Principles of Microeconomics Exam
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The sacrifice of an alternative is called: - Answer- Opportunity cost
Microeconomics deals with: - Answer- individual units in the economy.
In economics, the function of theories, laws, and hypotheses is to: - Answer- discover
relationships between events that are important to economic behavior.
A feature that distinguishes economists' approach to making choices is (are): - Answer-
1. Assuming individuals make choices to maximize objectives.
2. Assigning opportunity costs a major role in their analyses of choices.
3. Emphasizing that choices are made at the margin.
Suppose you observe that the sun sets every evening after the six o'clock business
report. If you conclude that the six o'clock business report makes the sun set, you are
guilty of the fallacy of: - Answer- False cause.
Whenever a choice is made: - Answer- The cost of that choice could be referred to as
opportunity cost.
The primary emphasis in macroeconomics is on: - Answer- aggregates in the economy.
An answer to the question "How are goods produced?" determines: - Answer- how
resources are combined in the production of goods.
Water is considered a scarce good rather than a free good because: - Answer- it has
alternative uses.
Making choices that are expected to achieve the highest possible value for some
objective is termed: - Answer- maximizing.
Positive statements are: - Answer- statements that can be tested.
An answer to the question "For whom" determines: - Answer- who gets the goods and
services produced
A simplified representation of a particular problem is a: - Answer- model.
A key theme fundamental to all of economics is: - Answer- people have unlimited wants
facing limited means to satisfy them
,Ceteris paribus means: - Answer- all other things unchanged.
The concept of scarcity indicates that: - Answer- almost all goods have alternative uses.
Most economists' disagreements are a result of: - Answer- normative considerations
The current rate of unemployment of 5 percent is too high. This is a _______ statement.
- Answer- normative
Economists are: - Answer- not always in agreement on the best way to implement policy
decisions.
Economics is a: - Answer- Social science that deals with making choices among
alternatives
Which of the following would be a part of macroeconomics? A study of: - Answer-
inflation
The Case in Point on the Simpsons indicated that even fictional characters face: -
Answer- opportunity costs
The problem of determining what goods and services society should produce: - Answer-
exists because there are not enough resources to provide all the goods and services
that people want to purchase.
The study of a single firm and how it determines prices would fall under: - Answer-
microeconomics
Scarcity in economics means: - Answer- not having sufficient resources to produce all
the goods and services we want
Specialization arises because: - Answer- differences in the costs of production give
some producers a comparative advantage in the production of particular goods or
services.
Efficient production implies that it is: - Answer- not possible to produce more of one
good without producing less of another good.
A factor of production that is produced in order to produce something else is called: -
Answer- capital
Countries import some goods and export other goods primarily because of: - Answer-
comparative advantage
, A movement along the production possibilities curve would be a result of: - Answer-
changes in the combinations of the two goods produced.
Factors of production are: - Answer- the resources the economy has available to
produce goods and services.
If countries do not engage in international trade: - Answer- D. All the above are true -
They give up the ability to specialize in production, worldwide levels of production are
lower & the world will be operating inside its production possibilities curve.
One reason you go to college is to improve your employment opportunities and obtain a
higher income in the future. In the context of production possibilities, this is most
comparable to: - Answer- producing relatively more capital goods and relatively fewer
consumer goods.
Increases in resources or improvements in technology will tend to cause a society's
production possibilities curve to: - Answer- shift outward to the right
An example of a natural resource is: - Answer- oil in the ground.
Human capital is: - Answer- the set of acquired skills and abilities that workers bring to
the production of goods and services.
Any factor of production is capital if it: - Answer- was produced and can be used to
produce other goods and services..
In the market capitalist economy: - Answer- individual ownership and decision making
are relied upon
The law of increasing opportunity cost means that: - Answer- opportunity cost increases
when you produce more of one good while moving along a production possibilities
curve.
In a command socialist economy: - Answer- resources are government owned and
government exercises broad power over their use.
Improvements in technology provide benefits to: - Answer- consumers, through lower
prices, workers, although some jobs may be eliminated, and firms, through lower
production costs.
The exhibit shows production possibilities curves for two countries that produce only
radishes and bicycles. The axes of both graphs are measured in equivalent units.
Country A is now operating at point M, and Country B is now operating at point N.
Suppose Country B wants to be able to produce more radishes and more bicycles. To
do this, it must: - Answer- acquire more capital, more labor, more natural resources,
and/or better technology
Questions & Answers Latest Updated
Rated A+
The sacrifice of an alternative is called: - Answer- Opportunity cost
Microeconomics deals with: - Answer- individual units in the economy.
In economics, the function of theories, laws, and hypotheses is to: - Answer- discover
relationships between events that are important to economic behavior.
A feature that distinguishes economists' approach to making choices is (are): - Answer-
1. Assuming individuals make choices to maximize objectives.
2. Assigning opportunity costs a major role in their analyses of choices.
3. Emphasizing that choices are made at the margin.
Suppose you observe that the sun sets every evening after the six o'clock business
report. If you conclude that the six o'clock business report makes the sun set, you are
guilty of the fallacy of: - Answer- False cause.
Whenever a choice is made: - Answer- The cost of that choice could be referred to as
opportunity cost.
The primary emphasis in macroeconomics is on: - Answer- aggregates in the economy.
An answer to the question "How are goods produced?" determines: - Answer- how
resources are combined in the production of goods.
Water is considered a scarce good rather than a free good because: - Answer- it has
alternative uses.
Making choices that are expected to achieve the highest possible value for some
objective is termed: - Answer- maximizing.
Positive statements are: - Answer- statements that can be tested.
An answer to the question "For whom" determines: - Answer- who gets the goods and
services produced
A simplified representation of a particular problem is a: - Answer- model.
A key theme fundamental to all of economics is: - Answer- people have unlimited wants
facing limited means to satisfy them
,Ceteris paribus means: - Answer- all other things unchanged.
The concept of scarcity indicates that: - Answer- almost all goods have alternative uses.
Most economists' disagreements are a result of: - Answer- normative considerations
The current rate of unemployment of 5 percent is too high. This is a _______ statement.
- Answer- normative
Economists are: - Answer- not always in agreement on the best way to implement policy
decisions.
Economics is a: - Answer- Social science that deals with making choices among
alternatives
Which of the following would be a part of macroeconomics? A study of: - Answer-
inflation
The Case in Point on the Simpsons indicated that even fictional characters face: -
Answer- opportunity costs
The problem of determining what goods and services society should produce: - Answer-
exists because there are not enough resources to provide all the goods and services
that people want to purchase.
The study of a single firm and how it determines prices would fall under: - Answer-
microeconomics
Scarcity in economics means: - Answer- not having sufficient resources to produce all
the goods and services we want
Specialization arises because: - Answer- differences in the costs of production give
some producers a comparative advantage in the production of particular goods or
services.
Efficient production implies that it is: - Answer- not possible to produce more of one
good without producing less of another good.
A factor of production that is produced in order to produce something else is called: -
Answer- capital
Countries import some goods and export other goods primarily because of: - Answer-
comparative advantage
, A movement along the production possibilities curve would be a result of: - Answer-
changes in the combinations of the two goods produced.
Factors of production are: - Answer- the resources the economy has available to
produce goods and services.
If countries do not engage in international trade: - Answer- D. All the above are true -
They give up the ability to specialize in production, worldwide levels of production are
lower & the world will be operating inside its production possibilities curve.
One reason you go to college is to improve your employment opportunities and obtain a
higher income in the future. In the context of production possibilities, this is most
comparable to: - Answer- producing relatively more capital goods and relatively fewer
consumer goods.
Increases in resources or improvements in technology will tend to cause a society's
production possibilities curve to: - Answer- shift outward to the right
An example of a natural resource is: - Answer- oil in the ground.
Human capital is: - Answer- the set of acquired skills and abilities that workers bring to
the production of goods and services.
Any factor of production is capital if it: - Answer- was produced and can be used to
produce other goods and services..
In the market capitalist economy: - Answer- individual ownership and decision making
are relied upon
The law of increasing opportunity cost means that: - Answer- opportunity cost increases
when you produce more of one good while moving along a production possibilities
curve.
In a command socialist economy: - Answer- resources are government owned and
government exercises broad power over their use.
Improvements in technology provide benefits to: - Answer- consumers, through lower
prices, workers, although some jobs may be eliminated, and firms, through lower
production costs.
The exhibit shows production possibilities curves for two countries that produce only
radishes and bicycles. The axes of both graphs are measured in equivalent units.
Country A is now operating at point M, and Country B is now operating at point N.
Suppose Country B wants to be able to produce more radishes and more bicycles. To
do this, it must: - Answer- acquire more capital, more labor, more natural resources,
and/or better technology
