Econ Final Exam Practice Quiz Questions
With Complete Solutions
1.
Scarcity is
A.
Best measured in objective terms such as tons or kilowatt hours.
B.
A problem only in less-developed countries
C.
A matter of the relationship between resources and human wants
D.
Important for microeconomics, but not macroeconomics.
Correct Answer
,C. A matter of the relationship between resources and human wants
Explanation
Scarcity refers to the limited availability of resources compared to the unlimited wants and
needs of individuals and society. It is a concept that applies to all countries, regardless of their
level of development. Scarcity is not best measured in objective terms like tons or kilowatt
hours, as it is a qualitative concept that involves the relationship between resources and human
desires. Both microeconomics and macroeconomics study scarcity, as it is a fundamental
concept in understanding economic behavior and decision-making at both individual and
aggregate levels.
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2.
Karen spends $20 to hire a tutor to help her prepare for her economics final. This expense
should be considered part of
A.
The out-of-pocket cost of her college education
B.
The opportunity cost of her college education
C.
Both a and b
D.
,Neither a nor b
Correct Answer
C. Both a and b
Explanation
The expense of hiring a tutor to help Karen prepare for her economics final should be
considered part of both the out-of-pocket cost and the opportunity cost of her college
education. It is an out-of-pocket cost because Karen had to spend $20 directly from her own
pocket to pay for the tutor's services. Additionally, it is an opportunity cost because Karen had
to forego other potential uses of that $20, such as buying study materials or participating in
extracurricular activities. Therefore, the expense encompasses both the direct financial cost and
the alternative opportunities she had to give up.
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3.
The study of the factors determining the price of gasoline relative to the price of other fuels
would be primarily a concern of
A.
Macroeconomics
B.
Microeconomics
C.
Normative Economics
, D.
Forecasting
Correct Answer
B. Microeconomics
Explanation
The study of the factors determining the price of gasoline relative to the price of other fuels
would be primarily a concern of microeconomics because it focuses on the individual markets
and how supply and demand forces interact to determine prices. In this case, microeconomics
would analyze the specific factors that affect the price of gasoline, such as production costs,
consumer preferences, and competition among fuel providers. Macroeconomics, on the other
hand, looks at the overall economy and broader issues like inflation and unemployment.
Normative economics involves making value judgments about what the price of gasoline should
be, while forecasting is the process of predicting future economic trends.
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4.
Policies to control unemployment are primarily a concern of
A.
Macroeconomics
B.
Microeconomics
With Complete Solutions
1.
Scarcity is
A.
Best measured in objective terms such as tons or kilowatt hours.
B.
A problem only in less-developed countries
C.
A matter of the relationship between resources and human wants
D.
Important for microeconomics, but not macroeconomics.
Correct Answer
,C. A matter of the relationship between resources and human wants
Explanation
Scarcity refers to the limited availability of resources compared to the unlimited wants and
needs of individuals and society. It is a concept that applies to all countries, regardless of their
level of development. Scarcity is not best measured in objective terms like tons or kilowatt
hours, as it is a qualitative concept that involves the relationship between resources and human
desires. Both microeconomics and macroeconomics study scarcity, as it is a fundamental
concept in understanding economic behavior and decision-making at both individual and
aggregate levels.
Rate this question:
2.
Karen spends $20 to hire a tutor to help her prepare for her economics final. This expense
should be considered part of
A.
The out-of-pocket cost of her college education
B.
The opportunity cost of her college education
C.
Both a and b
D.
,Neither a nor b
Correct Answer
C. Both a and b
Explanation
The expense of hiring a tutor to help Karen prepare for her economics final should be
considered part of both the out-of-pocket cost and the opportunity cost of her college
education. It is an out-of-pocket cost because Karen had to spend $20 directly from her own
pocket to pay for the tutor's services. Additionally, it is an opportunity cost because Karen had
to forego other potential uses of that $20, such as buying study materials or participating in
extracurricular activities. Therefore, the expense encompasses both the direct financial cost and
the alternative opportunities she had to give up.
Rate this question:
3.
The study of the factors determining the price of gasoline relative to the price of other fuels
would be primarily a concern of
A.
Macroeconomics
B.
Microeconomics
C.
Normative Economics
, D.
Forecasting
Correct Answer
B. Microeconomics
Explanation
The study of the factors determining the price of gasoline relative to the price of other fuels
would be primarily a concern of microeconomics because it focuses on the individual markets
and how supply and demand forces interact to determine prices. In this case, microeconomics
would analyze the specific factors that affect the price of gasoline, such as production costs,
consumer preferences, and competition among fuel providers. Macroeconomics, on the other
hand, looks at the overall economy and broader issues like inflation and unemployment.
Normative economics involves making value judgments about what the price of gasoline should
be, while forecasting is the process of predicting future economic trends.
Rate this question:
4.
Policies to control unemployment are primarily a concern of
A.
Macroeconomics
B.
Microeconomics
