Question 1

Hypothetical Production Schedule for a Two-Product Economy 
-If the society chooses point B instead of point C,

Accepted Answer

A) economic growth is more likely. 
B) economic growth is less likely. 
C) the chances of achieving economic growth will not be affected. 
D) unemployment will result.

Question 2

Large firms are able to lower their costs by taking advantage of __________________.

Accepted Answer

The answer of Large firms are able to lower their...

Question 3

For most of World War II,our economy temporarily operated ____________ our production possibilities frontier.

Accepted Answer

The answer of For most of World War II,our economy...

Question 4

-Which point shows where our economy would have a 100 percent unemployment rate?

Accepted Answer

A) Point A 
B) Point B 
C) Point C 
D) Point D 
E) Point E

Question 5

A small Caribbean island-country produces only pineapples and rum.If resources are used efficiently in the economy,

Accepted Answer

A) it will not be possible to produce more rum without decreasing the production of pineapples. 
B) it will be possible to produce more pineapples without decreasing the production of rum. 
C) it will be producing on its production possibilities curve. 
D) it will not be possible to produce more rum without decreasing the production of pineapples AND it will be producing on its production possibilities curve. 
E) it will be possible to produce more pineapples without decreasing the production of rum AND it will be producing on its production possibilities curvE.

Question 6

Which of the following events in U.S.history did not create economic growth (shift the production possibilities curve outward)?

Accepted Answer

A) The Louisiana Purchase in 1803 that nearly doubled the land mass of the United States. 
B) Inventions of machines such as Cyrus McCormick's mechanical reaper. 
C) The introduction of the moving assembly line in automobile production by Henry Olds. 
D) The dramatic reduction in the U.S.unemployment rate from 1939 to 1941 as we prepared to enter World War II.

Question 7

-Place point C on the graph to indicate where our economy operated in 1997.

Accepted Answer

The answer of 
-Place point C on the graph to...

Question 8

Hypothetical Production Schedule for Two-Product Economy 
-What is the opportunity cost of moving from point A to point B?

Accepted Answer

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

Question 9

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.

Question 10

If the country wanted to produce the maximum total number of units of guns and butter combined,it would produce at point(s)_______________.

Accepted Answer

The answer of If the country wanted to produce the...

Question 11

Referring to a production possibilities curve and the goods being compared,depict the economic event.The economy moves from full employment to a serious recession (capital goods vs.consumer goods).

Accepted Answer

A) A movement from a point inside the curve to a point on or near the curve 
B) A movement from a point on or near the curve to a point inside the curve 
C) A shift in the entire curve to the right (outward) 
D) A shift in the entire curve to the left (inward) 
E) A movement along the curve

Question 12

-Statement I.The definition of economics is that equilibrium is when supply and demand are equal.
Statement II.Human wants are limited because our resources are limited.

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.

Question 13

-If the economy was producing at point X and moved to point Y,

Accepted Answer

A) it would have moved from where the economy operates most of the time to a severe recession. 
B) it would have moved from where the economy operates most of the time to a depression. 
C) the unemployment rate would increase. 
D) it would have moved from where the economy operates most of the time to a severe recession AND the unemployment rate would increase. 
E) it would have moved from where the economy operates most of the time to a depression AND the unemployment rate would increasE.

Question 14

Our economy would be operating at full employment with labor unemployment rate of ___ percent and a capacity utilization rate of _____ percent.

Accepted Answer

A) 5;95 
B) 5;85 
C) 10;95 
D) 10;85

Question 15

Which one of the following is the most accurate?

Accepted Answer

A) In recent years our economy was at full employment until 2010. 
B) Our economy operated outside of its production possibilities curve in 2009 and 2010. 
C) Our economy is currently operating on its production possibilities curve. 
D) Our economy is currently operation inside its production possibilities curve.

Question 16

-If the economy were at full employment and now producing at point Y,

Accepted Answer

A) the unemployment rate would increase. 
B) the unemployment rate would decrease. 
C) the production possibilities frontier would have shifted inward. 
D) the production possibilities frontier would have shifted outwarD. 
E) there would be a movement along the frontier.

Question 17

Which of the following is not demonstrated by a production possibility curve?

Accepted Answer

A) Scarcity 
B) Opportunity cost 
C) Necessity for choice due to scarcity 
D) Price

Question 18

Which statement is true?

Accepted Answer

A) On the production possibilities frontier we have zero unemployment. 
B) On the production possibilities frontier 95 percent of the labor force is employed. 
C) To get out of a recession,we must produce at some point beyond our production possibilities frontier. 
D) To have economic growth,we must push the production possibilities frontier inwarD.

Question 19

Referring to a production possibilities curve and the goods being compared,depict the economic event.Millions of immigrants came to the United States in the second half of the 19th century to work on the transcontinental railroad (capital goods vs.consumer goods).

Accepted Answer

A) A movement from a point inside the curve to a point on or near the curve 
B) A movement from a point on or near the curve to a point inside the curve 
C) A shift in the entire curve to the right (outward) 
D) A shift in the entire curve to the left (inward) 
E) A movement along the curve

Question 20

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.

Exam 2: Resource Utilization

Hypothetical Production Schedule for a Two-Product Economy -If the society chooses point B instead of point C,

Large firms are able to lower their costs by taking advantage of __________________.

For most of World War II,our economy temporarily operated ____________ our production possibilities frontier.

-Which point shows where our economy would have a 100 percent unemployment rate?

A small Caribbean island-country produces only pineapples and rum.If resources are used efficiently in the economy,

Which of the following events in U.S.history did not create economic growth (shift the production possibilities curve outward) ?

-Place point C on the graph to indicate where our economy operated in 1997.

Hypothetical Production Schedule for Two-Product Economy -What is the opportunity cost of moving from point A to point B?

Opportunity cost can be best defined as

If the country wanted to produce the maximum total number of units of guns and butter combined,it would produce at point(s)_______________.

Referring to a production possibilities curve and the goods being compared,depict the economic event.The economy moves from full employment to a serious recession (capital goods vs.consumer goods) .

-Statement I.The definition of economics is that equilibrium is when supply and demand are equal. Statement II.Human wants are limited because our resources are limited.