Question 1

Why are music,television,and movie companies concerned about their products being posted to Internet websites such as YouTube?

Accepted Answer

These companies believe that their intel...

Question 2

If additional units of a good could be produced at a constant opportunity cost,the production possibility frontier would be linear.

Accepted Answer

A) True 
 B)False

Question 3

Figure 2-1
 
-Refer to Figure 2-1. ________ is (are) inefficient in that not all resources are being used.

Accepted Answer

A)   Point A
B)   Point B
C)   Point C
D)   Points A and CE) B) and C)
F) None of the above

Question 4

Figure 2-10
 
-Refer to Figure 2-10. One segment of the circular flow diagram in the Figure shows the flow of funds from market F to economic agents G.The funds represent spending on goods and services.What is market F and who are economic agents G?

Accepted Answer

A)   F = factor markets; G = households
B)   F = product markets; G = households
C)   F = factor markets; G = firms
D)   F = product markets; G = firmsE) All of the above
F) B) and C)

Question 5

Define the term "property rights." Explain why the lack of well defined and enforceable property rights is detrimental to the smooth functioning of a market system.

Accepted Answer

The term "property rights" refers to the...

Question 6

All of the following are examples of spending on goods and services in the circular flow model except

Accepted Answer

A)   Amanda purchases a new electric guitar to pursue her hobby seriously.
B)   Chaitanya buys a new spa pedicure chair for her expanding nail salon business.
C)   Hernan buys a pizza at Papa C's.
D)   Lenny buys a new digital camera to take pictures at his son's graduation.E) None of the above
F) All of the above

Question 7

Which of the following are represented by the same flow in the circular flow model?

Accepted Answer

A)   the flow of goods and the flow of factors of production
B)   the flow of costs and the flow of revenue
C)   the flow of income earned from the sale of resources and the flow of expenditures on goods and services.
D)   the flow of income received by households and the flow of tax revenues paid by firmsE) A) and B)
F) A) and C)

Question 8

________ exists because unlimited wants exceed the limited resources available to fulfill those wants.

Accepted Answer

A)   Scarcity
B)   Productive efficiency
C)   The command economy
D)   Economic growthE) A) and C)
F) A) and D)

Question 9

If the production possibilities frontier is linear,then

Accepted Answer

A)   opportunity costs are decreasing as more of one good is produced.
B)   it is easy to efficiently produce output.
C)   opportunity costs are increasing as more of one good is produced.
D)   opportunity costs are constant as more of one good is produced.E) A) and B)
F) B) and C)

Question 10

If the opportunity cost of producing more of one good increases as more of that good is produced,then the production method is inefficient.

Accepted Answer

A) True 
 B)False

Question 11

The unattainable points in a production possibilities diagram are

Accepted Answer

A)   the points within the production possibilities frontier.
B)   the points along the production possibilities frontier.
C)   the points of the horizontal and vertical intercepts.
D)   the points outside the production possibilities frontier.E) A) and B)
F) None of the above

Question 12

Table 2-4
  
Table 2-4 shows the number of labor hours required to produce a cell phone and a board foot of lumber in Estonia and Finland.
-Refer to Table 2-4.What is Estonia's opportunity cost of producing one board foot of lumber?

Accepted Answer

A)   0.2 cell phones
B)   5 cell phones
C)   8 cell phones
D)   32 cell phonesE) B) and C)
F) A) and D)

Question 13

Table 2-1
Production Choices for Dina's Diner
 
-Refer to Table 2-1.Assume Dina's Diner only produces sliders and hot wings.A combination of 60 sliders and 50 hot wings would appear

Accepted Answer

A)   along Dina's production possibilities frontier.
B)   inside Dina's production possibilities frontier.
C)   outside Dina's production possibilities frontier.
D)   at the vertical intercept of Dina's production possibilities frontier.E) None of the above
F) C) and D)

Question 14

Figure 2-5
 
-Refer to Figure 2-5. If the economy is currently producing at point X,what is the opportunity cost of moving to point W?

Accepted Answer

A)   3 million tons of steel
B)   19 million tons of steel
C)   5 million tons of paper
D)   9 million tons of paperE) B) and D)
F) A) and D)

Question 15

Figure 2-11
 
-Refer to Figure 2-11. Which two arrows in the diagram depict the following transaction: Stanley purchases the novel,"Night of Sorrows" for his summer reading pleasure.

Accepted Answer

A)   J and M
B)   J and G
C)   K and M
D)   K and GE) B) and D)
F) A) and B)

Question 16

Figure 2-7
  
Figure 2-7 shows the production possibilities frontiers for Costa Rica and Guatemala. Each country produces two goods, pineapples and coconuts.
-Refer to Figure 2-7.What is the opportunity cost of producing 1 ton of pineapples in Costa Rica?

Accepted Answer

A)   3/8 of a ton of coconuts
B)   2/3 of a ton of coconuts
C)   1 1/2 tons of coconuts
D)   100 tons of coconutsE) None of the above
F) B) and C)

Question 17

________ a nation's production possibilities frontier represents economic growth.

Accepted Answer

A)   An outward shift of
B)   An inward shift of
C)   Moving up along
D)   Moving down alongE) A) and B)
F) All of the above

Question 18

An outward shift of a nation's production possibilities frontier can occur due to

Accepted Answer

A)   a reduction in unemployment.
B)   a natural disaster like a hurricane or bad earthquake.
C)   a change in the amounts of one good desired.
D)   an increase in the labor force.E) A) and B)
F) A) and D)

Question 19

Without technological advancement,how can a nation achieve economic growth?

Accepted Answer

A)   by producing more high-value goods and fewer low-value goods
B)   through an increase in supplies of factors of production
C)   by producing more low-value goods and fewer high-value goods
D)   by decreasing the size of the labor forceE) All of the above
F) None of the above

Question 20

Table 2-3
  
Table 2-3 shows the output per day of two gardeners, George and Jack. They can either devote their time to mowing lawns or cultivating gardens.
-Refer to Table 2-3.What is George's opportunity cost of mowing a lawn?

Accepted Answer

A)   half a garden cultivated
B)   two lawns mowed
C)   two-thirds of a garden cultivated.
D)   one and a half lawns mowedE) B) and C)
F) A) and D)

Exam 2: Trade-Offs, comparative Advantage, and the Market System

Table 2-3 Table 2-3 shows the output per day of two gardeners, George and Jack. They can either devote their time to mowing lawns or cultivating gardens. -Refer to Table 2-3.What is George's opportunity cost of mowing a lawn?

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All of the following are examples of spending on goods and services in the circular flow model except

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Without technological advancement,how can a nation achieve economic growth?

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The unattainable points in a production possibilities diagram are

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Table 2-4 Table 2-4 shows the number of labor hours required to produce a cell phone and a board foot of lumber in Estonia and Finland. -Refer to Table 2-4.What is Estonia's opportunity cost of producing one board foot of lumber?

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Table 2-1 Production Choices for Dina's Diner -Refer to Table 2-1.Assume Dina's Diner only produces sliders and hot wings.A combination of 60 sliders and 50 hot wings would appear

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________ exists because unlimited wants exceed the limited resources available to fulfill those wants.

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An outward shift of a nation's production possibilities frontier can occur due to

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Figure 2-5 -Refer to Figure 2-5. If the economy is currently producing at point X,what is the opportunity cost of moving to point W?

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Figure 2-7 Figure 2-7 shows the production possibilities frontiers for Costa Rica and Guatemala. Each country produces two goods, pineapples and coconuts. -Refer to Figure 2-7.What is the opportunity cost of producing 1 ton of pineapples in Costa Rica?

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If the production possibilities frontier is linear,then

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If additional units of a good could be produced at a constant opportunity cost,the production possibility frontier would be linear.

Correct AnswerverifiedShow Answer

If the opportunity cost of producing more of one good increases as more of that good is produced,then the production method is inefficient.

Correct AnswerverifiedShow Answer

Define the term "property rights." Explain why the lack of well defined and enforceable property rights is detrimental to the smooth functioning of a market system.

Correct AnswerverifiedThe term "property rights" refers to the...View AnswerShow Answer

Why are music,television,and movie companies concerned about their products being posted to Internet websites such as YouTube?

Correct AnswerverifiedThese companies believe that their intel...View AnswerShow Answer

________ a nation's production possibilities frontier represents economic growth.

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Figure 2-11 -Refer to Figure 2-11. Which two arrows in the diagram depict the following transaction: Stanley purchases the novel,"Night of Sorrows" for his summer reading pleasure.

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Figure 2-1 -Refer to Figure 2-1. ________ is (are) inefficient in that not all resources are being used.

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Which of the following are represented by the same flow in the circular flow model?

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Figure 2-10 -Refer to Figure 2-10. One segment of the circular flow diagram in the Figure shows the flow of funds from market F to economic agents G.The funds represent spending on goods and services.What is market F and who are economic agents G?

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The term "property rights" refers to the...
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These companies believe that their intel...
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