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ECON 2301 Exam 1 Review - BARNETT Sp 25 Flashcards | StudBud
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ECON 2301 Exam 1 Review - BARNETT Sp 25
ECON 2301 Exam 1 Review - BARNETT Sp 25
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1
The willingness and ability of buyers to purchase different quantities of a good at different prices
supply
demand
2
What is this an image of?
Production Possibilities Frontier with increasing opportunity costs.
Production Possibilities Frontier with constant opportunity costs
3
A downward-sloping curve that is bowed outward representing increasing opportunity costs portrays a
Production Possibility Frontier with increasing opportunity costs.
Production Possibility Frontier with constant opportunity costs.
4
If increasingly more units of good Y must be given up as more units of good X are produced then
the PPF is a straight downward sloping line.
the PPF is a downward-sloping curve that is bowed outward.
5
Positive statements
describe the world as it is.
describe the world as it should be.
6
An economy where things are done the same as they have always been done.
Command economy
Market-oriented economy
Traditional economy
7
When the mix of goods produced represents the mix that society desires.
allocative efficiency
productive inefficiency
productive efficient
8
Points that lie inside the PPF are
Unattainable
Attainable but productive inefficient
productive efficient
9
A change in supply means
a shift of the entire supply curve
movement up and down the same supply curve
10
Whenever demand changes, whenever supply changes or whenever both supply and demand change:
Equilibrium price and quantity can change
The Production Possibilities Frontier can shift
11
A(n) _______ good is one in which as income rises or falls, there is no change in the demand.
normal
inferior
neutral
12
A change in quantity supplied indicates movement from
one point to another on the same supply curve caused by a change in price.
one point to another on the same demand curve caused by a change in price.
13
One has a comparative advantage when they can produce a product at a(n) _____opportunity cost.
lower
increasing
14
Which of the following is not one of the four broad categories of resources?
capital
government
labor
land
15
When producing a good or service, work is divided into a number of tasks that are performed by different workers.
Microeconomics
Sunk costs
Division of labor
16
For many goods, as the level of production increases, the average cost per unit declines
marginal analysis
law of demand
economies of scale
17
If Max's demand for hot dogs falls as his income rises, then for Max hot dogs are
an inferior good
a normal good
18
Three main goals of a healthy macroeconomy are:
Price stability, Full employment and Stock market stability
Price stability, Full employment , Economic growth
19
At a price below the equilibrium price, there is
a shortage
a surplus
20
Most decisions about what to produce, how to produce and for whom to produce are made by buyers and sellers.
Market-oriented economy
Command Economy
Traditional economy
21
To an economist, utility means:
satisfaction
marginal
additional
22
The law of demand states that price and ____________ are ___________ related,
ceteris paribus.
quantity demanded ; directly
quantity demanded ; inversely
23
As a person receives more of a good, the additional utility from each additional unit of the good declines
Law of diminishing marginal returns
Law of diminishing marginal utility
24
Macroeconomics deals with
individual industries in a market economy
the entire economy
25
What can change Equilibrium Price and Quantity?
a change in sunk cost
a change in supply, demand or both supply & demand
26
A change in Demand means
a change in quantity supplied caused by a change in price
a shift of the entire demand curve
27
The government makes most economic decisions, or at least strongly influences how decisions are made.
Command economy
market oriented economy
28
A productive efficient society
produces at a point on its PPF
can produce unlimited amounts of a good.
29
The willingness and ability of sellers to produce and offer to sell different quantities of a good at different prices
supply
demand
30
Resources, Alternate Goods, Technology, Number of Sellers, Expectations, Subsidies & Taxes are
Supply Curve Shifters
Demand Curve Shifters
31
Basically, division of labor and specialization can
lead to a decrease in overall production
lead to an increase in overall production
32
The law of supply states that price and quantity supplied are
directly related, ceteris paribus.
inversely related, ceteris paribus.
33
The study of how humans make decisions when faced with scarcity
Marginal Analysis
Economics
34
As additional increments of resources to producing a good or service are added, the marginal benefit will decline
Law of dimishing marginal utility
Law of diminishing marginal returns
35
Adam Smith's concept that individuals self-interested behavior can lead to positive social outcomes
Invisible hand
Law of supply
Ceteris Paribus
36
The synonym economists commonly use for additional is
rational.
marginal.
economic.
capital.
37
A change in quantity demanded indicates a movement from
one point to another on the same demand curve caused by a change in price
one point to another on the same supply curve caused by a change in price
38
Which of the following will
not
shift a supply curve?
a change in the good's own price
a change in the price of relevant resources
39
Is it possible for a country to produce beyond it's PPF?
yes
no
40
On a supply-and-demand diagram, equilibrium is found
where the demand curve intercepts the horizontal axis.
where the demand and supply curves intersect.
41
_________________ describe the world as it should be
Positive Statements
Normative Statements
42
A Production Possibilities Frontier Graph for Constant Opportunity Cost is
a bowed out downward sloping curve.
a bowed out upward sloping curve.
a downward sloping straight line
43
Entrepreneurship is
skill in influencing government regulators.
the talent for organizing the use of land, labor and capital.
44
Opportunity cost is the value of
all forfeited alternatives.
the best (or most highly valued) forfeited alternative.
45
Diagram that shows productively efficient combinations of two products that an economy can produce given the resources
Production Possibilities Frontier
Equilibrium
46
Heavily regulated economies often have
black markets
no government interference
47
Points that lie inside (or below) the PPF are
attainable and productive efficient.
attainable but productive inefficient.
48
A "decrease in demand" means that
price declined and consumers want to purchase more.
the demand curve has shifted to the left.
49
At a price above the equilibrium price, there is
a shortage
a surplus
50
The value of the next best alternative
Opportunity Cost
Alternate good's price
51
A person has a comparative advantage in the production of a good when
when they can produce the product at a higher opportunity cost.
when they can produce the product at a lower opportunity cost.
52
Preferences, Related Goods, Income, Market Size and Expectations of Future Price are
Demand Curve Shifters
Supply Curve Shifters
53
Scarcity is defined as the condition in which
wants are unlimited and resources limited.
both wants and resources are limited.
54
The lesson of sunk costs is to forget about the money that’s irretrievably gone and instead to focus on
how to increase demand for your product
the additional costs and benefits of future options
55
Which of the following pairs of goods would be most likely to be complements?
flashlights and batteries
coke and pepsi
peanuts and peanut butter
56
What does it mean if a person makes a "decision at the margin"?
The person compares additional benefits and additional costs
The person compares marginal benefits and total costs .
57
________________________ helps to explain the law of demand.
The Law of Dimishing marginal returns
The Law of Diminishing marginal utility
58
It is possible for a country to
consume
beyond it's PPF with specialization and trade.
False
True
59
The higher the opportunity cost of attending college
the more likely an individual will go to college
the less likely an individual will go to college.
60
When workers focus on a particular task for which they are better suited
Marginal Analysis
Specialization
61
1.
What does Ceteris Paribus mean?
All other variables held constant or nothing else changes.
The science of scarcity.
62
For many goods, as the level of production increases, the average cost of producing each individual unit declines
Sunk costs
Economies of scale
63
At Points that lie inside (or below) the PPF, society
does not produce the maximum output with its given resources
cannot produce more of a good without giving up some of another good.
64
The physical and mental talents people bring to production process comprise the resource
labor
entrepreneurship
natural resources
capital
