people need to survive. 
C) wants because,unlike needs,wants lead to shortages in the economy. 
D) wants because the existence of wants leads to scarcity. 
A) needs because needs represent the most important goods to an individual. 
B) needs because economists define needs to be the goods people need to survive. 
C) wants because,unlike needs,wants lead to shortages in the economy. 
D) wants because the existence of wants leads to scarcity.

Question 2

Capital goods

Accepted Answer

A) are a special type of consumption goods. 
B) are consumed because they enhance the enjoyment consumers obtain from other goods and services. 
C) are goods used to make consumer goods and services. 
D) lead to inward shifts of a production possibilities curve. 
A) are a special type of consumption goods. 
B) are consumed because they enhance the enjoyment consumers obtain from other goods and services. 
C) are goods used to make consumer goods and services. 
D) lead to inward shifts of a production possibilities curve.

Question 3

Which of the following statements is TRUE about scarcity?

Accepted Answer

A) Both rich and poor people face the problem of scarcity. 
B) Scarcity exists only when supply is insufficient to meet demand. 
C) Scarcity exists only when a shortage exists. 
D) Scarcity can be eliminated when a country becomes richer. 
A) Both rich and poor people face the problem of scarcity. 
B) Scarcity exists only when supply is insufficient to meet demand. 
C) Scarcity exists only when a shortage exists. 
D) Scarcity can be eliminated when a country becomes richer.

Question 4

When a country specializes and trades with other countries,it is most likely that it specializes in goods for which

Accepted Answer

A) it has a comparative advantage. 
B) it has an absolute advantage. 
C) it has no advantage. 
D) are very costly to produce. 
A) it has a comparative advantage. 
B) it has an absolute advantage. 
C) it has no advantage. 
D) are very costly to produce.

Question 5

Division of labor increases the output of society by

Accepted Answer

A) eliminating scarcity. 
B) reducing the choices people have to make to a more manageable number. 
C) ensuring that people are happier in performing their work. 
D) allowing resources to specialize in the tasks for which they have a comparative advantage. 
A) eliminating scarcity. 
B) reducing the choices people have to make to a more manageable number. 
C) ensuring that people are happier in performing their work. 
D) allowing resources to specialize in the tasks for which they have a comparative advantage.

Question 6

If a person can make $70,000 as an accountant,$60,000 as a chef,$20,000 as a mechanic,and nothing as an opera singer,he or she has a comparative advantage in

Accepted Answer

A) accounting. 
B) being a chef. 
C) being a mechanic. 
D) opera singing. 
A) accounting. 
B) being a chef. 
C) being a mechanic. 
D) opera singing.

Question 7

One of the benefits of specialization is

Accepted Answer

A) greater output. 
B) people enjoy doing one repetitive task over and over. 
C) specialists cost less to hire. 
D) training costs are higher. 
A) greater output. 
B) people enjoy doing one repetitive task over and over. 
C) specialists cost less to hire. 
D) training costs are higher.

Question 8

Bill Bonecrusher graduates from college with a choice of playing professional football at $2 million a year or coaching for $50,000 a year.He decides to play football,but eight years later he quits football to make movies for $3 million a year.His opportunity cost at graduation was ________ and eight years later was ________.

Accepted Answer

A) $50,000; $2 million 
B) $2 million; $2 million 
C) $2 million; $3 million 
D) $50,000; $50,000 
A) $50,000; $2 million 
B) $2 million; $2 million 
C) $2 million; $3 million 
D) $50,000; $50,000

Question 9

Opportunity cost is best defined as

Accepted Answer

A) the sum of the dollar values of all alternatives given up when choices are made. 
B) the cost of producing the purchased goods. 
C) the next highest valued alternative when a choice is made. 
D) the dollar price of the purchased item. 
A) the sum of the dollar values of all alternatives given up when choices are made. 
B) the cost of producing the purchased goods. 
C) the next highest valued alternative when a choice is made. 
D) the dollar price of the purchased item.

Question 10

-Refer to the above figure.Which of the following would allow society to move to point d?

Accepted Answer

A) Producing efficiently 
B) Concentrating production in wheat 
C) Increasing the quantity of labor 
D) Using the best land to produce wheat and the lower quality land to produce beans. 
A) Producing efficiently 
B) Concentrating production in wheat 
C) Increasing the quantity of labor 
D) Using the best land to produce wheat and the lower quality land to produce beans.

Question 11

When productive activities are organized according to the principle of the division of labor,

Accepted Answer

A) scarcity is eliminated. 
B) we do not devote enough resources for capital investment. 
C) total output increases due to the advantages of specialization. 
D) an inefficient outcome results. 
A) scarcity is eliminated. 
B) we do not devote enough resources for capital investment. 
C) total output increases due to the advantages of specialization. 
D) an inefficient outcome results.

Economists are concerned with an individual's

Capital goods

Which of the following statements is TRUE about scarcity?

When a country specializes and trades with other countries,it is most likely that it specializes in goods for which

Division of labor increases the output of society by

If a person can make $70,000 as an accountant,$60,000 as a chef,$20,000 as a mechanic,and nothing as an opera singer,he or she has a comparative advantage in

One of the benefits of specialization is

Opportunity cost is best defined as

-Refer to the above figure.Which of the following would allow society to move to point d?

When productive activities are organized according to the principle of the division of labor,

The Nature of Economics

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters

Exam 2: Scarcity and the World of Trade-Offs

Economists are concerned with an individual's

Capital goods

Which of the following statements is TRUE about scarcity?

When a country specializes and trades with other countries,it is most likely that it specializes in goods for which

Division of labor increases the output of society by

If a person can make $70,000 as an accountant,$60,000 as a chef,$20,000 as a mechanic,and nothing as an opera singer,he or she has a comparative advantage in

One of the benefits of specialization is

Opportunity cost is best defined as

-Refer to the above figure.Which of the following would allow society to move to point d?

When productive activities are organized according to the principle of the division of labor,

The Nature of Economics

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters