OLE MISS ECON 202 MIDTERM HAYES
QUESTIONS & ACCURATE PASSED
SOLUTIONS
opportunity cost - Correct Answer ✔✔ what you give up to obtain one item over the next
best alternative
other things equal - Correct Answer ✔✔ the assumption that factors other than those
being considered do not change
microeconomics - Correct Answer ✔✔ the study of how households and firms make
decision and how they interact in markets
macroeconomics - Correct Answer ✔✔ the study of economy-wide phenomena,
including inflation, unemployment, and economic growth
utility - Correct Answer ✔✔ in economics, this term is described as the pleasure,
happiness, or satisfaction received from a product // ability of a product to be used
demand curve - Correct Answer ✔✔ a graph of the relationship between the price of a
good and the quantity demanded
lower price increases the real incomes of buyers, enabling them to buy more - Correct
Answer ✔✔ One reason that the quantity demanded of a good increases when its price
falls is that the ___________________.
pleasure or satisfaction - Correct Answer ✔✔ For economists, the word "utility" means
benefit exceeds its marginal cost - Correct Answer ✔✔ A person should consume more
of something when its marginal ______________.
True - Correct Answer ✔✔ T/F: The production possibilities curve shows various
combinations of two products that an economy can produce when achieving full
employment.
True - Correct Answer ✔✔ T/F: Choices entail marginal costs because resources are
scarce.
scarcity and opportunity costs - Correct Answer ✔✔ In deciding whether to study for an
economics quiz or go to a concert, one is confronted by the idea(s) of ___________.
, budget line - Correct Answer ✔✔ A line that shows the different combinations of two
products a consumer can purchase with a specific money income, given the products'
prices
False - Correct Answer ✔✔ T/F: The study of economics is not useful for consumers,
because economic analysis focuses only on businesses and the economy.
right - Correct Answer ✔✔ An increase in immigration would shift the production
possibilities curve to the _______.
normative statements - Correct Answer ✔✔ claims that attempt to prescribe how the
world should be
other things equal - Correct Answer ✔✔ The Latin term "ceteris paribus" means
__________.
factors of production - Correct Answer ✔✔ economic resources are also called
___________.
production possibilities curve - Correct Answer ✔✔ illustrates scarcity
to produce more of one product, we must do with less of another - Correct Answer ✔✔
The negative slope of the production possibilities curve is a graphical way of indicating
what?
produce more of both consumer goods and capital goods by using resources that are
currently idle - Correct Answer ✔✔ If an economy is operating inside its production
possibilities curve for consumer goods and capital goods, it can
__________________________________.
competition - Correct Answer ✔✔ independently acting buyers and sellers and freedom
to enter or leave markets
price and quantity demand are inversely related - Correct Answer ✔✔ The law of
demand states that, other things equal, ________________________.
False - Correct Answer ✔✔ T/F: An increase in quantity supplied might be caused by an
increase in production costs.
True - Correct Answer ✔✔ T/F: A government tax per unit of output reduces supply.
True - Correct Answer ✔✔ T/F: An increase in consumer incomes will cause a decrease
in the demand for an inferior good.
QUESTIONS & ACCURATE PASSED
SOLUTIONS
opportunity cost - Correct Answer ✔✔ what you give up to obtain one item over the next
best alternative
other things equal - Correct Answer ✔✔ the assumption that factors other than those
being considered do not change
microeconomics - Correct Answer ✔✔ the study of how households and firms make
decision and how they interact in markets
macroeconomics - Correct Answer ✔✔ the study of economy-wide phenomena,
including inflation, unemployment, and economic growth
utility - Correct Answer ✔✔ in economics, this term is described as the pleasure,
happiness, or satisfaction received from a product // ability of a product to be used
demand curve - Correct Answer ✔✔ a graph of the relationship between the price of a
good and the quantity demanded
lower price increases the real incomes of buyers, enabling them to buy more - Correct
Answer ✔✔ One reason that the quantity demanded of a good increases when its price
falls is that the ___________________.
pleasure or satisfaction - Correct Answer ✔✔ For economists, the word "utility" means
benefit exceeds its marginal cost - Correct Answer ✔✔ A person should consume more
of something when its marginal ______________.
True - Correct Answer ✔✔ T/F: The production possibilities curve shows various
combinations of two products that an economy can produce when achieving full
employment.
True - Correct Answer ✔✔ T/F: Choices entail marginal costs because resources are
scarce.
scarcity and opportunity costs - Correct Answer ✔✔ In deciding whether to study for an
economics quiz or go to a concert, one is confronted by the idea(s) of ___________.
, budget line - Correct Answer ✔✔ A line that shows the different combinations of two
products a consumer can purchase with a specific money income, given the products'
prices
False - Correct Answer ✔✔ T/F: The study of economics is not useful for consumers,
because economic analysis focuses only on businesses and the economy.
right - Correct Answer ✔✔ An increase in immigration would shift the production
possibilities curve to the _______.
normative statements - Correct Answer ✔✔ claims that attempt to prescribe how the
world should be
other things equal - Correct Answer ✔✔ The Latin term "ceteris paribus" means
__________.
factors of production - Correct Answer ✔✔ economic resources are also called
___________.
production possibilities curve - Correct Answer ✔✔ illustrates scarcity
to produce more of one product, we must do with less of another - Correct Answer ✔✔
The negative slope of the production possibilities curve is a graphical way of indicating
what?
produce more of both consumer goods and capital goods by using resources that are
currently idle - Correct Answer ✔✔ If an economy is operating inside its production
possibilities curve for consumer goods and capital goods, it can
__________________________________.
competition - Correct Answer ✔✔ independently acting buyers and sellers and freedom
to enter or leave markets
price and quantity demand are inversely related - Correct Answer ✔✔ The law of
demand states that, other things equal, ________________________.
False - Correct Answer ✔✔ T/F: An increase in quantity supplied might be caused by an
increase in production costs.
True - Correct Answer ✔✔ T/F: A government tax per unit of output reduces supply.
True - Correct Answer ✔✔ T/F: An increase in consumer incomes will cause a decrease
in the demand for an inferior good.
