UHM ECON 130 Exam 1 Questions and Answers Solved Correctly Rated A+
In a market-oriented economy, the amount of a good that is produced is primarily decided by
the interaction of:
A. all consumers.
B. buyers and sellers.
C. producers and input suppliers.
D. producers and government planning
committees. - Answers B. buyers and sellers.
In the ____________, households work and receive payment from firms.
A. financial investment market
B. financial capital market
C. labor market
D. savings market - Answers C. labor market
In a command economy, the __________ either makes most economic decisions itself or at
least strongly influences how the decisions are made.
A. government
B. market
C. firm
D. business sector - Answers A. government
In the first chapter of The Wealth of Nations, Smith introduces the idea of the __________,
which means the way in which the work required to produce a good or service is divided into
a number of tasks that are performed by different workers.
A. division of labor
B. interconnected economy
C. task economy
,D. modern economy - Answers A. division of labor
The basic difference between macroeconomics and microeconomics is:
A. microeconomics concentrates on individual
markets while macroeconomics focuses
primarily on international trade.
B. microeconomics concentrates on the
behaviour of individual consumers while
macroeconomics focuses on the behaviour of
firms.
C. microeconomics concentrates on the
behaviour of individual consumers and firms
while macroeconomics focuses on the
performance of the entire economy.
D. microeconomics explores the causes of
inflation while macroeconomics focuses on
the causes of unemployment - Answers C. microeconomics concentrates on the
behaviour of individual consumers and firms while macroeconomics focuses on the performance of the
entire economy.
Scarcity exists because of:
A. the market mechanism.
B. specialization and division of labor.
C. the allocation of goods by prices
D. unlimited wants and limited resources - Answers D. unlimited wants and limited resources
Any given demand or supply curve is based on the ceteris paribus assumption that
___________________.
A. everything is variable.
, B. all else is held equal
C. no one knows which variables will change
and which will remain constant.
D. what is true for the individual is not
necessarily true for the whole. - Answers B. all else is held equal
In deciding how many hours to work, Beulah will make a choice that maximizes her _______;
that is, she will choose according to her preferences for leisure time and income.
A. budget constraint
B. opportunity set
C. utility
D. production possibilities frontier - Answers C. utility
Andy views beer and pizza as complements to one another. If the price of pizza decreases,
economists would expect:
A. Andy's demand for pizza to increase.
B. Andy's demand for pizza to decrease.
C. Andy's quantity of pizza demanded to
decrease.
D. Andy's demand for beer to increase. - Answers D. Andy's demand for beer to increase.
The nature of demand indicates that as the price of a good increases:
A. suppliers wish to sell less of it.
B. more of it is produced.
C. more of it is desired.
D. buyers desire to purchase less of it. - Answers D. buyers desire to purchase less of it.
when the price elasticity of demand is 0.89, we know that
A. the demand is very sensitive to the price
In a market-oriented economy, the amount of a good that is produced is primarily decided by
the interaction of:
A. all consumers.
B. buyers and sellers.
C. producers and input suppliers.
D. producers and government planning
committees. - Answers B. buyers and sellers.
In the ____________, households work and receive payment from firms.
A. financial investment market
B. financial capital market
C. labor market
D. savings market - Answers C. labor market
In a command economy, the __________ either makes most economic decisions itself or at
least strongly influences how the decisions are made.
A. government
B. market
C. firm
D. business sector - Answers A. government
In the first chapter of The Wealth of Nations, Smith introduces the idea of the __________,
which means the way in which the work required to produce a good or service is divided into
a number of tasks that are performed by different workers.
A. division of labor
B. interconnected economy
C. task economy
,D. modern economy - Answers A. division of labor
The basic difference between macroeconomics and microeconomics is:
A. microeconomics concentrates on individual
markets while macroeconomics focuses
primarily on international trade.
B. microeconomics concentrates on the
behaviour of individual consumers while
macroeconomics focuses on the behaviour of
firms.
C. microeconomics concentrates on the
behaviour of individual consumers and firms
while macroeconomics focuses on the
performance of the entire economy.
D. microeconomics explores the causes of
inflation while macroeconomics focuses on
the causes of unemployment - Answers C. microeconomics concentrates on the
behaviour of individual consumers and firms while macroeconomics focuses on the performance of the
entire economy.
Scarcity exists because of:
A. the market mechanism.
B. specialization and division of labor.
C. the allocation of goods by prices
D. unlimited wants and limited resources - Answers D. unlimited wants and limited resources
Any given demand or supply curve is based on the ceteris paribus assumption that
___________________.
A. everything is variable.
, B. all else is held equal
C. no one knows which variables will change
and which will remain constant.
D. what is true for the individual is not
necessarily true for the whole. - Answers B. all else is held equal
In deciding how many hours to work, Beulah will make a choice that maximizes her _______;
that is, she will choose according to her preferences for leisure time and income.
A. budget constraint
B. opportunity set
C. utility
D. production possibilities frontier - Answers C. utility
Andy views beer and pizza as complements to one another. If the price of pizza decreases,
economists would expect:
A. Andy's demand for pizza to increase.
B. Andy's demand for pizza to decrease.
C. Andy's quantity of pizza demanded to
decrease.
D. Andy's demand for beer to increase. - Answers D. Andy's demand for beer to increase.
The nature of demand indicates that as the price of a good increases:
A. suppliers wish to sell less of it.
B. more of it is produced.
C. more of it is desired.
D. buyers desire to purchase less of it. - Answers D. buyers desire to purchase less of it.
when the price elasticity of demand is 0.89, we know that
A. the demand is very sensitive to the price
