Question 1

President Gerald Ford referred to inflation as

Accepted Answer

A)   a blight on our nation's economy.
B)   a necessary evil to combat high unemployment.
C)   public enemy number one.
D)   a fly in the ointment.E) A) and B)
F) A) and C)

Question 2

Use the following Scenario to answer the question scenario 1-3 : 
It costs a company $35,000 to produce 700 graphing calculators. The company's cost will be $35,070 if it produces an additional graphing calculator. The company is currently producing 700 graphing calculators.
-Refer to Scenario 1-3. A customer is willing to pay $60 for the 701th calculator. Should the company produce and sell it? Explain.

Accepted Answer

No, because the marg...

Question 3

In a particular country in 2000, the average worker needed to work 40 hours to produce 55 units of output. In that same country in 2008, the average worker needed to work 30 hours to produce 45 units of output. In that country, the productivity of the average worker

Accepted Answer

A)   decreased by about 6 percent between 2000 and 2008.
B)   remained unchanged between 2000 and 2008.
C)   increased by about 9 percent between 2000 and 2008.
D)   increased by about 18 percent between 2000 and 2008.E) None of the above
F) All of the above

Question 4

Use the following Scenario to answer the question scenario 1-2 :  
Suppose that you have a choice between going to the movies with a friend for two hours or working at your job. If you go to the movies, you will spend $7 on a ticket and $5 on popcorn. If you choose to work, you will earn $10 an hour.
-Refer to Scenario 1-2. What is your opportunity cost of working?

Accepted Answer

The enjoyment you wo...

Question 5

To increase living standards, public policy should

Accepted Answer

A)   ensure that workers are well educated and have the necessary tools and technology.
B)   make unemployment benefits more generous.
C)   move workers into jobs directly from high school.
D)   ensure a greater degree of equality, taking all income-earners into account.E) None of the above
F) All of the above

Question 6

Approximately what percentage of the world's economies experience scarcity?

Accepted Answer

A)   10%
B)   40%
C)   85%
D)   100%E) A) and B)
F) A) and D)

Question 7

What term refers to the property that society has limited resources and therefore cannot produce all the goods and services people wish to have?

Accepted Answer

A)   inefficiency
B)   inequality
C)   scarcity
D)   market failureE) C) and D)
F) B) and C)

Question 8

Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot.

Accepted Answer

A)   The cost of the parking permit is not part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
B)   The cost of the parking permit is part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
C)   Only half of the cost of the parking permit is part of the opportunity cost of attending college.
D)   The cost of the parking permit is not part of the opportunity cost of attending college under any circumstances.E) A) and B)
F) None of the above

Question 9

In the short run, which of the following rates of growth in the money supply is likely to lead to the highest level of unemployment in the economy?

Accepted Answer

A)   1 percent per year
B)   2 percent per year
C)   3 percent per year
D)   4 percent per yearE) A) and D)
F) B) and D)

Question 10

In 2011, the average American earned about $48,000 while the average Nigerian earned about $1,200. Which of the following statements is likely?

Accepted Answer

A)   The average American purchases more televisions than the average Nigerian.
B)   The average American has better nutrition and healthcare than the average Nigerian.
C)   The average American has a longer life expectancy than the average Nigerian.
D)   All of the above are correct.E) A) and D)
F) C) and D)

Question 11

Incomes of U.S. households in the 1970s and 1980s

Accepted Answer

A)   grew rapidly, due to the widespread success of labor unions in pushing up wages during those decades.
B)   grew rapidly, due to several increases in the minimum wage during those decades.
C)   grew rapidly, due to government policies that discouraged the importation of foreign products during those decades.
D)   grew slowly, due to slow growth of the output of goods and services per hour of U.S. workers' time during those decades.E) B) and C)
F) A) and D)

Question 12

Suppose that a country that has a high level of output per person agrees to trade with a country that has a low level of output per person. Which country can benefit?

Accepted Answer

A)   only the one with a low level of output per person.
B)   only the one with a high level of output per person.
C)   both
D)   neitherE) C) and D)
F) All of the above

Question 13

Use the following Scenario to answer the question 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. A customer is willing to pay $60 for the 601st heart rate monitor. Should the company produce and sell it? Explain.

Accepted Answer

No, because the marg...

Question 14

For markets to work well, there must be

Accepted Answer

A)   market power.
B)   a central planner.
C)   property rights.
D)   abundant, not scarce, resources.E) B) and D)
F) All of the above

Question 15

Use the following Scenario to answer the question 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 going to the movies?

Accepted Answer

$12.50 and...

Question 16

Rational people make decisions "at the margin" by comparing

Accepted Answer

A)   average costs and benefits.
B)   total costs and benefits.
C)   additional costs and benefits.
D)   opportunity costs and benefits.E) B) and C)
F) A) and C)

Question 17

When the United States trades with China,

Accepted Answer

A)   both countries will likely benefit.
B)   only United States will benefit.
C)   only China will benefit.
D)   neither country will benefit.E) None of the above
F) A) and C)

Question 18

Government policies resulting in reduced efficiency include
I. the welfare system
Ii. unemployment insurance
Iii. progressive income tax

Accepted Answer

A)   i)  only
B)   ii)  only
C)   i)  and ii)  only
D)   i) , ii) , and iii) E) C) and D)
F) B) and C)

Question 19

The broken window fallacy states that when a window breaks and someone spends money to repair it, they have created new economic activity that would not have otherwise taken place.

Accepted Answer

A) True 
 B)False

Question 20

A market economy cannot produce a socially desirable outcome because individuals are motivated by their own selfish interests.

Accepted Answer

A) True 
 B)False

Exam 1: Ten Principles of Economics

Approximately what percentage of the world's economies experience scarcity?

Correct Answer
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Correct Answer
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The enjoyment you wo...
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What term refers to the property that society has limited resources and therefore cannot produce all the goods and services people wish to have?

Correct Answer
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Correct Answer
verified
No, because the marg...
View Answer

Correct Answer
verified
No, because the marg...
View Answer

Government policies resulting in reduced efficiency include I. the welfare system Ii. unemployment insurance Iii. progressive income tax

Correct Answer
verified

In a particular country in 2000, the average worker needed to work 40 hours to produce 55 units of output. In that same country in 2008, the average worker needed to work 30 hours to produce 45 units of output. In that country, the productivity of the average worker

Correct Answer
verified

The broken window fallacy states that when a window breaks and someone spends money to repair it, they have created new economic activity that would not have otherwise taken place.

Correct Answer
verified

In 2011, the average American earned about $48,000 while the average Nigerian earned about $1,200. Which of the following statements is likely?

Correct Answer
verified

Incomes of U.S. households in the 1970s and 1980s

Correct Answer
verified

Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot.

Correct Answer
verified

A market economy cannot produce a socially desirable outcome because individuals are motivated by their own selfish interests.

Correct Answer
verified

When the United States trades with China,

Correct Answer
verified

Rational people make decisions "at the margin" by comparing

Correct Answer
verified

In the short run, which of the following rates of growth in the money supply is likely to lead to the highest level of unemployment in the economy?

Correct Answer
verified

Suppose that a country that has a high level of output per person agrees to trade with a country that has a low level of output per person. Which country can benefit?

Correct Answer
verified

Correct Answer
verified
$12.50 and...
View Answer

For markets to work well, there must be

Correct Answer
verified

President Gerald Ford referred to inflation as

Correct Answer
verified

To increase living standards, public policy should

Correct Answer
verified

Exam 1: Ten Principles of Economics

Approximately what percentage of the world's economies experience scarcity?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe enjoyment you wo...View AnswerShow Answer

What term refers to the property that society has limited resources and therefore cannot produce all the goods and services people wish to have?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedNo, because the marg...View AnswerShow Answer

Correct AnswerverifiedNo, because the marg...View AnswerShow Answer

Government policies resulting in reduced efficiency include I. the welfare system Ii. unemployment insurance Iii. progressive income tax

Correct AnswerverifiedShow Answer

In a particular country in 2000, the average worker needed to work 40 hours to produce 55 units of output. In that same country in 2008, the average worker needed to work 30 hours to produce 45 units of output. In that country, the productivity of the average worker

Correct AnswerverifiedShow Answer

The broken window fallacy states that when a window breaks and someone spends money to repair it, they have created new economic activity that would not have otherwise taken place.

Correct AnswerverifiedShow Answer

In 2011, the average American earned about $48,000 while the average Nigerian earned about $1,200. Which of the following statements is likely?

Correct AnswerverifiedShow Answer

Incomes of U.S. households in the 1970s and 1980s

Correct AnswerverifiedShow Answer

Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot.

Correct AnswerverifiedShow Answer

A market economy cannot produce a socially desirable outcome because individuals are motivated by their own selfish interests.

Correct AnswerverifiedShow Answer

When the United States trades with China,

Correct AnswerverifiedShow Answer

Rational people make decisions "at the margin" by comparing

Correct AnswerverifiedShow Answer

In the short run, which of the following rates of growth in the money supply is likely to lead to the highest level of unemployment in the economy?

Correct AnswerverifiedShow Answer

Suppose that a country that has a high level of output per person agrees to trade with a country that has a low level of output per person. Which country can benefit?

Correct AnswerverifiedShow Answer

Correct Answerverified$12.50 and...View AnswerShow Answer

For markets to work well, there must be

Correct AnswerverifiedShow Answer

President Gerald Ford referred to inflation as

Correct AnswerverifiedShow Answer

To increase living standards, public policy should

Correct AnswerverifiedShow Answer

Correct Answer
verified

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

Correct Answer
verified

Correct Answer
verified
No, because the marg...
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Correct Answer
verified
No, because the marg...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
$12.50 and...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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