Lackawanna ECO105 2022 February Module 2 Quiz Latest

ECO105 Macroeconomics

Module 2 Quiz  

Question 1Because people's wants are unlimited but resources are scarce,

  there will be more services produced than goods

  choices must be made

  poor people never get anything they want

  only the rich get everything they want

 Question 2The problem of scarce resources

  is that there are not enough resources to satisfy people's unlimited wants

  means that in some cities there are not enough jobs

  is that resources are used inefficiently

  could be solved if the unemployment rate fell

 Question 3Economics is best defined as the study of how

  individuals decide to use scarce resources in an attempt to satisfy their unlimited wants

  to make money

  to eliminate the problem of scarce resources

  the government should deal with unemployment and inflation

 Question 4In economics, capital is defined as

  natural resources, such as water, oil, and iron ore

  the natural, unskilled abilities of people

  money and other financial assets

  human creations used in the production process

 Question 5Economists classify all of the following as capital, except one. Which one is not capital?

  a plumber's wrench

  a railroad car

  a $20 bill in a firm's petty cash drawer

  the building where our economics class meets

 Question 6If a business produces and sells only one unit of a good, its profit would be the

  price received for the good

  wages paid for the labor used to produce the product minus the price

  price of the product minus the cost of the resources used to produce the product

  return paid to the firm's bank on its outstanding loans

 Question 7The difference between a good and a service is that

  a services is available in unlimited quantities; a good is not

  a service helps satisfy unlimited wants; a good does not

  a good is tangible; a service is not

  a good helps satisfy unlimited wants; a service does not

 Question 8Which of the four types of decision makers in the U.S. economyplays the largest role?

  U.S. firms and government because they produce the products that households consume

  U.S. households, as buyers in product markets and sellers in resource markets

  U.S. firms and government because they create employment for domestic households and produce goods and services

  U.S. households because they supply goods to the product markets and are demanders in resource markets

 Question 9A market

  facilitates exchanges between buyers and sellers

  typically involves monetary transactions

  is often a physical place

  all of the above

 Question 10In economics, the term "marginal" usually refers to

  an all-or-nothing economic decision

  a low-quality product or resource

  a small change in an economic variable

  an unimportant and irrelevant economic variable

 Question 11Opportunity cost exists because

  the law of comparative advantage is working

  the value of lost opportunities varies from person to person

  resources are scarce but wants are unlimited

  technology is fixed at any point in time

 Question 12The cost of attending college

  is entirely monetary and consists of expenditures on tuition, books, transportation, and meals

  is negligible for most people, because they really have no choice but to attend college

  is the most valued alternative given up to attend college

  is the same whether you attend a public or a private college

 Question 13Expenses for room and board

  are not usually part of the opportunity cost of attending college, because you would have to live somewhere and eat something even if you didn't attend college

  are opportunity costs of attending college, because they are subsidized by the government or by the college

  are opportunity costs of attending college if you are on scholarship, but not otherwise

  are opportunity costs of attending college since they involve cash expenditures

 Question 14Comparative advantage is

  the ability of an individual to produce a good at a lower opportunity cost than some other individual can

  the ability of an individual to specialize and produce a greater amount of some good than can another individual

  an expression for the amount of labor a particular individual needs to produce a fixed amount of capital goods

  the number of units of one good given up in order to acquire something

 Question 15A country has an absolute advantage in the production of a good if that country

  has the greatest opportunity cost of producing the good and produces it with the fewest resources

  can produce the good using fewer resources than another country would require

  has the greatest opportunity cost of producing the good regardless of whether it is produced with the fewest resources

  has the lowest opportunity cost of producing the good and can produce it with the fewest resources

 Question 16If I trade a ginger snap for a chocolate chip cookie, I am engaging in

  comparative advantage

  privatization

  barter

  absolute advantage

 Question 17Money facilitates trade because

  it eliminates the need for specialization

  division of labor allows money to be produced at a lower cost

  it prevents people from taking advantage of each other

  it serves as a medium of exchange

 Question 18Division of labor increases productivity because

  tasks can be assigned according to individual tastes and abilities

  workers who repeatedly perform the same tasks become bored

  managers can force workers to produce goods that are valued more highly than the costs of producing them.

  specialization of labor allows for the introduction of cheaper, less sophisticated production techniques

 Question 19In economics, specialization means

  producing something using only one type of labor

  producing only one unit of output

  producing something using only one unit of a variable resource

  focusing efforts on a particular product or a single task

 Question 20"Efficiency" refers to

  producing as far inside the production possibilities frontier as possible

  producing only one out of many possible commodities

  getting the maximum possible output from available resources

  producing output using the least amount of capital