econ test

Multiple Attempts

This test allows 2 attempts. This is attempt number 1.

Force Completion

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Which products will be in scarce supply and which in excess supply?

Who should appoint the head of the central bank?

How much should society save?

What goods and services will be produced?

product; financial

resource; product

product; resource

capital; product

requires a grouping of private markets linked to one another.

is a particular set of institutional arrangements and a coordinating mechanism used to respond to the economizing problem.

requires some sort of centralized authority (such as government) to coordinate economic activity.

is a plan or scheme that allows a firm to make

money

at some other firm’s expense.

Who owns the factors of production, and the methods used to coordinate economic activity.

The technology used in production, and the quantity and quality of natural resources.

How goods are produced, and who gets them.

The political system in place, and the degree of scarcity facing the economy.

the economy is using its resources inefficiently.

resources are perfectly shiftable among alternative uses.

production

technology is fixed.

the economy is engaging in international trade.

an upsloping line that is bowed out from the origin.

a downsloping line that is bowed in toward the origin.

a downsloping line that is bowed out from the origin.

a straight upsloping line.

private property and freedom of expression.

independently acting buyers and sellers and freedom to enter or leave markets.

increasing opportunity costs and diminishing marginal utility.

capital goods and division of labor.

goods and resources respectively.

money incomes and output respectively.

output and money incomes respectively.

resources and goods respectively.

factory workers

computers at a retail store

a forest

they measure marginal changes.

they always tell us something about profits.

positive slopes are always preferred to negative slopes.

they always relate to resource and output scarcity.

a professional soccer player

water in a town’s reservoir

money in a business checking account

the manager of the local hamburger restaurant

the smallest physical amounts of inputs are used to produce each good.

each good is produced at a level where marginal benefits equal marginal costs.

large amounts of capital goods are produced relative to consumer goods.

large amounts of consumer goods are produced relative to capital goods.

major topics of macroeconomics.

not relevant to the U.S. economy.

major topics of microeconomics.

peculiar to command economies.

tuition, while an indirect cost (opportunity cost) is books and other supplies.

forgone income while in college, while an indirect cost (opportunity cost) is tuition.

tuition, while an indirect cost (opportunity cost) is forgone income while in college.

books and supplies, while an indirect cost (opportunity cost) is food and housing.

price and profit signals eliminated those shortages and surpluses.

price and profit signals intensified those shortages and surpluses.

producers would not react because no price or profit signals occurred.

the planners would immediately adjust production to achieve equilibrium.

where MB = MC.

at every point along

a production possibilities curve.

where the marginal benefit is at its greatest.

where the marginal cost is at its lowest.

North Korea’s command economy has significantly outperformed South Korea’s market economy.

South Korea’s command economy has significantly outperformed North Korea’s market economy.

North Korea’s market economy has significantly outperformed South Korea’s command economy.

South Korea’s market economy has significantly outperformed North Korea’s command economy.

market systems.

pure capitalism.

laissez-faire capitalism.

communism.

the quantities of all resources are unlimited.

some resources are unemployed.

there is no inflation in the economy.

The desires of resource suppliers and producers to further their own self-interest will automatically further the public interest.

The non-substitutability of resources creates a conflict between private and public interests and calls for government intervention.

The market system is the best system for overcoming the scarce resources-unlimited wants problem.

Central direction by the government will improve resource allocation in a capitalistic economy.

a positive slope that increases as we move along it from left to right.

a negative slope that increases as we move along it from left to right.

a negative slope that decreases as we move along it from left to right.

a negative slope that is constant as we move along it from left to right.

both buyers in the resource market.

both sellers in the product market.

sellers in the resource and product markets respectively.

sellers in the product and resource markets respectively.

the two graph as an upsloping line.

an increase in one variable is associated with a decrease in the other.

an increase in one variable is associated with an increase in the other.

the resulting relationship can be portrayed by a straight line parallel to the horizontal axis.

money capital.

depreciation.

investment.

consumption.

households are buyers of resources.

businesses are sellers of final products.

households are sellers of final products.

there are real flows of goods, services, and resources, but not money flows.

idling some of its resources.

specializing and engaging in international trade.

buying the debt (bonds and stocks) of foreign nations.

producing more capital goods and fewer consumer goods.

“there is no free lunch.”

“let it be.”

“circular flow.”

“public ownership.”

a demand curve.

consumer expenditure line.

a budget line.

private ownership of all capital.

central planning.

heavy reliance on markets.

wide-spread dispersion of economic power.

derived demand.

consumer sovereignty.

the invisible hand.

market failure.

make routine pricing decisions.

innovate.

purchase capital.

create market demand.

versatility and flexibility.

rationality.

pleasure or satisfaction.

purposefulness.

are useless because they are not based on laboratory experimentation.

that are true for individual economic units are never true for the economy as a whole.

are generalizations based on a careful observation of facts.

are abstractions and therefore of no application to real situations.

Microeconomics focuses on specific decision-making units of the economy; macroeconomics examines the economy as a whole.

Macroeconomics focuses on specific decision-making units of the economy; microeconomics examines the economy as a whole.

Every topic in economics is either a microeconomic or a macroeconomic issue; a topic cannot be both.

Topics in microeconomics have public policy implications; topics in macroeconomics do not.

because economic systems are composed of so many diverse economic units, economic laws are necessarily inexact.

the anticipation of a particular event can affect the composition of that event when it occurs.

what is true for the individual must necessarily be true for the group.

because event A precedes event B, A is necessarily the cause of B.

property rights.

central planning by government.

unselfish behavior.

government-set wages and prices.

shows all of those levels of production that are consistent with a stable price level.

indicates that any combination of goods lying outside the curve is economically inefficient.

is a frontier between all combinations of two goods that can be produced and those combinations that cannot be produced.

shows all of those combinations of two goods that are most preferred by society.

desirability of the two products.

price ratio of the two products.

amount of the consumer’s income.

utility ratio of the two products.

capital goods and consumer goods.

free and controlled.

product and resource.

household and business.

private property.

freedom of enterprise.

government ownership of major industries.

competition in product and resource markets.

the need to make choices because economic wants exceed economic means.

how to distribute resources equally amongst all members of society.

that people’s means often exceed their wants.

that people do not know how to rationally allocate resources.

public ownership of all capital.

wide-spread private ownership of capital.

a circular flow of goods, resources, and money.

is one of the few remaining command economies.

has grown much faster than South Korea since the two countries were divided after World War II.

produces a per capita GDP of nearly $25,000.

has undergone significant market reforms and is now one of the fastest growing economies.

analysis of how a consumer tries to spend income.

study of the large aggregates of the economy or the economy as a whole.

analysis of how firms attempt to maximize their profits.

study of how supply and demand determine prices in individual markets.

people are selfish in their decision-making.

people weigh costs and benefits to make decisions.

people are immune from emotions affecting their decisions.

decision-makers do not make mistakes when weighing costs and benefits.

labor markets are geographically segmented.

unskilled workers outnumber skilled workers.

workers specialize in various production tasks.

each worker performs a large number of tasks.

estimating the marginal costs of both products in real or physical terms.

comparing marginal benefits and marginal costs.

determining where least-cost production occurs.

calculating where economic growth will be greatest.

comes closest to using the same quantities of land, labor, capital, and entrepreneurial ability.

can be obtained for the smallest money outlay.

uses the smallest total quantity of all resources.

conserves most on the use of labor.

goods and services respectively.

incomes and consumer expenditures respectively.

consumer expenditures and income respectively.

a hypothesis.

a theory.

a principle.

a law.