ECO PBSC Midterm New Exam With Questions And
Correct Answers 100% Verified
If the federal government creates environmental policies that make it cheaper for firms
to adhere to green policies, then the policies are congruent with economic incentives.
The pie chart to the right depicts hypothetical data for the market share for the United
States automobile market. The percentage of the U.S. market that U.S. auto firms
control is 65%
Trade-offs force society to make choices, especially when answering the following three
fundamental questions: - ANSWER One, what goods and services will be produced?
Two, how will the goods and services be produced? Three, who will receive the goods
and services produced?
Best Goods, one of the leading department store chains, sells goods at inexpensive
prices. It has been opening many new stores throughout the country in recent times.
After establishing stores in most major cities, Best Goods began facing considerable
resistance in the city of Joberg from lobbyists of smaller general stores-that is, local
businesses-opposing its entry. The lobbyists mentioned various reasons for their
opposition, one being that Best Goods would run many local stores out of business and
also contribute to increasing income inequality and unemployment in the city.
Which of the following, if true, would weaken the stand of the lobbyists? - ANSWER It is
common for traditional retailers to modernize and successfully compete with organized
retailing.
Terbia is a closed economy. It has been growing at a very slow pace over the last
decade. This year, the government of Terbia removed its trade barriers and also
increased its spending on the economy in an attempt to spur economic growth. These
actions were expected to generate jobs and enhance economic growth. However,
unemployment did not decline as expected.
,Which of the following, if true, can explain this outcome? - ANSWER Imported varieties
of many goods were cheaper than the domestically produced varieties.
Microeconomics is the study of - ANSWER how households and firms make choices, how
they interact in markets, and how the government attempts to influence their choices.
Microsoft charges a price of $599 for a copy of Windows 7. Is this pricing decision
rational? - ANSWER We assume rationality when we assume that the managers at
Microsoft have utilized all available information and weighed up all known benefits and
costs.
Economics is a social science because - ANSWER all of the above.
When we graph the relationship between two variables, we often want to draw
conclusions about whether changes in one variable are causing changes in the other
variable. Doing so, however, can lead to incorrect conclusions. Reasons for drawing
incorrect conclusions about cause and effect include - ANSWER an omitted variable and
reverse causality
Equity is - ANSWER the fair distribution of economic benefits.
Markets involve two important groups of participants. A _____ is composed of everyone
in a household. _____ are providers of goods and services.
We can use a simplified economic model, the _____, to view the way the participants in
markets are connected - ANSWER Household
Firms
circular-flow diagram
In diagram to the right, point
Upper C
, shows an - ANSWER Efficient outcome
Using the same amount of resources, the United States and Canada can both produce
lumberjack shirts and lumberjack boots, as shown in the production possibilities
frontiers in the figure to the right.
_____ has a comparative advantage in producing lumberjack boots.
_____ has a comparative advantage in producing lumberjack shirts
Does either country have an absolute advantage in producing both goods?
Suppose initially that the United States is consuming
2 boots and 12 shirts and Canada is consuming 8 boots and 4
shirts, as suggested in the figure. Then suppose the United States and Canada
specialize by each only producing the good for which they have a comparative
advantage and then trade. In particular, suppose the United States trades Canada half
of its production for half of what Canada produces.
The United States will have _____ additional shirt(s) after the trade (enter a numeric
response using an i - ANSWER Canada
The United States
Neither country has an absolute advantage in both goods because
Canada can produce more boots but
the United States
can produce more shirts.
Correct Answers 100% Verified
If the federal government creates environmental policies that make it cheaper for firms
to adhere to green policies, then the policies are congruent with economic incentives.
The pie chart to the right depicts hypothetical data for the market share for the United
States automobile market. The percentage of the U.S. market that U.S. auto firms
control is 65%
Trade-offs force society to make choices, especially when answering the following three
fundamental questions: - ANSWER One, what goods and services will be produced?
Two, how will the goods and services be produced? Three, who will receive the goods
and services produced?
Best Goods, one of the leading department store chains, sells goods at inexpensive
prices. It has been opening many new stores throughout the country in recent times.
After establishing stores in most major cities, Best Goods began facing considerable
resistance in the city of Joberg from lobbyists of smaller general stores-that is, local
businesses-opposing its entry. The lobbyists mentioned various reasons for their
opposition, one being that Best Goods would run many local stores out of business and
also contribute to increasing income inequality and unemployment in the city.
Which of the following, if true, would weaken the stand of the lobbyists? - ANSWER It is
common for traditional retailers to modernize and successfully compete with organized
retailing.
Terbia is a closed economy. It has been growing at a very slow pace over the last
decade. This year, the government of Terbia removed its trade barriers and also
increased its spending on the economy in an attempt to spur economic growth. These
actions were expected to generate jobs and enhance economic growth. However,
unemployment did not decline as expected.
,Which of the following, if true, can explain this outcome? - ANSWER Imported varieties
of many goods were cheaper than the domestically produced varieties.
Microeconomics is the study of - ANSWER how households and firms make choices, how
they interact in markets, and how the government attempts to influence their choices.
Microsoft charges a price of $599 for a copy of Windows 7. Is this pricing decision
rational? - ANSWER We assume rationality when we assume that the managers at
Microsoft have utilized all available information and weighed up all known benefits and
costs.
Economics is a social science because - ANSWER all of the above.
When we graph the relationship between two variables, we often want to draw
conclusions about whether changes in one variable are causing changes in the other
variable. Doing so, however, can lead to incorrect conclusions. Reasons for drawing
incorrect conclusions about cause and effect include - ANSWER an omitted variable and
reverse causality
Equity is - ANSWER the fair distribution of economic benefits.
Markets involve two important groups of participants. A _____ is composed of everyone
in a household. _____ are providers of goods and services.
We can use a simplified economic model, the _____, to view the way the participants in
markets are connected - ANSWER Household
Firms
circular-flow diagram
In diagram to the right, point
Upper C
, shows an - ANSWER Efficient outcome
Using the same amount of resources, the United States and Canada can both produce
lumberjack shirts and lumberjack boots, as shown in the production possibilities
frontiers in the figure to the right.
_____ has a comparative advantage in producing lumberjack boots.
_____ has a comparative advantage in producing lumberjack shirts
Does either country have an absolute advantage in producing both goods?
Suppose initially that the United States is consuming
2 boots and 12 shirts and Canada is consuming 8 boots and 4
shirts, as suggested in the figure. Then suppose the United States and Canada
specialize by each only producing the good for which they have a comparative
advantage and then trade. In particular, suppose the United States trades Canada half
of its production for half of what Canada produces.
The United States will have _____ additional shirt(s) after the trade (enter a numeric
response using an i - ANSWER Canada
The United States
Neither country has an absolute advantage in both goods because
Canada can produce more boots but
the United States
can produce more shirts.
