Principles of Microeconomics Exam
Verified Questions & Answers
Guaranteed A+ Score Solutions
Give an example of a statement about the idea that people are rational is correct? -
CORRECT ANSWER-The idea assumes that consumers and firms use all
available information as they act to achieve their goals.
Economists assume that the only reason people take the actions they do is in
response to economic incentives.
True or False? - CORRECT ANSWER-False
What do economists mean by the word "marginal"? - CORRECT ANSWER-extra
or additional
Economists believe that an activity should be continued up to the point where -
CORRECT ANSWER-the marginal benefit from the activity is equal to the
marginal cost.
, In a market system, how does society decide what goods and services will be
produced? - CORRECT ANSWER-Consumers, firms, and the government
determine what goods and services will be produced by the choices they make
In a market system, what determines how goods and services will be produced? -
CORRECT ANSWER-Firms determine how goods and services will be produced.
In a market system, how does society decide who will receive the goods and
services produced? - CORRECT ANSWER-Who receives the goods and services
produced depends largely on how income is distributed.
How are economic resources allocated in a market economy? - CORRECT
ANSWER-by the decisions of households and firms interacting in markets
Which of the following is a correct statement about a mixed economy? -
CORRECT ANSWER-In a mixed economy, most economic decisions are made in
markets but the government plays a significant role in the allocation of resources.
When does productive efficiency occur? - CORRECT ANSWER-Productive
efficiency occurs when a good or service is produced at the lowest possible cost.
When does allocative efficiency occur? - CORRECT ANSWER-Allocative
efficiency occurs when production is in accordance with consumer preferences
Why are models based on assumptions? - CORRECT ANSWER-Because models
have to be simplified to be useful.
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED
Verified Questions & Answers
Guaranteed A+ Score Solutions
Give an example of a statement about the idea that people are rational is correct? -
CORRECT ANSWER-The idea assumes that consumers and firms use all
available information as they act to achieve their goals.
Economists assume that the only reason people take the actions they do is in
response to economic incentives.
True or False? - CORRECT ANSWER-False
What do economists mean by the word "marginal"? - CORRECT ANSWER-extra
or additional
Economists believe that an activity should be continued up to the point where -
CORRECT ANSWER-the marginal benefit from the activity is equal to the
marginal cost.
, In a market system, how does society decide what goods and services will be
produced? - CORRECT ANSWER-Consumers, firms, and the government
determine what goods and services will be produced by the choices they make
In a market system, what determines how goods and services will be produced? -
CORRECT ANSWER-Firms determine how goods and services will be produced.
In a market system, how does society decide who will receive the goods and
services produced? - CORRECT ANSWER-Who receives the goods and services
produced depends largely on how income is distributed.
How are economic resources allocated in a market economy? - CORRECT
ANSWER-by the decisions of households and firms interacting in markets
Which of the following is a correct statement about a mixed economy? -
CORRECT ANSWER-In a mixed economy, most economic decisions are made in
markets but the government plays a significant role in the allocation of resources.
When does productive efficiency occur? - CORRECT ANSWER-Productive
efficiency occurs when a good or service is produced at the lowest possible cost.
When does allocative efficiency occur? - CORRECT ANSWER-Allocative
efficiency occurs when production is in accordance with consumer preferences
Why are models based on assumptions? - CORRECT ANSWER-Because models
have to be simplified to be useful.
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED
