Question 1

Which of the following words and phrases best captures the notion of equality?

Accepted Answer

A)   minimum waste
B)   maximum benefit
C)   sameness
D)   efficiencyE) None of the above
F) C) and D)

Question 2

Annie is an excellent baker and Sam has a plentiful farm. If Sam trades eggs and butter to Annie for some of Annie's bread and pastries,

Accepted Answer

A)   only Sam is made better off by trade.
B)   only Annie is made better off by trade.
C)   both Sam and Annie are made better off by trade.
D)   neither Sam nor Annie are made better off by trade.E) B) and D)
F) A) and B)

Question 3

You have driven 800 miles on a vacation and then you notice that you are only 15 miles from an attraction you hadn't known about, but would really like to see. In computing the opportunity cost of visiting this attraction you had not planned to visit, you should include

Accepted Answer

A)   both the cost of driving the first 800 miles and the next 15 miles.
B)   the cost of driving the first 800 miles, but not the cost of driving the next 15 miles.
C)   the cost of driving the next 15 miles, but not the cost of driving the first 800 miles.
D)   neither the cost of driving the first 800 miles nor the cost of driving the next 15 miles.E) None of the above
F) B) and C)

Question 4

In most societies, resources are allocated by

Accepted Answer

A)   a single central planner.
B)   a small number of central planners.
C)   those firms that use resources to provide goods and services.
D)   the combined actions of millions of households and firms.E) A) and B)
F) B) and D)

Question 5

The business cycle is the

Accepted Answer

A)   relationship between unemployment and inflation.
B)   irregular fluctuations in economic activity.
C)   positive relationship between the quantity of money in an economy and inflation.
D)   predictable changes in economic activity due to changes in government spending and taxes.E) All of the above
F) A) and B)

Question 6

Trade between the United States and Guatemala

Accepted Answer

A)   benefits both the United States and Guatemala.
B)   is a losing proposition for the United States because Guatemalan labor is less expensive than U.S. labor.
C)   is a losing proposition for Guatemala because capital is much more abundant in the U.S. than in Guatemala.
D)   is a losing proposition for Guatemala because U.S. workers are more productive than Guatemalan workers.E) A) and B)
F) None of the above

Question 7

Explain how trade with other countries is beneficial.

Accepted Answer

Trade allows countri...

Question 8

Economists use the term to refer to an increase in the overall level of prices in the economy.

Accepted Answer

The answer of Economists use the term to refer to...

Question 9

Which of the following is the primary cause of inflation?

Accepted Answer

A)   an increase in the quantity of money
B)   an increase in government spending
C)   an increase in unemployment
D)   an increase in productivityE) None of the above
F) B) and D)

Question 10

It costs a company $35,000 to produce 500 graphing calculators. The company's cost will be $35,080 if it produces an additional graphing calculator. If the company produces 501 graphing calculators then

Accepted Answer

A)   its average cost is greater than its marginal cost.
B)   its average cost and its marginal cost are equal.
C)   its average cost is less than its marginal cost.
D)   This cannot be determined from the information given.E) A) and B)
F) All of the above

Question 11

The principle that trade can make everyone better off applies to

Accepted Answer

A)   individuals.
B)   families.
C)   countries.
D)   All of the aboveE) A) and D)
F) A) and C)

Question 12

Productivity is defined as the quantity of goods and services produced from each unit of labor input.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following would a permanent increase in the growth rate of the money supply change permanently?

Accepted Answer

A)   inflation
B)   unemployment
C)   both inflation and unemployment
D)   neither inflation nor unemploymentE) A) and B)
F) None of the above

Question 14

Scenario 1-1
You have the afternoon free. You have a choice between going to the movies with a friend or studying economics for three hours. If you go to the movies, you will spend $8.00 on a ticket and $4.50 on popcorn. If you choose to study economics for three hours, you will raise your exam grade by 10 points.
-Refer to Scenario 1-1. What is your opportunity cost of studying economics?

Accepted Answer

The enjoyment you wo...

Question 15

After much consideration, you have chosen Cancun over Ft. Lauderdale as your Spring Break destination this year. However, Spring Break is still months away, and you may reverse this decision. Which of the following events would prompt you to reverse this decision?

Accepted Answer

A)   The marginal benefit of going to Cancun increases.
B)   The marginal cost of going to Cancun decreases.
C)   The marginal benefit of going to Ft. Lauderdale decreases.
D)   The marginal cost of going to Ft. Lauderdale decreases.E) C) and D)
F) None of the above

Question 16

Scenario 1-6
It costs a company $30,000 to produce 600 heart rate monitors. The company's cost will be $30,070 if it produces an additional heart rate monitor. The company is currently producing 600 heart rate monitors.
-Refer to Scenario 1-6. What is the company's average cost?

Accepted Answer

The answer of Scenario 1-6
It costs a company $30,000 to...

Question 17

When the government attempts to improve equality in an economy the result is often

Accepted Answer

A)   an increase in overall output in the economy.
B)   additional government revenue since overall income will increase.
C)   a reduction in equality.
D)   a reduction in efficiency.E) B) and D)
F) B) and C)

Question 18

Which of the following is not generally regarded by economists as a legitimate reason for the government to intervene in a market?

Accepted Answer

A)   to promote efficiency
B)   to promote equality
C)   to enforce property rights
D)   to protect an industry from foreign competitionE) B) and D)
F) C) and D)

Question 19

Yvette buys and sells real estate. Two weeks ago, she paid $300,000 for a house on Pine Street, intending to spend $50,000 on repairs and then sell the house for $400,000. Last week, the city government announced a plan to build a new landfill on Pine Street just down the street from the house Yvette purchased. As a result of the city's announced plan, Yvette is weighing two alternatives: She can go ahead with the $50,000 in repairs and then sell the house for $290,000, or she can forgo the repairs and sell the house as it is for $250,000. She should

Accepted Answer

A)   keep the house and live in it.
B)   go ahead with the $50,000 in repairs and sell the house for $290,000.
C)   forgo the repairs and sell the house as it is for $250,000.
D)   move the house from Pine Street to a more desirable location, regardless of the cost of doing so.E) B) and C)
F) A) and D)

Question 20

The business cycle refers to fluctuations in economic activity such as employment and production.

Accepted Answer

A) True 
 B)False

Exam 1: Ten Principles of Economics

The principle that trade can make everyone better off applies to

Correct Answer
verified

Trade between the United States and Guatemala

Correct Answer
verified

Explain how trade with other countries is beneficial.

Correct Answer
verified
Trade allows countri...
View Answer

Correct Answer
verified

Which of the following would a permanent increase in the growth rate of the money supply change permanently?

Correct Answer
verified

It costs a company $35,000 to produce 500 graphing calculators. The company's cost will be $35,080 if it produces an additional graphing calculator. If the company produces 501 graphing calculators then

Correct Answer
verified

Correct Answer
verified
The enjoyment you wo...
View Answer

Economists use the term to refer to an increase in the overall level of prices in the economy.

Correct Answer
verified

You have driven 800 miles on a vacation and then you notice that you are only 15 miles from an attraction you hadn't known about, but would really like to see. In computing the opportunity cost of visiting this attraction you had not planned to visit, you should include

Correct Answer
verified

Which of the following words and phrases best captures the notion of equality?

Correct Answer
verified

After much consideration, you have chosen Cancun over Ft. Lauderdale as your Spring Break destination this year. However, Spring Break is still months away, and you may reverse this decision. Which of the following events would prompt you to reverse this decision?

Correct Answer
verified

In most societies, resources are allocated by

Correct Answer
verified

Which of the following is not generally regarded by economists as a legitimate reason for the government to intervene in a market?

Correct Answer
verified

Productivity is defined as the quantity of goods and services produced from each unit of labor input.

Correct Answer
verified

When the government attempts to improve equality in an economy the result is often

Correct Answer
verified

The business cycle refers to fluctuations in economic activity such as employment and production.

Correct Answer
verified

Annie is an excellent baker and Sam has a plentiful farm. If Sam trades eggs and butter to Annie for some of Annie's bread and pastries,

Correct Answer
verified

Which of the following is the primary cause of inflation?

Correct Answer
verified

Scenario 1-6 It costs a company $30,000 to produce 600 heart rate monitors. The company's cost will be $30,070 if it produces an additional heart rate monitor. The company is currently producing 600 heart rate monitors. -Refer to Scenario 1-6. What is the company's average cost?

Correct Answer
verified

The business cycle is the

Correct Answer
verified

Exam 1: Ten Principles of Economics

The principle that trade can make everyone better off applies to

Correct AnswerverifiedShow Answer

Trade between the United States and Guatemala

Correct AnswerverifiedShow Answer

Explain how trade with other countries is beneficial.

Correct AnswerverifiedTrade allows countri...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Which of the following would a permanent increase in the growth rate of the money supply change permanently?

Correct AnswerverifiedShow Answer

It costs a company $35,000 to produce 500 graphing calculators. The company's cost will be $35,080 if it produces an additional graphing calculator. If the company produces 501 graphing calculators then

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe enjoyment you wo...View AnswerShow Answer

Economists use the term to refer to an increase in the overall level of prices in the economy.

Correct AnswerverifiedShow Answer

You have driven 800 miles on a vacation and then you notice that you are only 15 miles from an attraction you hadn't known about, but would really like to see. In computing the opportunity cost of visiting this attraction you had not planned to visit, you should include

Correct AnswerverifiedShow Answer

Which of the following words and phrases best captures the notion of equality?

Correct AnswerverifiedShow Answer

After much consideration, you have chosen Cancun over Ft. Lauderdale as your Spring Break destination this year. However, Spring Break is still months away, and you may reverse this decision. Which of the following events would prompt you to reverse this decision?

Correct AnswerverifiedShow Answer

In most societies, resources are allocated by

Correct AnswerverifiedShow Answer

Which of the following is not generally regarded by economists as a legitimate reason for the government to intervene in a market?

Correct AnswerverifiedShow Answer

Productivity is defined as the quantity of goods and services produced from each unit of labor input.

Correct AnswerverifiedShow Answer

When the government attempts to improve equality in an economy the result is often

Correct AnswerverifiedShow Answer

The business cycle refers to fluctuations in economic activity such as employment and production.

Correct AnswerverifiedShow Answer

Annie is an excellent baker and Sam has a plentiful farm. If Sam trades eggs and butter to Annie for some of Annie's bread and pastries,

Correct AnswerverifiedShow Answer

Which of the following is the primary cause of inflation?

Correct AnswerverifiedShow Answer

Scenario 1-6 It costs a company $30,000 to produce 600 heart rate monitors. The company's cost will be $30,070 if it produces an additional heart rate monitor. The company is currently producing 600 heart rate monitors. -Refer to Scenario 1-6. What is the company's average cost?

Correct AnswerverifiedShow Answer

The business cycle is the

Correct AnswerverifiedShow Answer

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Trade allows countri...
View Answer

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Correct Answer
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The enjoyment you wo...
View Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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