ECON 213 quiz 2 complete solutions answers Liberty University

ECON 213 quiz 2 complete solutions answers Liberty University

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Question 1 Refer to the following table to answer the questions that follow.

Given the same quantity of resources, what is Jay­Z’s opportunity cost of producing a New York pizza?

Question 2 The _________ illustrates the various combinations of output that a society can produce if all of its resources are being used efficiently.

Question 3 Refer to the following figures to answer the questions that follow.

Which allocation point in the short­run production possibilities frontier (PPF) will lead to the most significant growth in the long­run PPF?

Question 4 Suppose that, on a particular Saturday, Mark Zuckerberg and Bill Gates can either plant trees or spread mulch in their gardens. Their maximum output per day is listed in the following table, along with blanks where you can calculate the opportunity cost. At what terms of trade (relative price ratio) could they specialize and trade with one another so that both have more trees planted and mulch spread than they could accomplish on their own?

Question 5 Michael and Angelo are both artists who can create sculptures or paintings each day. The following table describes their maximum outputs per day. Use this table to answer the questions that follow.

What is Angelo’s opportunity cost of a sculpture?

Question 6 Which statement best describes the absolute advantage as shown in the graphs?

Question 7 Ceteris paribus, if a society is producing at a point on the production possibilities frontier (PPF), it can only increase the production of one good by:

Question 8 Suppose Jim is a brilliant attorney who can draft especially persuasive legal briefs. He also happens to possess some excellent administrative skills such as typing, filing, assembling binders and notes, and making reservations. Which best describes whether Jim should hire an administrative assistant to help him?

Question 9 Refer to the following figure to answer the questions that follow.

You can see that the opportunity cost of moving from point B to point D is different from the opportunity cost of moving from point D to point C because:

Question 10 Michael and Angelo are both artists who can create sculptures or paint paintings each day. The following table describes their maximum outputs per day. Does either person have an absolute advantage?

Question 11 Refer to the following figure for the questions that follow

According to the figure, a new technology that makes it easier to peel, core, and prepare apples will cause:

Question 12 The _________ states that the opportunity cost of producing a good always rises as you produce more of it.

Question 13 Why do economists use models?

Question 14 The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow.

What is Gibbs’s opportunity cost of solving a crime?

Question 15 A society that is producing its maximum combination of goods and using all available resources for production:

Question 16 Which of the following is a positive statement?

Question 17 You have a comparative advantage in producing a good whenever:

Question 18 One reason that economists make assumptions when designing models is to:

Question 19 Economic growth can be depicted on a production possibilities frontier (PPF) as an:

Question 20 Use these production possibilities frontier (PPF) curves, which compare the ancient production of agricultural products to art and literature, to answer the questions that follow. Suppose the printing press is invented. Which graph best depicts how this would affect the PPF?

Question 1 The _________ states that the opportunity cost of producing a good always rises as you produce more of it.

Question 2 Which of the following is a positive statement?

Question 3 Which of the following is a positive statement?

Question 4 An economist’s use of experiments and real­world data to test a theory is an example of:

Question 5 A society that is producing its maximum combination of goods and using all available resources for production:

Question 6 When testing a paper airplane on your campus quad, which of the following would be an exogenous factor?

Question 7 Which of the following is a positive statement?

Question 8 On the television show “MythBusters,” the hosts design experiments, collect data, and test theories based on popular myths. This is an example of:

Question 9 Refer to the following figure for the questions that follow.

As you move from points N to M to L, the opportunity cost of additional apple pie:

Question 10 The movie Saving Private Ryan is about a military mission to find and recover a particular soldier —Private Ryan. The movie is predominantly about how much was given up in an effort to save this one particular soldier. The main economic theme of the movie is:

Question 11 Refer to the following figure for the questions that follow.

According to the figure, a new technology that makes it easier to peel, core, and prepare apples will cause:

Question 12 Refer to the following figure to answer the questions that follow

Which of the following represents an inefficient point?

Question 13 If Elaine can produce more output from a set amount of resources than Jerry can, you know that:

Question 14 An increase in general resources that affects the production of both goods on a production possibilities frontier (PPF) would cause an:

Question 15 Refer to the following figure to answer the questions that follow.

What is the most preferred consumption point for a pie­appreciating society?

Question 16 The important act of holding all other variables constant while examining a particular variable is known as:

Question 17 You have an absolute advantage in producing something whenever:

Question 18 Refer to the accompanying figure to answer the questions that follow.

The inefficient point(s) is (are):

Question 19 Michael and Angelo are both artists who can create sculptures or paint paintings each day. The following table describes their maximum outputs per day. Does either person have an absolute advantage?

Question 20 Car companies build wind tunnels to test the aerodynamics and the handling capabilities of their car designs. The many variables that can be precisely controlled inside the wind tunnel are considered:

Question 1 The _________ states that the opportunity cost of producing a good always rises as you produce more of it.

Question 2 Which of the following is a positive statement?

Question 3 Which of the following is a positive statement?

Question 4 An economist’s use of experiments and real­world data to test a theory is an example of:

Question 5 A society that is producing its maximum combination of goods and using all available resources for production:

Question 6 When testing a paper airplane on your campus quad, which of the following would be an exogenous factor?

Question 7 Which of the following is a positive statement?

Question 8 On the television show “MythBusters,” the hosts design experiments, collect data, and test theories based on popular myths. This is an example of:

Question 9 Refer to the following figure for the questions that follow.

As you move from points N to M to L, the opportunity cost of additional apple pie:

Question 10 The movie Saving Private Ryan is about a military mission to find and recover a particular soldier —Private Ryan. The movie is predominantly about how much was given up in an effort to save this one particular soldier. The main economic theme of the movie is:

Question 11 Refer to the following figure for the questions that follow.

According to the figure, a new technology that makes it easier to peel, core, and prepare apples will cause:

Question 12 Refer to the following figure to answer the questions that follow.

Which of the following represents an inefficient point?

Question 13 If Elaine can produce more output from a set amount of resources than Jerry can, you know that:

Question 14 An increase in general resources that affects the production of both goods on a production possibilities frontier (PPF) would cause an:

Question 15 Refer to the following figure to answer the questions that follow.

What is the most preferred consumption point for a pie­appreciating society?

Question 16 The important act of holding all other variables constant while examining a particular variable is known as:

Question 17 You have an absolute advantage in producing something whenever:

Question 18 Refer to the accompanying figure to answer the questions that follow.

The inefficient point(s) is (are):

Question 19 Michael and Angelo are both artists who can create sculptures or paint paintings each day. The following table describes their maximum outputs per day. Does either person have an absolute advantage?

Question 20 Car companies build wind tunnels to test the aerodynamics and the handling capabilities of their car designs. The many variables that can be precisely controlled inside the wind tunnel are considered:

Question 1 Refer to the following table to answer the questions that follow. Given the same quantity of resources, what is Jay­Z’s opportunity cost of producing a New York pizza?

Question 2 The _________ illustrates the various combinations of output that a society can produce if all of its resources are being used efficiently.

Question 3 Refer to the following figures to answer the questions that follow Which allocation point in the short­run production possibilities frontier (PPF) will lead to the most significant growth in the long­run PPF?

Question 4 Suppose that, on a particular Saturday, Mark Zuckerberg and Bill Gates can either plant trees or spread mulch in their gardens. Their maximum output per day is listed in the following table, along with blanks where you can calculate the opportunity cost. At what terms of trade (relative price ratio) could they specialize and trade with one another so that both have more trees planted and mulch spread than they could accomplish on their own?

Question 5 Michael and Angelo are both artists who can create sculptures or paintings each day. The following table describes their maximum outputs per day. Use this table to answer the questions that follow. What is Angelo’s opportunity cost of a sculpture?

Question 6 Which statement best describes the absolute advantage as shown in the graphs?

Question 7 Ceteris paribus, if a society is producing at a point on the production possibilities frontier (PPF), it can only increase the production of one good by:

Question 8 Suppose Jim is a brilliant attorney who can draft especially persuasive legal briefs. He also happens to possess some excellent administrative skills such as typing, filing, assembling binders and notes, and making reservations. Which best describes whether Jim should hire an administrative assistant to help him?

Question 9 Refer to the following figure to answer the questions that follow. You can see that the opportunity cost of moving from point B to point D is different from the opportunity cost of moving from point D to point C because:

Question 10 Michael and Angelo are both artists who can create sculptures or paint paintings each day. The following table describes their maximum outputs per day. Does either person have an absolute advantage?

Question 11 Refer to the following figure for the questions that follow. According to the figure, a new technology that makes it easier to peel, core, and prepare apples will cause:

Question 12 The _________ states that the opportunity cost of producing a good always rises as you produce more of it.

Question 13 Why do economists use models?

Question 14 The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow. What is Gibbs’s opportunity cost of solving a crime?

Question 15 A society that is producing its maximum combination of goods and using all available resources for production:

Question 16 Which of the following is a positive statement?

Question 17 You have a comparative advantage in producing a good whenever:

Question 18 One reason that economists make assumptions when designing models is to:

Question 19 Economic growth can be depicted on a production possibilities frontier (PPF) as an:

Question 20 Use these production possibilities frontier (PPF) curves, which compare the ancient production of agricultural products to art and literature, to answer the questions that follow. Suppose the printing press is invented. Which graph best depicts how this would affect the PPF?

Question 1

Refer to the following figure for the questions that follow.

The opportunity cost of increasing production of apple pies from 14 to 16 pies is:

Question 2

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow.

What is Gibbs’s opportunity cost of solving a crime?

Question 3

Michael and Angelo are both artists who can create sculptures or paintings each day. The following table describes their maximum outputs per day. Does either one have a comparative advantage?

Question 4

The opportunity cost of every investment in capital goods is:

Question 5

Refer to the following table to answer the questions that follow.

Given the same quantity of resources, what is Alicia Keys’s opportunity cost of producing a New York pizza?

Question 6

Economic growth is represented on a production possibilities frontier (PPF) by the PPF:

Question 7

The _________ illustrates the various combinations of output that a society can produce if all of its resources are being used efficiently.

Question 8

The accompanying figures depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between making pizzas and making stromboli. If Jim and Pam were to specialize and trade, at what exchange rate would they find some quantity of trade to be mutually beneficial?

Question 9

Use these production possibilities frontier (PPF) curves, which compare the ancient production of agricultural products to art and literature, to answer the questions that follow.

Suppose a great plague wipes out half of the society’s population. Which of the following graphs best depicts how this would affect the PPF?

Question 10

Consider the following scenario to answer the questions that follow: Two friends, Rachel and Joey, enjoy baking bread and making apple pies. Rachel takes two hours to bake 1 loaf of bread and one hour to make 1 pie. Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie.

What is Rachel’s opportunity cost of baking 1 loaf of bread?

Question 11

When the opportunity cost of producing a good rises as you produce more of it, you experience:

Question 12

When one producer can create more of a good than another producer using the same quantity of resources, the first producer has:

Question 13

If Elaine can produce more output from a set amount of resources than Jerry can, you know that:

Question 14

A model without any simplifying assumptions:

Question 15

When one producer has a comparative advantage in production, she:

Question 16

Refer to the following figure for the questions that follow.

According to the figure, a new technology that makes it easier to peel, core, and prepare apples will cause:

Question 17

Refer to the following table to answer the questions that follow.

Given an eighthour workday, which statement best describes the absolute advantage evident in the table?

Question 18

Consider the production possibilities frontier (PPF) shown in the figure below to answer the questions that follow.

The set of efficient points is best described as:

Question 19

Refer to the following figure to answer the questions that follow.

What is the most preferred consumption point for a pieappreciating society?

Question 20

Which of the following is a positive statement?

Question 1 The area inside (within) the production possibilities frontier (PPF) contains:

Question 2 Michael and Angelo are both artists who can create sculptures or paint paintings each day. The following table describes their maximum outputs per day. Does either person have an absolute advantage?

Question 3 The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow. What is Gibbs’s opportunity cost of making a wooden boat?

Question 4 The ability of one producer to create more of a good than another producer using the same quantity of resources is called:

Question 5 The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow. Which statement best describes absolute advantage?

Question 6 You have a comparative advantage in producing a good whenever:

Question 7 Mrs. Abel has a comparative advantage in producing cabbage if, in comparison to Mrs. Bee, Mrs. Abel can grow cabbage:

Question 8 The important act of holding all other variables constant while examining a particular variable is known as:

Question 9 An increase in general resources that affects the production of both goods on a production possibilities frontier (PPF) would cause an:

Question 10 Use these production possibilities frontier (PPF) curves, which compare the ancient production of agricultural products to art and literature, to answer the questions that follow. Suppose the plow is invented and agricultural productivity greatly increases. Which of the following graphs best depicts how this would affect the PPF?

Question 11 Suppose you find a production possibilities frontier (PPF) that is shaped like a straight line. What can you determine about the production of the two goods?

Question 12 A town on the Gulf Coast is battered by a massive hurricane that destroys most of its productive resources. The community’s production possibilities frontier (PPF) would show an:

Question 13 Think of the production possibilities frontier (PPF) model. When society is producing the largest possible output from its resources, it is operating:

Question 14 Which of the following is a positive statement?

Question 15 When the opportunity cost of producing a good rises as you produce more of it, you experience:

Question 16 Which of the following is a normative statement?

Question 17 Refer to the following figure to answer the questions that follow. In the figure, point E is:

Question 18 An economist’s use of experiments and real­world data to test a theory is an example of:

Question 19 Consider the production possibilities frontier (PPF) shown in the figure below to answer the questions that follow. Given current resources and technology, the unattainable range is best described as:

Question 20 Refer to the following figure to answer the questions that follow. Which point in the corresponding figure represents a combination of smoothies and milk shakes that society cannot currently produce?

Question 1 Economists use the scientific method and the tools of economics to study:

Question 2 Ceteris paribus, if a society is producing at a point on the production possibilities frontier (PPF), it can only increase the production of one good by:

Question 3 Goods that are produced today in order to make other valuable goods and services in the future are called:

Question 4 Use these production possibilities frontier (PPF) curves, which compare the ancient production of agricultural products to art and literature, to answer the questions that follow. Suppose the printing press is invented. Which graph best depicts how this would affect the PPF?

Question 5 Refer to the following table to answer the questions that follow. Given the same quantity of resources, what is Jay­Z’s opportunity cost of producing a New York pizza?

Question 6 Refer to the following figure to answer the questions that follow. Which point in the corresponding figure represents a combination of smoothies and milk shakes that society cannot currently produce?

Question 7 Which of the following is a normative statement?

Question 8 Refer to the following figure for the questions that follow. The opportunity cost of increasing production of apple pies from 14 to 16 pies is:

Question 9 Which of the following is a positive statement? Selected Answer: e. Increases in the minimum wage cause unemployment. Question 10 Refer to the following figure to answer the questions that follow. In the figure, point E is:

Question 11 The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow. What is DiNozzo’s opportunity cost for solving a crime?

Question 12 Greater investment in capital goods today leads to:

Question 13 Suppose that Sheldon and Leonard can either run errands or wash dishes. Their maximum output per hour is listed in the following table. Given the same quantity of resources, at what terms of trade (relative price ratio) could they specialize and trade so that both consume outside their own production possibilities frontier (PPF)?

Question 14 For both parties to benefit from specialization and trade, the trading parties must agree on:

Question 15 Which of the following is NOT an assumption that economists make when developing a production possibilities frontier (PPF)?

Question 16 Which of the following is a positive statement?

Question 17 The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between making pizzas and making stromboli. Refer to these figures to answer the questions that follow. What is Jim’s opportunity cost of making 1 stromboli?

Question 18 Consider the following scenario to answer the questions that follow: Two friends, Rachel and Joey, enjoy baking bread and making apple pies. Rachel takes two hours to bake 1 loaf of bread and one hour to make 1 pie. Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie. What is Rachel’s opportunity cost of baking 1 loaf of bread?

Question 19 The _________ illustrates the various combinations of output that a society can produce if all of its resources are being used efficiently.

Question 20 A graph that shows the maximum attainable combinations of two goods when society efficiently uses its productive resources is called:

Question 1 When one producer has a comparative advantage in production, she:

Question 2 The process of using current resources to create or buy new capital is called:

Question 3 A positive statement:

Question 4 An increase in general resources that affects the production of both goods on a production possibilities frontier (PPF) would cause an:

Question 5 Refer to the following table to answer the questions that follow. Given the same quantity of resources, what is Jay­Z’s opportunity cost of producing a New York pizza?

Question 6 Refer to the following figure for the questions that follow. According to the figure, a new technology that makes it easier to peel, core, and prepare apples will cause:

Question 7 To determine which of two producers has a comparative advantage, you would need to know their:

Question 8 Consider the following scenario. Two friends, Rachel and Joey, enjoy baking bread and making apple pies. Rachel takes two hours to bake one loaf of bread and one hour to make one pie. Joey takes four hours to bake one loaf of bread and four hours to make one pie. If Rachel and Joey decide to specialize in order to maximize their combined output, who should produce what?

Question 9 Refer to the accompanying figure to answer the questions that follow. Unemployed resources are evident at:

Question 10 Refer to the following table to answer the questions that follow. Suppose that Alicia Keys and Jay­Z could each make either New York–style pizza or Philly cheesesteaks. Given an eight­hour workday, which of the following would permit them to consume outside their respective production possibilities frontiers (PPFs)?

Question 11 When the opportunity cost of producing a good rises as you produce more of it, you experience:

Question 12 The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between making pizzas and making stromboli. Refer to these figures to answer the questions that follow. What is Jim’s opportunity cost of making 1 stromboli?

Question 13 Ceteris paribus means:

Question 14 The ability of one producer to create more of a good than another producer using the same quantity of resources is called:

Question 15 Which of the following is a positive statement?

Question 16 Refer to the following table to answer the questions that follow. Given an eight­hour workday, and to experience gains from trade,

Question 17 Consider the production possibilities frontier (PPF) shown in the figure below to answer the questions that follow. Given current resources and technology, the attainable range is best described as:

Question 18 Which of the following is a normative statement?

Question 19 Consider the following scenario to answer the questions that follow: Two friends, Rachel and Joey, enjoy baking bread and making apple pies. Rachel takes two hours to bake 1 loaf of bread and one hour to make 1 pie. Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie. What is Joey’s opportunity cost of baking 1 pie?

Question 20 Suppose you are studying a production possibilities frontier (PPF) that has a bowed­out shape relative to the origin. What causes this shape?

The process of using current resources to create or buy new capital is called

The movie Saving Private Ryan is about a military mission to find and recover a particular soldier—Private Ryan. The movie is predominantly about how much was given up in an effort to save this one particular soldier. The main economic theme of the movie is

An increase in the labor force would be reflected in a society’s production possibilities frontier (PPF) by an

Refer to the following figure for the questions that follow According to the figure, a new technology that makes it easier to peel, core, and prepare apples will cause.

The ability of one producer to produce a good at a lower opportunity cost than another producer is called

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow. Which statement best describes absolute advantage?

Refer to the following table to answer the questions that follow. Given the same quantity of resources, what is Alicia Keys’s opportunity cost of producing a New York pizza?

If Jim can sell paper at a lower opportunity cost than Dwight can, then

Greater investment in capital goods today leads to

Consider the following scenario to answer the questions that follow: Two friends, Rachel and Joey, enjoy baking bread and making apple pies. Rachel takes two hours to bake 1 loaf of bread and one hour to make 1 pie. Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie. What is Rachel’s opportunity cost of baking 1 loaf of bread?

One reason that economists make assumptions when designing models is to

Suppose you are studying a production possibilities frontier (PPF) that has a bowed-out shape relative to the origin. What causes this shape?

Ceteris paribus means

The important act of holding all other variables constant while examining a particular variable is known as:

Variables that are controlled for in a model are called

Refer to the following figures to answer the questions that follow. Which allocation point in the short-run production possibilities frontier (PPF) will lead to the most significant growth in the long-run PPF?

You have a comparative advantage in producing a good whenever

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow. What is Gibbs’s opportunity cost of solving a crime?

When testing a paper airplane on your campus quad, which of the following would be an exogenous factor?

Consider the following scenario to answer the questions that follow: Two friends, Rachel and Joey, enjoy baking bread and making apple pies. Rachel takes two hours to bake 1 loaf of bread and one hour to make 1 pie. Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie. What is Joey’s opportunity cost of baking 1 pie?

When the price is the equilibrium price, we would expect there to be a causing the market to put pressure on the price until it went back to the equilibrium price.

Suppose that Dwight and Jim can either make salads or grill steaks. Their maximum output per hour is listed in the following table. Given the same quantity of resources, at what terms of trade (relative price ratio) could they specialize and trade so that both consume outside their own production possibilities frontier (PPF)?

What would you expect to happen to the price of bagels if the price of flour decreased and the price of cream cheese decreased?

To determine which of two producers has a comparative advantage, you would need to know their

The area inside (within) the production possibilities frontier (PPF) contains

Economics professors are well aware of the importance of incentives. Which of the following situations shows the use of a positive incentive

Which one of the following pairs of goods is likely to have a negative cross-price elasticity of demand

The accompanying figures depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between making pizzas and making stromboli. If Jim and Pam were to specialize and trade, at what exchange rate would they find some quantity of trade to be mutually beneficial?

Use the following table to answer the questions that follow. What is the surplus when the price floor is $0.75 in the market for public transportation?

Why are binding price ceiling laws passed?

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow. Which statement best describes absolute advantage?

Which of the following will cause a movement along a good’s supply curve?

What would happen in the market for SUVs if the government started to subsidize the production of SUVs that get very few miles per gallon and the price of gasoline went up?

If the percentage change in the quantity consumed of pizza is 8% and the percentage change in income is 2%, what is the income elasticity of demand for pizza?

If the price and quantity for a normal good, Good X, is $8 and 6 units at the original equilibrium, what is one possibility for the new equilibrium of Good X if we see income increase and all other factors stay constant?

Chris runs a sporting goods store and knows that the price elasticity of demand for his sports clothing line is –1.5. He is planning to lower prices by 10%. The percentage change in quantity demanded will be

If the cross-price elasticity of demand for two goods is zero, the two goods are

The price of peanut butter increases from $2.50 to $3.00 and the quantity of jelly demanded falls from 30 jars to 24 jars. Calculate the cross-price elasticity of demand

During the winter months, many elderly persons leave their homes in northern New York and travel south to Florida or Arizona. What would you expect to happen to the equilibrium price and quantity of items most used by the elderly in northern New York?

When Heavenly Cookies prices its sugar cookies at $1.00, they sell 75 cookies. They lowered the price to $0.50 and sold 200 cookies. Their total revenue because the price elasticity of demand for sugar cookies is

For a market to be competitive

If a good is subject to a binding price ceiling and you purchase it on the black market, what do you expect to happen to the price over time?

Use these production possibilities frontier (PPF) curves, which compare the ancient production of agricultural products to art and literature, to answer the questions that follow. Suppose a great plague wipes out half of the society’s population. Which of the following graphs best depicts how this would affect the PPF?

In the first few months of 2012, the price of gasoline increased by approximately 15%. Because of this increase, we would expect the curve in the market for hybrid cars to

An increase in general resources that affects the production of both goods on a production possibilities frontier (PPF) would cause an

Use the following scenario to answer the questions that follow: Dairy Dream, a local ice cream store, finds that it sells out of ice cream sandwiches at the current price of $1. It raises the price to increase its revenues and finds that no one buys ice cream sandwiches anymore.

While there are many pizza places in Curtisville, Pappy’s Pizza is known for its distinctive deep-dish pizza with an almost pie-like crust, whereas Momma’s Pizza Pizzazz is comparable to many other restaurants. Pappy’s is likely to find that it can prices to increase total revenue, and Mommas must              prices to increase total revenue.

The scientific method and the tools of economics are useful in examining

A positive statement

When the price of a basketball is $15, the quantity supplied is 5,000. When the price increases to $20, the quantity supplied is 10,000. The price elasticity of supply is

Which of the following will cause the demand curve for burgers to shift the right?

You have an absolute advantage in producing something whenever

From the accompanying table, we would expect that, for recreational skaters, the price elasticity of demand for ice skates between $10 and $20 to be than that of hockey players because

Refer to the accompanying figure. What event would cause the supply curve to shift out?

The production possibilities frontier (PPF) shows

With no barriers to entry or exit and when firms in a market are operating at a loss, you can expect other firms to exit, causing the curve to shift to the and making the equilibrium price and the equilibrium quantity

Google has started a project to scan all books and make those that are not copyrighted available to people free of charge. Why is it important that only books without a copyright are available?

According to economists, one reason few professional athletes have PhD’s is that the

What will happen in a market where a binding price floor is removed?

What would you expect to happen to the price and quantity of Pepsi if the price of Coke increases and Pepsi develops a new technology that makes its production process more efficient?

Which statement best describes the absolute advantage as shown in the graphs?

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the questions that follow. What is DiNozzo’s opportunity cost for solving a crime?

Ceteris paribus, if a society is producing at a point on the production possibilities frontier (PPF), it can only increase the production of one good by

In the accompanying table, assume that the price of ice skates increases from $10 to $20 per pair. Using the midpoint method, calculate the price elasticity of demand for ice skates for hockey players.

Refer to the following figure for the questions that follow. As you move from points N to M to L, the opportunity cost of additional apple pie

Assume that the market for pencils is in equilibrium and that demand is very price elastic. The popularity of digital tablets and electronic pens increases and demand for pencils declines. The equilibrium change in quantity demanded is

Refer to the accompanying figure. When the price changes from P1 to P2, we will see a(n)

Use the following scenario to answer the questions that follow. Dairy Dream, a local ice cream store, finds that it sells out of ice cream sandwiches at the current price of $1. It raises the price to increase its revenues and finds that no one buys ice cream sandwiches anymore. The owners raised the price because they believed that the demand for ice cream sandwiches is

Spam is considered an inferior good. What would happen to the equilibrium price and quantity of Spam if income decreased and more firms started producing Spam?

Refer to the accompanying table to answer the questions that follow. The price of erasers increases from $0.50 to $1.00 per eraser. Use the midpoint method to calculate the cross-price elasticity of demand between pencils and erasers.

Question 1

Economics is the study of:

Select one:

a. markets

b. How to make workers more productive and firms more profitable.

c. How to allocate resources to satisfy wants and needs.

d. How to make money.

e. Capitalism

Question 2

An example of a direct positive incentive is:

Select one:

a. Threatening to fire those who do not perform well.

b. Unemployment insurance for those who are laid off.

c. A prison sentence for committing a crime.

d. Providing a workplace safety program.

e. Providing a commission for sales.

Question 3

A health insurance company may offer its policyholders a discount on their premiums if they prove that

they have stopped smoking. What type of incentive is the health insurance company offering?

Select one:

a. an unintended incentive.

b. A neutral incentive.

c. complementary incentive.

d. A direct incentive.

e. An indirect incentive.

Question 4

The cost of a trade-off is known as the ________ of that decision.

Select one:

a. opportunity cost

b. marginal cost

c. net cost

d. comparative cost

e. explicit cost

Question 5

Instead of taking an economics course, you could have taken a history course that meets at the exact

same time. The total cost of taking the economics course would be:

Select one:

a. the fact that you could not take the history course at the same time.

b. the tuition cost, the cost of the textbook and notebook, and the fact that you could not take the history

course at the same time.

c. the tuition cost for the economics course plus the price of the textbook and a notebook for the

economics course.

d. the price of the textbook and a notebook for the economics course.

e. the tuition cost for the economics course.

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Question 6

The opportunity cost of working rather than going to school is:

Select one:

a. zero because the person is earning an income by working.

b. the cost of clothing and transportation.

c. the higher wages that come with additional education.

d. the cost of food and housing.

e. the annual wages earned by working.

Question 7

On the television show “MythBusters,” the hosts design experiments, collect data, and test theories based

on popular myths. This is an example of:

Select one:

a. the scientific method as used in economics.

b. economic growth.

c. absolute advantage.

d. gains from trade.

e. production possibilities.

Question 8

The area inside (within) the production possibilities frontier (PPF) contains:

Select one:

a. normative points.

b. inefficient points.

c. efficient points.

d. positive points.

e. high opportunity cost points.

Question 9

How will a reduction in the national unemployment rate affect a nation’s production possibilities frontier

(PPF)?

Select one:

a. It will move society to a point farther inside the PPF.

b. It will cause the PPF to shift inward.

c. It will move society outward to a point closer to or on the PPF.

d. It will push society to a point outside its PPF.

e. It will cause the PPF to shift outward.

Question 12

The movie Saving Private Ryan is about a military mission to find and recover a particular soldier—

Private Ryan. The movie is predominantly about how much was given up in an effort to save this one

particular soldier. The main economic theme of the movie is:

Select one:

a. opportunity cost.

b. comparative advantage.

c. positive advantage.

d. normative analysis.

e. absolute advantage.

Question 15

Consider the following scenario to answer the questions that follow: Two friends, Rachel and Joey, enjoy

baking bread and making apple pies. Rachel takes two hours to bake 1 loaf of bread and one hour to

make 1 pie. Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie.

What is Joey’s opportunity cost of baking 1 loaf of bread?

Select one:

a. 1 loaf of bread

b. 1/2 loaf of bread.

c. 1 pie

d. 2 pies

e. 4 pies

Question 16

Consider the following scenario to answer the questions that follow: Two friends, Rachel and Joey, enjoy

baking bread and making apple pies. Rachel takes two hours to bake 1 loaf of bread and one hour to

make 1 pie. Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie.

What is Rachel’s opportunity cost of baking 1 pie?

Select one:

a. 1 pie

b. 2 pies

c. 2 loaves of bread.

d. 1 loaf of bread

e. 1/2 loaf of bread

Question 17

The ability of one producer to create more of a good than another producer using the same quantity of

resources is called:

Select one:

a. a positive-sum game.

b. absolute advantage.

c. gains from trade

d. the law of increasing relative cost.

e. comparative advantage.

Question 18

The ability of one producer to produce a good at a lower opportunity cost than another producer is called:

Select one:

a. absolute advantage.

b. a zero-sum game.

c. comparative advantage.

d. a normative statement.

e. the law of increasing relative cost.

Question 19

For both parties to benefit from specialization and trade, the trading parties must agree on:

Select one:

a. the appropriate level of investment for the future.

b. the source of comparative advantage.

c. who has the absolute advantage in production.

d. a plan not to trade with other parties.

e. a price somewhere between their opportunity costs of production.

Question 20

Why do economists use models?

Select one:

a. Models allow us to control exogenous factors.

b. Models allow us to study a simplified version of a complex world.

c. Models make the world harder to understand.

d. Models allow us to examine more factors than what actually exists in our world.

e. Models are used to add complexity to a simple world.

The basic goal of economics is:

The patent system acts as:

Economics is concerned with the trade-offs that emerge because of scarcity. The term "trade-offs" refers to:

An opportunity cost is the:

How are changes in opportunity cost related to decision-making behavior?

Why would economists find it surprising if the CEP of a large company does his or her own housework?

Economists believe that optimal decisions are made up to the point where:

One way to promote a new business is to offer free items. If you were to open a new restaurant and offer free food, you likely would have a line out the door. How would economists understand the behavior of those standing in line?

Many stores are open 24 hours a day. When store managers make the decision to stay open 24 hours, it must be the case that:

More oranges are grown in Florida than North Dakota because Florida's warm climate gives it a ___________ in growing organges

Which of the following is a normative statement?
a) you should wear a helmet when cycling
b) the sky is blue
c) a bicycle has two wheels
d) a unicycle has five wheels
e) electricity follows the path of least resistance

The area inside (within) the production possibilities frontier (PPF) contains:

Think of the production possibilities frontier (PPF) model. When society is producing the largest possible output from its resources, it is operating:
a) inefficiently
b) efficiently
c) with no opportunity cost
d) inside (within) the PPF
e) beyond its opportunity cost

Suppose you find a production possibilities frontier (PPF) that is shaped like a straight-line. What can you determine about the production of the two goods?

A monopoly:

Imperfect markets: 
a) do not exist in democracies
b) always result in supply exceeding demand
c) always result in demand exceeding supply
d) occur when the buye