ECON 1100 EXAM 180 QUESTIONS & CORRECT
ANSWERS LATEST 2025
Scarcity exists because:
a. it is impossible to increase the quantity of available resources.
b. it is impossible to increase the productivity of available resources.
c. currently available resources are not sufficient to produce everything people
want and need.
d. currently available resources are sufficient to produce everything people want
and need. - ANSWER-currently available resources are not sufficient to produce
everything people want and need.
"The government should raise the minimum wage" is an example of a:
a. factual statement.
b. ceteris paribus statement.
c. positive statement.
d.normative statement. - ANSWER-normative statement.
Which of the following would most likely be studied in a microeconomics course?
a. The relationship between national output and the rate of unemployment
b. The strategy used by the owners of a competitive firm to maximize profits
c. The relationship between the national money supply and the price level
d. The strategy used by the Federal Reserve, the nation's central bank, to lower
interest rates - ANSWER-The strategy used by the owners of a competitive firm to
maximize profits
,Incorrectly concluding that because tax reform measures benefit some individuals,
the
measures are also beneficial for the economy as a whole is an example of the:
a. post hoc fallacy (association-causation issue).
b. fallacy of division.
c. fallacy of false cause.
d. fallacy of composition. - ANSWER-fallacy of composition.
Which of the following is not an example of the factor of production or economic
resource referred to as capital?
a. An office building
b. Computers used by a tax preparation business
c. Lawn mowers owned by a landscaping firm
d.Money used to start a new business - ANSWER-Money used to start a new
business
The opportunity cost of attending school is:
a. the same for all people.
b. highest for people who gave up good jobs to attend school.
c. highest for people who continue to work while attending school.
d. equal to the tuition charged by each school. - ANSWER-highest for people who
gave up good jobs to attend school.
A command economy is characterized by:
a. decentralized decisions about how to allocate resources.
b. government ownership or control of most resources.
, c. voluntary exchange and incentives to exchange.
d. efficient allocation of scarce resources. - ANSWER-government ownership or
control of most resources.
The business sector sells goods and services in the product market in order to
generate
_____, which then creates _____ for the household sector.
a. costs; revenue
b. revenue; income
c. profit; costs
d. costs; profit - ANSWER-revenue; income
A country experiences a trade deficit when:
a. the value of exports exceeds the value of imports.
b. some of the goods and services produced in the business sector are exported.
c. the value of imports exceeds the value of exports.
d. some of the goods and services purchased by the household sector are imported.
- ANSWER-the value of imports exceeds the value of exports.
A rightward shift of a production possibilities frontier (curve) indicates that:
a. economic activity is declining.
b. economic growth has occurred.
c. opportunity costs are decreasing.
d. opportunity costs are constant. - ANSWER-economic growth has occurred.
Protectionist policies are designed to:
ANSWERS LATEST 2025
Scarcity exists because:
a. it is impossible to increase the quantity of available resources.
b. it is impossible to increase the productivity of available resources.
c. currently available resources are not sufficient to produce everything people
want and need.
d. currently available resources are sufficient to produce everything people want
and need. - ANSWER-currently available resources are not sufficient to produce
everything people want and need.
"The government should raise the minimum wage" is an example of a:
a. factual statement.
b. ceteris paribus statement.
c. positive statement.
d.normative statement. - ANSWER-normative statement.
Which of the following would most likely be studied in a microeconomics course?
a. The relationship between national output and the rate of unemployment
b. The strategy used by the owners of a competitive firm to maximize profits
c. The relationship between the national money supply and the price level
d. The strategy used by the Federal Reserve, the nation's central bank, to lower
interest rates - ANSWER-The strategy used by the owners of a competitive firm to
maximize profits
,Incorrectly concluding that because tax reform measures benefit some individuals,
the
measures are also beneficial for the economy as a whole is an example of the:
a. post hoc fallacy (association-causation issue).
b. fallacy of division.
c. fallacy of false cause.
d. fallacy of composition. - ANSWER-fallacy of composition.
Which of the following is not an example of the factor of production or economic
resource referred to as capital?
a. An office building
b. Computers used by a tax preparation business
c. Lawn mowers owned by a landscaping firm
d.Money used to start a new business - ANSWER-Money used to start a new
business
The opportunity cost of attending school is:
a. the same for all people.
b. highest for people who gave up good jobs to attend school.
c. highest for people who continue to work while attending school.
d. equal to the tuition charged by each school. - ANSWER-highest for people who
gave up good jobs to attend school.
A command economy is characterized by:
a. decentralized decisions about how to allocate resources.
b. government ownership or control of most resources.
, c. voluntary exchange and incentives to exchange.
d. efficient allocation of scarce resources. - ANSWER-government ownership or
control of most resources.
The business sector sells goods and services in the product market in order to
generate
_____, which then creates _____ for the household sector.
a. costs; revenue
b. revenue; income
c. profit; costs
d. costs; profit - ANSWER-revenue; income
A country experiences a trade deficit when:
a. the value of exports exceeds the value of imports.
b. some of the goods and services produced in the business sector are exported.
c. the value of imports exceeds the value of exports.
d. some of the goods and services purchased by the household sector are imported.
- ANSWER-the value of imports exceeds the value of exports.
A rightward shift of a production possibilities frontier (curve) indicates that:
a. economic activity is declining.
b. economic growth has occurred.
c. opportunity costs are decreasing.
d. opportunity costs are constant. - ANSWER-economic growth has occurred.
Protectionist policies are designed to:
