Question 1

Which of the following is not an example of scarcity?

Accepted Answer

A)   Only some people can afford to buy a BMW automobile.
B)   Every individual in society cannot attain the highest standard of living to which he or she might aspire.
C)   Miranda has an unlimited supply of oranges in her orchard.
D)   Each member of a household cannot get everything he or she wants.E) None of the above
F) A) and C)

Question 2

Government policies that improve equality usually increase efficiency at the same time.

Accepted Answer

A) True 
 B)False  False

Question 3

Which of the following is a principle concerning how people interact?

Accepted Answer

A)   Markets are usually a good way to organize economic activity.
B)   Rational people think at the margin.
C)   People respond to incentives.
D)   All of the above are correct.E) A) and D)
F) A) and C)

Question 4

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) A) and D)
F) A) and C)

Question 5

The principle that trade can make everyone better off applies to

Accepted Answer

A)   individuals.
B)   families.
C)   countries.
D)   All of the aboveE) None of the above
F) A) and B)

Question 6

Economics is the study of ______.

Accepted Answer

how societ...

Question 7

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. What is the company's average cost?

Accepted Answer

The answer of Scenario 1-3
It costs a company $35,000 to...

Question 8

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) A) and C)
F) None of the above

Question 9

Scenario 1-4 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 $12.00 on a ticket and $4.75 on popcorn. If you choose to study economics for three hours, you will raise your exam grade by 15 points.
-Refer to Scenario 1-4. What is your opportunity cost of studying economics?

Accepted Answer

The enjoyment you wo...

Question 10

It costs a furniture company $8,750 to produce 25 tables. The company's total cost will be $9,125 if it produces a 26th table. If the company produces 26 tables, 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) All of the above
F) A) and B)

Question 11

Benefits from trade would not include

Accepted Answer

A)   the ability of people and nations to specialize.
B)   a greater variety of goods and services becoming available.
C)   less competition.
D)   lower prices.E) A) and B)
F) B) and C)

Question 12

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 13

What is another word for "marginal"?

Accepted Answer

incremental; additional

Question 14

Explain the concept of externality and give an example.

Accepted Answer

The impact of one pe...

Question 15

In the short-run, society faces a tradeoff between inflation and unemployment.

Accepted Answer

A) True 
 B)False

Question 16

What you give up to obtain an item is called your

Accepted Answer

A)   opportunity cost.
B)   explicit cost.
C)   monetary cost.
D)   direct cost.E) None of the above
F) A) and D)

Question 17

Communist countries worked under the premise that

Accepted Answer

A)   markets were the best way to organize economic activity.
B)   central planners were in the best position to determine the allocation of scarce resources in the economy.
C)   households and firms, guided by an "invisible hand," could achieve the most efficient allocation of scarce resources.
D)   allowing the market forces of supply and demand to operate with no government intervention would achieve the most efficient allocation of scarce resources.E) C) and D)
F) B) and D)

Question 18

Explain how trade with other countries is beneficial.

Accepted Answer

Trade allows countri...

Question 19

Dale is a guitar teacher and Terrence is a tile layer. If Dale teaches Terrence's daughter to play the guitar in exchange for Terrence tiling Dale's kitchen floor,

Accepted Answer

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

Question 20

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) A) and D)
F) C) and D)

Exam 1: Ten Principles of Economics

Which of the following is not an example of scarcity?

Correct Answer
verified

Government policies that improve equality usually increase efficiency at the same time.

Correct Answer
verified
False

Which of the following is a principle concerning how people interact?

Correct Answer
verified

When the United States trades with China,

Correct Answer
verified

The principle that trade can make everyone better off applies to

Correct Answer
verified

Economics is the study of ______.

Correct Answer
verified
how societ...
View Answer

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. What is the company's average cost?

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
The enjoyment you wo...
View Answer

It costs a furniture company $8,750 to produce 25 tables. The company's total cost will be $9,125 if it produces a 26th table. If the company produces 26 tables, then

Correct Answer
verified

Benefits from trade would not include

Correct Answer
verified

Correct Answer
verified
$12.50 and...
View Answer

What is another word for "marginal"?

Correct Answer
verified
incremental; additional

Explain the concept of externality and give an example.

Correct Answer
verified
The impact of one pe...
View Answer

In the short-run, society faces a tradeoff between inflation and unemployment.

Correct Answer
verified

What you give up to obtain an item is called your

Correct Answer
verified

Communist countries worked under the premise that

Correct Answer
verified

Explain how trade with other countries is beneficial.

Correct Answer
verified
Trade allows countri...
View Answer

Dale is a guitar teacher and Terrence is a tile layer. If Dale teaches Terrence's daughter to play the guitar in exchange for Terrence tiling Dale's kitchen floor,

Correct Answer
verified
C

For markets to work well, there must be

Correct Answer
verified

Exam 1: Ten Principles of Economics

Which of the following is not an example of scarcity?

Correct AnswerverifiedShow Answer

Government policies that improve equality usually increase efficiency at the same time.

Correct AnswerverifiedFalse

Which of the following is a principle concerning how people interact?

Correct AnswerverifiedShow Answer

When the United States trades with China,

Correct AnswerverifiedShow Answer

The principle that trade can make everyone better off applies to

Correct AnswerverifiedShow Answer

Economics is the study of ______.

Correct Answerverifiedhow societ...View AnswerShow Answer

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. What is the company's average cost?

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 AnswerverifiedThe enjoyment you wo...View AnswerShow Answer

It costs a furniture company $8,750 to produce 25 tables. The company's total cost will be $9,125 if it produces a 26th table. If the company produces 26 tables, then

Correct AnswerverifiedShow Answer

Benefits from trade would not include

Correct AnswerverifiedShow Answer

Correct Answerverified$12.50 and...View AnswerShow Answer

What is another word for "marginal"?

Correct Answerverifiedincremental; additional

Explain the concept of externality and give an example.

Correct AnswerverifiedThe impact of one pe...View AnswerShow Answer

In the short-run, society faces a tradeoff between inflation and unemployment.

Correct AnswerverifiedShow Answer

What you give up to obtain an item is called your

Correct AnswerverifiedShow Answer

Communist countries worked under the premise that

Correct AnswerverifiedShow Answer

Explain how trade with other countries is beneficial.

Correct AnswerverifiedTrade allows countri...View AnswerShow Answer

Dale is a guitar teacher and Terrence is a tile layer. If Dale teaches Terrence's daughter to play the guitar in exchange for Terrence tiling Dale's kitchen floor,

Correct AnswerverifiedC

For markets to work well, there must be

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
verified
False

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
how societ...
View Answer

Correct Answer
verified

Correct Answer
verified

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

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
$12.50 and...
View Answer

Correct Answer
verified
incremental; additional

Correct Answer
verified
The impact of one pe...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Trade allows countri...
View Answer

Correct Answer
verified
C

Correct Answer
verified