C719 Macroeconomics
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1. According to the production possibilities They will steadily increase.
curve model, as you increase the production
of one good, what will happen to the sacri-
fices of the alternate good?
2. A farmer fully utilizes his resources to pro- Production possibilities
duce cauliflower and kale. As the farmer curve
produces more cauliflower, he has fewer re-
sources available to produce kale.
Which curve is illustrated in this scenario?
3. What are the main foci of economics? Consumption, production,
and use of scarce re-
sources
4. Study the two-sector circular-flow diagram. Households provide pro-
ductive resources to firms.
Classify each statement as either a flow of Flow of resources
resources or a flow of dollars.
Households buy consumer
Households provide productive resources to products from firms. Flow of
firms. dollars
Households buy consumer products from
firms. Firms sell products to
Firms sell products to households. households. Flow of dollars
Households supply labor to firms.
Households supply labor to
firms. Flow of resources
5. Florence could earn an annual salary of $35,000
$70,000 as a financial advisor or $60,000
as a bank manager. Currently, Florence is
a teacher and earns an annual salary of
$35,000.
What is Florence's opportunity cost for
choosing to be a teacher instead of a finan-
cial advisor?
, C719 Macroeconomics
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6. Florence is a teacher and earns $35,000 a Florence should stay home,
year. Her spouse is a part-time IT specialist since she has a lower op-
who earns $45,000 a year. Florence and her portunity cost.
spouse decide that one of them should quit
work and become a stay-at-home parent.
Based on the principle of comparative
advantage, who should be the full-time,
stay-at-home parent?
7. Referring to the three economic questions The buyers and sellers
(what, how, and for whom), in a market sys-
tem, by whom are these questions deter-
mined?
8. In the car manufacturing industry, the supply There will be a movement
for cars has a positive slope. along the supply curve.
What happens if the price of cars increases?
9. In the car manufacturing industry, the supply A change in the cost of la-
for cars has a positive slope. bor
A change in expectations
Which two factors can cause the supply about the future
curve to shift?
Choose 2 answers
10. Textbooks and class enrollments are com- It will shift to the left.
plements.
What happens to the demand curve for text-
books if the tuition rate increases?
11. Below are likely scenarios that affect the de- The unemployment rate in-
mand curve for automobiles. creases to 15% in the state
of Michigan due to a re-
Which scenario is correct? cession. As a result, people
will have less income and
, C719 Macroeconomics
Study online at https://quizlet.com/_dmhfdr
will be spending less. This
will decrease the demand
for automobiles, and the de-
mand curve for automobiles
will shift to the left.
12. Classify each option as either increasing or Equilibrium price for the cur-
decreasing if the price of tablets is expected rent month decrease
to go down. Current demand for tablets
decrease
Answer options may be used more than once Future demand for tablets
or not at all. Select your answers from the increase
pull-down list.
Equilibrium price for the current month
Current demand for tablets
Future demand for tablets
13. A drought in Columbia destroyed the rice The supply curve for rice
crops, which caused the supply of rice to will shift leftward. This will
decrease. cause an increase in the
equilibrium price and a de-
Which scenario will occur as a result of the crease in the equilibrium
decrease in supply? quantity.
14. The maximum number of skilled and un- Full employment
skilled workers are employed in an economy.
What type of employment is this?
15. In January, Harry was laid off from his job, Discouraged worker
and he immediately began seeking employ-
ment. In May, he stopped looking for a job.
It is now July, and he is still receiving unem-
ployment benefits.
How would you classify Harry's employment
status?
16. 1,900,000
Study online at https://quizlet.com/_dmhfdr
1. According to the production possibilities They will steadily increase.
curve model, as you increase the production
of one good, what will happen to the sacri-
fices of the alternate good?
2. A farmer fully utilizes his resources to pro- Production possibilities
duce cauliflower and kale. As the farmer curve
produces more cauliflower, he has fewer re-
sources available to produce kale.
Which curve is illustrated in this scenario?
3. What are the main foci of economics? Consumption, production,
and use of scarce re-
sources
4. Study the two-sector circular-flow diagram. Households provide pro-
ductive resources to firms.
Classify each statement as either a flow of Flow of resources
resources or a flow of dollars.
Households buy consumer
Households provide productive resources to products from firms. Flow of
firms. dollars
Households buy consumer products from
firms. Firms sell products to
Firms sell products to households. households. Flow of dollars
Households supply labor to firms.
Households supply labor to
firms. Flow of resources
5. Florence could earn an annual salary of $35,000
$70,000 as a financial advisor or $60,000
as a bank manager. Currently, Florence is
a teacher and earns an annual salary of
$35,000.
What is Florence's opportunity cost for
choosing to be a teacher instead of a finan-
cial advisor?
, C719 Macroeconomics
Study online at https://quizlet.com/_dmhfdr
6. Florence is a teacher and earns $35,000 a Florence should stay home,
year. Her spouse is a part-time IT specialist since she has a lower op-
who earns $45,000 a year. Florence and her portunity cost.
spouse decide that one of them should quit
work and become a stay-at-home parent.
Based on the principle of comparative
advantage, who should be the full-time,
stay-at-home parent?
7. Referring to the three economic questions The buyers and sellers
(what, how, and for whom), in a market sys-
tem, by whom are these questions deter-
mined?
8. In the car manufacturing industry, the supply There will be a movement
for cars has a positive slope. along the supply curve.
What happens if the price of cars increases?
9. In the car manufacturing industry, the supply A change in the cost of la-
for cars has a positive slope. bor
A change in expectations
Which two factors can cause the supply about the future
curve to shift?
Choose 2 answers
10. Textbooks and class enrollments are com- It will shift to the left.
plements.
What happens to the demand curve for text-
books if the tuition rate increases?
11. Below are likely scenarios that affect the de- The unemployment rate in-
mand curve for automobiles. creases to 15% in the state
of Michigan due to a re-
Which scenario is correct? cession. As a result, people
will have less income and
, C719 Macroeconomics
Study online at https://quizlet.com/_dmhfdr
will be spending less. This
will decrease the demand
for automobiles, and the de-
mand curve for automobiles
will shift to the left.
12. Classify each option as either increasing or Equilibrium price for the cur-
decreasing if the price of tablets is expected rent month decrease
to go down. Current demand for tablets
decrease
Answer options may be used more than once Future demand for tablets
or not at all. Select your answers from the increase
pull-down list.
Equilibrium price for the current month
Current demand for tablets
Future demand for tablets
13. A drought in Columbia destroyed the rice The supply curve for rice
crops, which caused the supply of rice to will shift leftward. This will
decrease. cause an increase in the
equilibrium price and a de-
Which scenario will occur as a result of the crease in the equilibrium
decrease in supply? quantity.
14. The maximum number of skilled and un- Full employment
skilled workers are employed in an economy.
What type of employment is this?
15. In January, Harry was laid off from his job, Discouraged worker
and he immediately began seeking employ-
ment. In May, he stopped looking for a job.
It is now July, and he is still receiving unem-
ployment benefits.
How would you classify Harry's employment
status?
16. 1,900,000
