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Assignenment Economics 124123

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19 views7 pages

Assignenment Economics 124123

Uploaded by

shehumicah6
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Assignenment – Principles of Economics

1 - Give three examples of important trade-offs that you face in your life.

2 - Why should policymakers think about incentives?

3 - What items would you include to figure out the opportunity cost of a
vacation to South Africa?

4 - The word that comes from the Greek word for “one who manages
a household” is
a. market.
b. consumer.
c. producer.
d. economy.

5 - The word economy comes from the Greek word for


a. “environment.”
b. “one who manages a household.”
c. “one who participates in a market.”
d. “conservation.”

6 - Households and economies have each of the following in common


EXCEPT both
a. must allocate scarce resources.
b. face many decisions.
c. must allocate the goods and services they produce.
d. must have a central decision maker.

7 - Economics deals primarily with the concept of


a. scarcity.
b. poverty.
c. change.
d. power.

8 - Which of the following is NOT included in the decisions that every


society must make?
a. what goods will be produced
b. who will produce goods
c. what determines consumer preferences
d. who will consume the goods

9 - Both households and societies face many decisions because


a. resources are scarce.
b. populations may increase or decrease over time.
c. wages for households and therefore society fluctuate with
business cycles.
d. people, by nature, tend to disagree.

10 - A good is considered scarce in a society when


a. more output of the good is possible.
b. everyone in that society cannot have all they want of the good.
c. the government restricts production of the good.
d. only the richest people in the economy can buy all they want of
the good.

11 - Scarcity exists when


a. there is less than an infinite amount of a resource or good.
b. society can meet the wants of every individual.
c. there is less of a good or resource available than people wish to
have.
d. the government fails to produce goods.

12 - Which of the following would NOT be true in a world without


scarcity?
a. There would be no need for the science of economics.
b. Everyone would have all the goods and services they wanted.
c. There would have to be an infinite supply of every resource.
d. There would be opportunity costs.

13 - When a society cannot produce all the goods and services people
wish to have it is said that the economy is
experiencing
a. scarcity.
b. communism.
c. externalities.
d. market failure.

14 - For society, a good is not scarce if


a. at least one individual in society can obtain all he or she wants of
the good.
b. firms are producing at full capacity.
c. all members of society can have all they want of it.
d. those who have enough income can buy all they want of the good.

15 - Which product would be considered scarce?


a. Nike shoes
b. Monet paintings
c. 1-carat diamonds
d. All of the above are correct.

16 - Which of the following goods best meets the definition of


scarcity?
a. air
b. water in the ocean
c. water in a city
d. wood in a forest

17. Economics is defined as the study of


a. business.
b. how society manages its scarce resources.
c. central planning.
d. government regulation.

18 - Economics is the study of


a. how society manages its scarce resources.
b. the government’s role in society.
c. how a market system functions.
d. how to increase production.

19 - In most societies, resources are allocated by


a. a single central planner.
b. those who own the resources.
c. those firms that use resources to provide goods and services.
d. the combined actions of millions of households and firms.

20 - Economists study all of the following EXCEPT


a. how people make decisions.
b. how people interact with one another.
c. the forces and trends that affect the economy as a whole.
d. how societies change over time.

21 - Which of the following is NOT a major area of study for


economists?
a. how people make decisions
b. how countries choose national leaders
c. how people interact with each other
d. how forces and trends affect the overall economy

22 - The adage, “There is no such thing as a free lunch,” is used to


illustrate the concept of
a. tradeoffs.
b. scarcity.
c. productivity.
d. efficiency.

23 -The adage, “There is no such thing as a free lunch,” means


a. even people on welfare have to pay for food.
b. the cost of living is always increasing.
c. to get something we like, we usually have to give up another thing
we like.
d. all costs are included in the price of a product.

24 - Economists use the phrase “There is no such thing as a free


lunch,” to illustrate
a. how inflation increases prices.
b. that to get one thing, we must give up something else.
c. that nothing is free in a market economy.
d. that if something looks too good to be true, it probably is.
25 - Which best represents the concept represented by the adage,
“There is no such thing as a free lunch”?
a. Melissa can only attend the concert if she takes her sister with her.
b. Greg is hungry and homeless.
c. Brian must repair the tire on his bike before he can ride it to class.
d. Kendra must decide between going to Colorado or Cancun for
spring break.

26 - Guns and butter are used to represent the classic societal tradeoff
between spending on
a. durable and nondurable goods.
b. imports and exports.
c. national defense and consumer goods.
d. law enforcement and agriculture.

27 - Henry decides to spend two hours playing golf rather than


working at his job which pays $8 per hour. Henry’s
tradeoff is
a. the $16 he could have earned working for two hours.
b. nothing, because he enjoys playing golf more than working.
c. the increase in skill he obtains from playing golf for those two
hours.
d. nothing, because he spent $16 for green fees to play golf.

28 - When society requires that firms reduce pollution, there is


a. a tradeoff because of reduced incomes to the firms’ owners,
workers, and customers.
b. no tradeoff, since everyone benefits from reduced pollution.
c. no tradeoff for society as a whole, since the cost of reducing
pollution falls only on the firms affected by the
requirements.
d. a tradeoff only if some firms are forced to close.

29 - Daniel decides to spend the last two hours of the night before his
economics exam studying instead of sleeping. For
Daniel, his tradeoff would be
a. nothing, since no dollar value can be put on sleep.
b. nothing, since studying would be more beneficial than sleep.
c. the six hours of sleep he could have had if he had gone to bed
before midnight.
d. the two hours of rest he would have gotten.

30 - A tradeoff exists between a clean environment and a higher level


of income in that
a. studies show that individuals with higher levels of income
actually pollute less than low-income individuals.
b. to pay for pollution clean-up, the government must increase taxes
which lowers income.
c. laws that reduce pollution raise costs of production and reduce
incomes.
d. by employing individuals to clean up pollution, employment and
income both rise.

31 - Which of the following best defines efficiency?


a. absolute fairness
b. equal distribution
c. minimum waste
d. consumer sovereignty

32 - Which of the following is true?


a. Efficiency refers to the size of the economic pie; equity refers to
how the pie is divided.
b. Fortunately, government policies are designed to promote both
equity and efficiency.
c. As long as the economic pie continually gets larger, no one will
have to go hungry.
d. Efficiency and equity can both be achieved if the economic pie is
cut into equal pieces.

33 - Efficiency means that


a. society is conserving resources in order to save them for the
future.
b. society’s goods and services are distributed fairly among society’s
members.
c. society has lessened its dependence on foreign energy sources.
d. society is getting the most it can from its scarce resources.

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