1. Microeconomics deals with: (Points: 3)
the working of the entire economy or large sectors of it.
economic growth.
individual units in the economy. THIS ONE I PICKED
all of the above.
2. The basic concern of economics is: (Points: 3)
to keep business firms from losing money.
to prove that capitalism is better than socialism.
to study the choices people make.
to use unlimited resources to produce goods and services to satisfy limited wants. I PICKED THIS ONE
3. When we are forced to make choices we are facing the concept of: (Points: 3)
exploitation.
efficiency.
scarcity.
the margin. I PICKED THIS ONE
4. If the state government allocates additional spending on education, the opportunity cost is: (Points: 3)
zero. I PICKED THIS ONE
The dollar amount of the additional spending.
only considered if additional taxes need to be raised to fund the spending.
measured in terms of the alternative uses for that money.
5. Which of the following principles underlie the economics of individual choices? (Points: 3)
There are gains from trade.
Markets move toward equilibrium.
People usually exploit opportunities to make themselves better off. I PICKED THIS ONE
Resources should be used as efficiently as possible to achieve society's goals.
6. Increases in total output realized when individuals specialize in particular tasks and trade are known as: (Points: 3)
the gains from trade. I PICKED THIS ONE
the profits obtained from sales of a good or service.
marginal analysis.
a tradeoff.
7. Economists believe that resources should be used as efficiently as possible to: (Points: 3)
achieve society's goals.
eliminate scarcity.
reduce inequity.
do all of the above. I PICKED THIS ONE
8. Resources are being used efficiently when: (Points: 3)
scarcity is not longer an issue.
they are also used equitably.
every opportunity to make people better off has been utilized.I USED THIS ONE
there are still gains from trade available.
9. The production possibilities curve illustrates that: (Points: 3)
the economy will automatically end up at full employment.
an economy's productive capacity increases proportionally with its population.
if all resources of an economy are being used, more of one good can be produced only if less of another good is produced. I PICKED THIS ONE
economic production possibilities have no limit.
10. When moving along a production possibilities curve, the opportunity cost to society of getting more of one good: (Points: 3)
is constant.
is measured in dollar terms.
is measured by the amount of the other good that must be given up. I PICKED THIS ONE
usually decreases.
1) I agree
2) Economics studies how LIMITED resources are used to satisfy UNLIMITED wants. Given that this isnt one of your choices, I would go with c) to study the choices people make.
3) I would go with c) we make choices because of scarcity; we cant have everything we want, so we have to make choices
4) no no no, opportunity cost of government spending is measured in terms of the NEXT BEST alternative uses for that money.
5) I agree
6) I agree
7) Hummm. Initially, I agreed. However, efficiency reduces scarcity but doesnt eliminate it. Second, equity (or inequity) is a normative concept; being efficient doesnt really address or relate to equity. Finally, societies goals is also an normative concept. Being efficient may improve the success rate on achieving societies goals, but societies goals is not the reason for being efficient. I wish none-of-the above was a possible answer.
8) I agree
9) I agree.
10) I agree
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1. Microeconomics deals with individual units in the economy. Microeconomics focuses on the behavior and decision-making of individual households, businesses, and industries. To understand microeconomics, one would need to analyze the supply and demand of specific goods and services, pricing, cost analysis, and market behavior.
2. The basic concern of economics is to use unlimited resources to produce goods and services to satisfy limited wants. Economics studies how society allocates its scarce resources among the competing wants and needs of individuals and groups. It involves analyzing and understanding the production, distribution, and consumption of goods and services.
3. When we are forced to make choices, we are facing the concept of scarcity. Scarcity refers to the limited availability of resources relative to unlimited wants and needs. Since our resources are limited, we must make choices about how to allocate them.
4. If the state government allocates additional spending on education, the opportunity cost is measured in terms of the alternative uses for that money. The opportunity cost is the value of the next best alternative forgone when making a decision. In this case, if the state government spends additional money on education, the opportunity cost would be the value of the alternative uses for that money, such as spending it on healthcare or infrastructure.
5. The principle that underlies the economics of individual choices is that people usually exploit opportunities to make themselves better off. People make choices based on their own self-interest and will usually take actions that they believe will benefit them. This principle drives individual behavior and decision-making in economic situations.
6. Increases in total output realized when individuals specialize in particular tasks and trade are known as the gains from trade. When individuals specialize in a specific task or job, they can become more efficient and productive in that area. By trading with others who have specialized in different tasks, individuals can benefit from the gains of trade, increasing overall output and efficiency.
7. Economists believe that resources should be used as efficiently as possible to achieve society's goals. Efficiency refers to using resources in the most effective way to achieve desired outcomes. By using resources efficiently, society can maximize the benefits and outcomes that can be achieved with limited resources.
8. Resources are being used efficiently when every opportunity to make people better off has been utilized. Efficiency in resource allocation means that resources have been allocated in such a way that there is no opportunity to make one person better off without making someone else worse off. It means maximizing the benefits and outcomes that can be achieved with available resources.
9. The production possibilities curve illustrates that if all resources of an economy are being used, more of one good can be produced only if less of another good is produced. The production possibilities curve illustrates the trade-offs of producing different combinations of goods and services using limited resources. It shows the maximum amount of one good that can be produced given the production level of another good, demonstrating the concept of opportunity cost and the limits of production.
10. When moving along a production possibilities curve, the opportunity cost to society of getting more of one good is measured by the amount of the other good that must be given up. As society chooses to produce more of one good, it must give up the production of another good because resources are limited. The opportunity cost of producing more of one good is the quantity of the other good that society has to forego.