Test Bank for MICROECONOMICS 7th ed, by Michael Parkin

Test Bank for MICROECONOMICS 7th ed, by Michael Parkin

416PAGES. ALL Questions and Answers from every chapter

1) What do economists mean when they discuss “scarcity”?

2) What is the relationship between wants, factors of production, scarcity, and choices? Discuss the relationship for an individual and for a society.

3) Why do economists say that even very rich people face scarcity?

4) Explain why both rich and poor people experience scarcity.

5) What is the difference between scarcity and poverty?

6) Define economics and describe its branches of study.

7) What is the difference between microeconomics and macroeconomics?

8) What is the difference between microeconomics and macroeconomics? Give an example of an issue each studies.

9) Below is a student’s answer to the question “What is microeconomics?” If you were the instructor, how would you correct the student’s answer? “Microeconomics is the study of how government influences the choices made by individuals and businesses and of the performance of the whole national economy.”

10) China’s population is about 1.2 billion, while the population of the United States is about 280 million. This fact means that China has much more human capital than the U.S. does. True or false? Explain your answer. 

11) Explain what entrepreneurship is and why it is considered a factor of production.

12) An analyst on a local news channel argues that the recent corporate scandals “demonstrated very clearly that self interest always contradicts social interest.” Do you agree or disagree? Substantiate your answer.

13) What is a tradeoff? Give an example.

14) What is opportunity cost?

17) Ratherthangoouttoeatbyyourself,youdecidetostayat home and fix dinner for yourself and your two roommates. Your roommates applaud your decision. Your first roommate tells you that your decision to eat at home has no opportunity cost because you already have all the dinner ingredients in your pantry. Is this roommate’s comment correct?

18) A student can spend the next hour studying for a finance test, hiking along the Oregon coast, watching a rerun of Buffy the Vampire Slayer on television, or napping. If the student decides to study, what is the opportunity cost of her choice: hiking, watching television, or napping?