Question 1

A linear function can be distinguished by

Accepted Answer

A)   The continuous change in its slope.
B)   The same slope throughout the line.
C)   The changing relationship between the two variables.
D)   A shift in the function.E) B) and C)
F) A) and D)

Question 2

Table 1.2 shows the hypothetical trade-off between different combinations of Stealth bombers and B-1 bombers that might be produced in a year with the limited U.S. capacity, ceteris paribus. Complete the table by calculating the required opportunity costs for both the B-1 and Stealth bombers.  On the basis of your calculations in Table 1.2, what is the opportunity cost of producing at point B rather than point C?

Accepted Answer

A)   45 B-1 bombers.
B)   35 Stealth bombers.
C)   180 Stealth bombers.
D)   10 B-1 bombers.E) A) and D)
F) A) and C)

Question 3

A movement from point C to point A in Figure 1.4 results in

Accepted Answer

A)   More efficient production.
B)   Permanent unemployment of workers producing plasma televisions.
C)   A reallocation of resources from MP3 player production to plasma television production.
D)   A reallocation of resources from plasma television production to MP3 player production.E) B) and C)
F) All of the above

Question 4

One World View article is titled "Chronic Food Shortage Shows Despite Efforts by North Korea to Hide It." If North Korea reduces the size of its military and produces more food, this is most consistent with

Accepted Answer

A)   A movement along the economy's production possibilities curve.
B)   Privatization.
C)   A laissez faire policy.
D)   The law of increasing opportunity costs.E) A) and B)
F) B) and D)

Question 5

In Figure 1.9, as you move up the curve from point J toward point M, the slope

Accepted Answer

A)   Increases.
B)   Remains constant.
C)   Decreases.
D)   Becomes negative.E) B) and C)
F) All of the above

Question 6

In terms of the production possibilities curve, inefficiency is represented by

Accepted Answer

A)   All points on the curve.
B)   All points outside the curve.
C)   All points inside the curve.
D)   A rightward shift of the curve.E) A) and D)
F) All of the above

Question 7

Table 1.3 shows the hypothetical trade-off between different combinations of brushes and combs that might be produced in a year with the limited capacity for Country X, ceteris paribus. Complete the table by calculating the required opportunity costs for brushes and combs.  On the basis of your calculations in Table 1.3, in the production range of 21 to 23 brushes the opportunity cost of producing more comb in terms of brushes is

Accepted Answer

A)   1/21.
B)   21/23.
C)   1/2.
D)   4.Shifting resources toward more brushes (2)  requires a drop in the production of combs (1) . Therefore for each 1 brush, ½ a comb is given up (1 divided by 2) .E) A) and B)
F) A) and C)

Question 8

Explain the difference between macroeconomics and microeconomics. Give examples of each.

Accepted Answer

Macroeconomics focuses on aggregate econ...

Question 9

Which of the following is an assumption under which the production possibilities curve is drawn?

Accepted Answer

A)   Total unemployment is zero.
B)   The supply of resources is fixed.
C)   The price level is changing.
D)   Technology is changing.E) B) and C)
F) A) and D)

Question 10

Which of the following is not a basic decision that all nations must confront?

Accepted Answer

A)   Should we have economic growth?
B)   How should we produce goods and services?
C)   For whom should goods and services be produced?
D)   What goods and services should we produce?E) A) and B)
F) A) and C)

Question 11

At which point is society employing some of its available technology but not all of it? (See Figure 1.1.)

Accepted Answer

A)  A.
B)  B.
C)  C.
D)  D.E) All of the above
F) A) and B)

Question 12

Which of the following is not one of the three core economic issues that must be resolved?

Accepted Answer

A)   How to produce the goods and services we select.
B)   What to produce with unlimited resources.
C)   Who should get the goods and services we produce.
D)   What to produce with limited resources.E) A) and B)
F) A) and C)

Question 13

Economic models are used by economists to

Accepted Answer

A)   Predict economic behavior.
B)   Develop economic policies.
C)   Explain economic behavior.
D)   All of the choices are correct.E) A) and B)
F) B) and C)

Question 14

Table 1.2 shows the hypothetical trade-off between different combinations of Stealth bombers and B-1 bombers that might be produced in a year with the limited U.S. capacity, ceteris paribus. Complete the table by calculating the required opportunity costs for both the B-1 and Stealth bombers.  On the basis of your calculations in Table 1.2, what is gained by producing at point B rather than point A?

Accepted Answer

A)   35 B-1 bombers.
B)   195 Stealth bombers.
C)   15 B-1 bombers.
D)   15 Stealth bombers.E) A) and D)
F) B) and C)

Question 15

Government intervention may achieve a more optimal outcome than the market mechanism when addressing

Accepted Answer

A)   Inefficient bureaucracy.
B)   Consumption of cigarettes.
C)   Theme park construction.
D)   None of the choices are correct.E) All of the above
F) None of the above

Question 16

Refer to Figure 1.7. This economy will achieve efficiency in production at

Accepted Answer

A)   Point D only.
B)   Point G only.
C)   Point J only.
D)   Points D, G, and J.E) B) and C)
F) None of the above

Question 17

The basic factors of production include

Accepted Answer

A)   Land, labor, money, and capital.
B)   Land, labor, money, and inputs.
C)   Labor and money.
D)   Land, labor, capital, and entrepreneurship.E) B) and D)
F) A) and B)

Question 18

Adam Smith's invisible hand is now called

Accepted Answer

A)   Economic growth.
B)   The market mechanism.
C)   Opportunity cost.
D)   Laissez faire.E) B) and C)
F) A) and D)

Question 19

Which of the following is true when an economy is producing efficiently?

Accepted Answer

A)   The economy is producing on the production possibilities curve.
B)   The economy is producing outside the production possibilities curve.
C)   The economy is getting the fewest goods and services from the available resources.
D)   Everyone in the economy is happy.E) B) and D)
F) A) and D)

Question 20

If an economy is producing inside the production possibilities curve, then

Accepted Answer

A)   There is full employment of resources.
B)   It is operating efficiently.
C)   It can produce more of one good without giving up some of another good.
D)   There are not enough resources available to produce more output.E) A) and D)
F) None of the above

Exam 1: Economics: the Core Issues

Correct Answer
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Correct Answer
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Refer to Figure 1.7. This economy will achieve efficiency in production at

Correct Answer
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Which of the following is not one of the three core economic issues that must be resolved?

Correct Answer
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One World View article is titled "Chronic Food Shortage Shows Despite Efforts by North Korea to Hide It." If North Korea reduces the size of its military and produces more food, this is most consistent with

Correct Answer
verified

If an economy is producing inside the production possibilities curve, then

Correct Answer
verified

Correct Answer
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At which point is society employing some of its available technology but not all of it? (See Figure 1.1.)

Correct Answer
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Which of the following is an assumption under which the production possibilities curve is drawn?

Correct Answer
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Government intervention may achieve a more optimal outcome than the market mechanism when addressing

Correct Answer
verified

Which of the following is true when an economy is producing efficiently?

Correct Answer
verified

The basic factors of production include

Correct Answer
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Which of the following is not a basic decision that all nations must confront?

Correct Answer
verified

Economic models are used by economists to

Correct Answer
verified

A movement from point C to point A in Figure 1.4 results in

Correct Answer
verified

A linear function can be distinguished by

Correct Answer
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Explain the difference between macroeconomics and microeconomics. Give examples of each.

Correct Answer
verified
Macroeconomics focuses on aggregate econ...
View Answer

Adam Smith's invisible hand is now called

Correct Answer
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In Figure 1.9, as you move up the curve from point J toward point M, the slope

Correct Answer
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In terms of the production possibilities curve, inefficiency is represented by

Correct Answer
verified

Exam 1: Economics: the Core Issues

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Refer to Figure 1.7. This economy will achieve efficiency in production at

Correct AnswerverifiedShow Answer

Which of the following is not one of the three core economic issues that must be resolved?

Correct AnswerverifiedShow Answer

One World View article is titled "Chronic Food Shortage Shows Despite Efforts by North Korea to Hide It." If North Korea reduces the size of its military and produces more food, this is most consistent with

Correct AnswerverifiedShow Answer

If an economy is producing inside the production possibilities curve, then

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

At which point is society employing some of its available technology but not all of it? (See Figure 1.1.)

Correct AnswerverifiedShow Answer

Which of the following is an assumption under which the production possibilities curve is drawn?

Correct AnswerverifiedShow Answer

Government intervention may achieve a more optimal outcome than the market mechanism when addressing

Correct AnswerverifiedShow Answer

Which of the following is true when an economy is producing efficiently?

Correct AnswerverifiedShow Answer

The basic factors of production include

Correct AnswerverifiedShow Answer

Which of the following is not a basic decision that all nations must confront?

Correct AnswerverifiedShow Answer

Economic models are used by economists to

Correct AnswerverifiedShow Answer

A movement from point C to point A in Figure 1.4 results in

Correct AnswerverifiedShow Answer

A linear function can be distinguished by

Correct AnswerverifiedShow Answer

Explain the difference between macroeconomics and microeconomics. Give examples of each.

Correct AnswerverifiedMacroeconomics focuses on aggregate econ...View AnswerShow Answer

Adam Smith's invisible hand is now called

Correct AnswerverifiedShow Answer

In Figure 1.9, as you move up the curve from point J toward point M, the slope

Correct AnswerverifiedShow Answer

In terms of the production possibilities curve, inefficiency is represented by

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Macroeconomics focuses on aggregate econ...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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