ECO 201 Chapters 1,2,3,6,7,8,9,16,20
Questions and Answers 100% Pass
Macroeconomics primarily examines:
Start of Chapter 1 - ✔✔broad issues such as national output, employment and inflation.
In which of the following countries will the national government have the greatest
influence with respect to the nation's economy? - ✔✔Cuba
The two main tools of macroeconomic policy are monetary policy and fiscal policy.
Fiscal policy involves __________ spending. - ✔✔government
Because of their relatively small national economies, which of the following is most
likely considered to be the most important factor for Belgium, Korea, and Canada to
take full advantage of specialization? - ✔✔international trade
Which of the following is generally accepted as a valid criticism of the production of
useful goods and services? - ✔✔environmental pollution
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,_____________ - a term referring to the fact that for many goods, as the level of
production increases, the average cost of producing each individual unit declines. -
✔✔Economies of scale
In a market-oriented economy, the amount of a good that is produced is primarily
decided by the interaction of: - ✔✔buyers and sellers.
Which of the following statements most likely lies within the realm of macroeconomics?
- ✔✔Due to an economic recession, manufacturing firms began implementing layoffs of
their workforces.
Which of the following best characterizes the circular flow of income? - ✔✔Businesses
buy resources from households, and households use their income from the sale of
resources to buy goods and services from businesses.
In a command economy, the __________ either makes most economic decisions itself or
at least strongly influences how the decisions are made. - ✔✔government
Which of the following is most likely a topic of discussion in macroeconomics? - ✔✔a
decrease in the unemployment rate
The basic difference between macroeconomics and microeconomics is: -
✔✔microeconomics concentrates on the behaviour of individual consumers and firms
while macroeconomics focuses on the performance of the entire economy.
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 2
,The circular flow diagram of economic activity is a model of the: - ✔✔flow of goods,
services, and payments between households and firms.
Economic models like the _____________________ are not physical models, but instead
are diagrams or graphs or even mathematical equations that represent economic
patterns or theories. - ✔✔circular flow diagram
In a _______________________, most economic decisions about what to produce, how to
produce it, and for whom to produce it are made by buyers and sellers. - ✔✔market-
oriented economy
In countries like _____________ the command economy predominates. - ✔✔Cuba and
North Korea
The basic difference between macroeconomics and microeconomics is that: -
✔✔microeconomics is concerned with the trees (individual markets) while
macroeconomics is concerned with the forest (aggregate markets).
In the ____________, households work and receive payment from firms. - ✔✔labor
market
Choose all correct answers in the question below:
In the circular flow diagram model: - ✔✔households receive income from businesses in
exchange for providing inputs and use that income to buy goods and services from
businesses.
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 3
, businesses receive revenues from households in exchange for providing goods and
services and use those revenues to buy inputs from households.
Which of the following best describes a fiscal policy tool?
End of chapter 1 - ✔✔government spending
Scarcity implies that:
Start of Chapter 2 - ✔✔it is impossible to completely fulfill the unlimited human desire
for goods and services with the limited resources available.
As depicted in _______________, it is necessary to give up some of one good to gain
more of the other good. - ✔✔the production possibilities frontier
"If I didn't have class tonight, I would save the $4 campus parking fee and spend four
hours at work where I earn $10 per hour." The opportunity cost of attending class this
evening is: - ✔✔$44
The model that economists use for illustrating the process of individual choice in a
situation of scarcity is the budget constraint, sometimes also called the
_______________, a diagram which shows what choices are possible. - ✔✔opportunity
set
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 4
Questions and Answers 100% Pass
Macroeconomics primarily examines:
Start of Chapter 1 - ✔✔broad issues such as national output, employment and inflation.
In which of the following countries will the national government have the greatest
influence with respect to the nation's economy? - ✔✔Cuba
The two main tools of macroeconomic policy are monetary policy and fiscal policy.
Fiscal policy involves __________ spending. - ✔✔government
Because of their relatively small national economies, which of the following is most
likely considered to be the most important factor for Belgium, Korea, and Canada to
take full advantage of specialization? - ✔✔international trade
Which of the following is generally accepted as a valid criticism of the production of
useful goods and services? - ✔✔environmental pollution
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 1
,_____________ - a term referring to the fact that for many goods, as the level of
production increases, the average cost of producing each individual unit declines. -
✔✔Economies of scale
In a market-oriented economy, the amount of a good that is produced is primarily
decided by the interaction of: - ✔✔buyers and sellers.
Which of the following statements most likely lies within the realm of macroeconomics?
- ✔✔Due to an economic recession, manufacturing firms began implementing layoffs of
their workforces.
Which of the following best characterizes the circular flow of income? - ✔✔Businesses
buy resources from households, and households use their income from the sale of
resources to buy goods and services from businesses.
In a command economy, the __________ either makes most economic decisions itself or
at least strongly influences how the decisions are made. - ✔✔government
Which of the following is most likely a topic of discussion in macroeconomics? - ✔✔a
decrease in the unemployment rate
The basic difference between macroeconomics and microeconomics is: -
✔✔microeconomics concentrates on the behaviour of individual consumers and firms
while macroeconomics focuses on the performance of the entire economy.
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 2
,The circular flow diagram of economic activity is a model of the: - ✔✔flow of goods,
services, and payments between households and firms.
Economic models like the _____________________ are not physical models, but instead
are diagrams or graphs or even mathematical equations that represent economic
patterns or theories. - ✔✔circular flow diagram
In a _______________________, most economic decisions about what to produce, how to
produce it, and for whom to produce it are made by buyers and sellers. - ✔✔market-
oriented economy
In countries like _____________ the command economy predominates. - ✔✔Cuba and
North Korea
The basic difference between macroeconomics and microeconomics is that: -
✔✔microeconomics is concerned with the trees (individual markets) while
macroeconomics is concerned with the forest (aggregate markets).
In the ____________, households work and receive payment from firms. - ✔✔labor
market
Choose all correct answers in the question below:
In the circular flow diagram model: - ✔✔households receive income from businesses in
exchange for providing inputs and use that income to buy goods and services from
businesses.
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 3
, businesses receive revenues from households in exchange for providing goods and
services and use those revenues to buy inputs from households.
Which of the following best describes a fiscal policy tool?
End of chapter 1 - ✔✔government spending
Scarcity implies that:
Start of Chapter 2 - ✔✔it is impossible to completely fulfill the unlimited human desire
for goods and services with the limited resources available.
As depicted in _______________, it is necessary to give up some of one good to gain
more of the other good. - ✔✔the production possibilities frontier
"If I didn't have class tonight, I would save the $4 campus parking fee and spend four
hours at work where I earn $10 per hour." The opportunity cost of attending class this
evening is: - ✔✔$44
The model that economists use for illustrating the process of individual choice in a
situation of scarcity is the budget constraint, sometimes also called the
_______________, a diagram which shows what choices are possible. - ✔✔opportunity
set
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 4
