Question 1

In the early 1980s, U.S. economic policy was directed toward reducing inflation. What would you have expected to observe during this short period of time?

Accepted Answer

A)   Inflation fell and unemployment fell.
B)   Inflation and unemployment were both unaffected.
C)   Inflation fell and unemployment increased.
D)   Inflation fell and unemployment was unchanged.E) All of the above
F) A) and D)

Question 2

Economics is the study of how society manages its

Accepted Answer

A)   limited wants and unlimited resources.
B)   unlimited wants and unlimited resources.
C)   limited wants and limited resources.
D)   unlimited wants and limited resources.E) B) and C)
F) None of the above

Question 3

Which of the following can policy do?

Accepted Answer

A)   alter incentives
B)   alter trade-offs
C)   change opportunity costs
D)   All of the above are correct.E) All of the above
F) A) and D)

Question 4

Government policies resulting in reduced efficiency include

Accepted Answer

A)   (i)  only
B)   (ii)  only
C)   (i)  and (ii)  only
D)   (i) , (ii) , and (iii) E) A) and B)
F) B) and C)

Question 5

One effect of the government-imposed seat belt law in the U.S. has been

Accepted Answer

A)   a dramatic decrease in the number of pedestrian deaths.
B)   safer driving.
C)   an increase in the number of accidents.
D)   a dramatic decrease in the number of driver deaths.E) All of the above
F) B) and C)

Question 6

The broken window fallacy states that when a window breaks and someone spends money to repair it, they have created new economic activity that would not have otherwise taken place.

Accepted Answer

A) True 
 B)False

Question 7

A company that formerly produced music CDs went out of business because too many potential customers bought illegally-produced copies of the CDs instead of buying the product directly from the company. This instance serves as an example of

Accepted Answer

A)   market power.
B)   inefficient trade.
C)   inadequate enforcement of property rights.
D)   the invisible hand at work.E) B) and C)
F) None of the above

Question 8

Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot.

Accepted Answer

A)   The cost of the parking permit is not part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
B)   The cost of the parking permit is part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
C)   Only half of the cost of the parking permit is part of the opportunity cost of attending college.
D)   The cost of the parking permit is not part of the opportunity cost of attending college under any circumstances.E) C) and D)
F) All of the above

Question 9

Both The Wealth of Nations and the Declaration of Independence share the point of view that

Accepted Answer

A)   every person is entitled to life, liberty, and the pursuit of happiness.
B)   individuals are best left to their own devices without the government guiding their actions.
C)   the government plays a central role in organizing a market economy.
D)   because of human nature a strong legal system is necessary for a market system to survive.E) All of the above
F) None of the above

Question 10

Suppose the cost of flying a 100-seat plane for an airline is $50,000 and there are 10 empty seats on a flight. The marginal cost of flying a passenger is

Accepted Answer

A)   $50.
B)   $500.
C)   $50,000.
D)   This cannot be determined from the information given.E) A) and B)
F) None of the above

Question 11

In communism, central planners decide which of the following?

Accepted Answer

A)   what goods and services will be produced
B)   how much will be produced
C)   who produced and consumed the goods and services
D)   All of the above are correct.E) C) and D)
F) B) and C)

Question 12

Scenario 1-4 You have the afternoon free. You have a choice between going to the movies with a friend or studying economics for three hours. If you go to the movies, you will spend $12.00 on a ticket and $4.75 on popcorn. If you choose to study economics for three hours, you will raise your exam grade by 15 points.
-Refer to Scenario 1-4. What is your opportunity cost of going to the movies?

Accepted Answer

$16.75 and...

Question 13

To say that government intervenes in the economy to promote efficiency is to say that government is attempting to

Accepted Answer

A)   create a more fair distribution of income.
B)   change the way in which the economic pie is divided.
C)   enlarge the economic pie.
D)   All of the above are correct.E) A) and D)
F) A) and C)

Question 14

A typical society strives to get the most it can from its scarce resources. At the same time, the society attempts to distribute the benefits of those resources to the members of the society in a fair manner. In other words, the society faces a tradeoff between

Accepted Answer

A)   guns and butter.
B)   efficiency and equality.
C)   inflation and unemployment.
D)   work and leisure.E) B) and C)
F) A) and D)

Question 15

Almost all variation in living standards is attributable to differences in countries'

Accepted Answer

A)   population growth rates.
B)   productivity.
C)   systems of public education.
D)   taxes.E) A) and C)
F) A) and B)

Question 16

Suppose the cost of operating a 75 room hotel for a night is $6,000 and there are 5 empty rooms for tonight. The marginal cost per room per night

Accepted Answer

A)   is $40.
B)   is $80.
C)   is $120.
D)   cannot be determined from the information given.E) C) and D)
F) None of the above

Question 17

Which of the following products would be considered scarce?

Accepted Answer

A)   bread
B)   baseballs autographed by Babe Ruth
C)   motorcycles
D)   All of the above are correct.E) All of the above
F) B) and D)

Question 18

The government can potentially improve market outcomes if market inequalities or market failure exists.

Accepted Answer

A) True 
 B)False

Question 19

Something that induces a person to act is called

Accepted Answer

A)   a trade-off.
B)   a policy.
C)   an incentive.
D)   an opportunity cost.E) A) and B)
F) All of the above

Question 20

The cost of an action is measured in terms of foregone opportunities.

Accepted Answer

A) True 
 B)False

Exam 1: Ten Principles of Economics

Both The Wealth of Nations and the Declaration of Independence share the point of view that

Correct Answer
verified

Which of the following can policy do?

Correct Answer
verified

Government policies resulting in reduced efficiency include

Correct Answer
verified

Almost all variation in living standards is attributable to differences in countries'

Correct Answer
verified

Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot.

Correct Answer
verified

Correct Answer
verified
$16.75 and...
View Answer

In the early 1980s, U.S. economic policy was directed toward reducing inflation. What would you have expected to observe during this short period of time?

Correct Answer
verified

Economics is the study of how society manages its

Correct Answer
verified

A typical society strives to get the most it can from its scarce resources. At the same time, the society attempts to distribute the benefits of those resources to the members of the society in a fair manner. In other words, the society faces a tradeoff between

Correct Answer
verified

Something that induces a person to act is called

Correct Answer
verified

The broken window fallacy states that when a window breaks and someone spends money to repair it, they have created new economic activity that would not have otherwise taken place.

Correct Answer
verified

Suppose the cost of operating a 75 room hotel for a night is $6,000 and there are 5 empty rooms for tonight. The marginal cost per room per night

Correct Answer
verified

Which of the following products would be considered scarce?

Correct Answer
verified

In communism, central planners decide which of the following?

Correct Answer
verified

Suppose the cost of flying a 100-seat plane for an airline is $50,000 and there are 10 empty seats on a flight. The marginal cost of flying a passenger is

Correct Answer
verified

A company that formerly produced music CDs went out of business because too many potential customers bought illegally-produced copies of the CDs instead of buying the product directly from the company. This instance serves as an example of

Correct Answer
verified

To say that government intervenes in the economy to promote efficiency is to say that government is attempting to

Correct Answer
verified

One effect of the government-imposed seat belt law in the U.S. has been

Correct Answer
verified

The cost of an action is measured in terms of foregone opportunities.

Correct Answer
verified

The government can potentially improve market outcomes if market inequalities or market failure exists.

Correct Answer
verified

Exam 1: Ten Principles of Economics

Both The Wealth of Nations and the Declaration of Independence share the point of view that

Correct AnswerverifiedShow Answer

Which of the following can policy do?

Correct AnswerverifiedShow Answer

Government policies resulting in reduced efficiency include

Correct AnswerverifiedShow Answer

Almost all variation in living standards is attributable to differences in countries'

Correct AnswerverifiedShow Answer

Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot.

Correct AnswerverifiedShow Answer

Correct Answerverified$16.75 and...View AnswerShow Answer

In the early 1980s, U.S. economic policy was directed toward reducing inflation. What would you have expected to observe during this short period of time?

Correct AnswerverifiedShow Answer

Economics is the study of how society manages its

Correct AnswerverifiedShow Answer

A typical society strives to get the most it can from its scarce resources. At the same time, the society attempts to distribute the benefits of those resources to the members of the society in a fair manner. In other words, the society faces a tradeoff between

Correct AnswerverifiedShow Answer

Something that induces a person to act is called

Correct AnswerverifiedShow Answer

The broken window fallacy states that when a window breaks and someone spends money to repair it, they have created new economic activity that would not have otherwise taken place.

Correct AnswerverifiedShow Answer

Suppose the cost of operating a 75 room hotel for a night is $6,000 and there are 5 empty rooms for tonight. The marginal cost per room per night

Correct AnswerverifiedShow Answer

Which of the following products would be considered scarce?

Correct AnswerverifiedShow Answer

In communism, central planners decide which of the following?

Correct AnswerverifiedShow Answer

Suppose the cost of flying a 100-seat plane for an airline is $50,000 and there are 10 empty seats on a flight. The marginal cost of flying a passenger is

Correct AnswerverifiedShow Answer

A company that formerly produced music CDs went out of business because too many potential customers bought illegally-produced copies of the CDs instead of buying the product directly from the company. This instance serves as an example of

Correct AnswerverifiedShow Answer

To say that government intervenes in the economy to promote efficiency is to say that government is attempting to

Correct AnswerverifiedShow Answer

One effect of the government-imposed seat belt law in the U.S. has been

Correct AnswerverifiedShow Answer

The cost of an action is measured in terms of foregone opportunities.

Correct AnswerverifiedShow Answer

The government can potentially improve market outcomes if market inequalities or market failure exists.

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
$16.75 and...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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