Chapter 1

Question 1

———— forces us to make choices

Answer 1

Scarcity

Question 2

One day, Kiera wakes up and in frustration yells, “Decisions, decisions! Why do I have to make decisions about everything?” Kieras frustrations stem from the fact that:

Answer 2

Like all economic agents, she faces constraints and cannot have everything she wants

Question 3

Sabrina and Hayley are roommates. Sabrina hates to clean the bathroom. Hayley will agree to clean the bathroom only if Sabrina vacuums the living room. Which economic concept does this statement BEST represent?

Answer 3

There are gains from trade

Question 4

If a market is in equilibrium:

Answer 4

No individual will be better off doing something different

Question 5

Your neighbor is planting her garden one afternoon when she stops to have a beer. She drinks one glass and is now deciding whether to have a second glass. This is an example of ———- analysis.

Answer 5

Marginal

Question 6

When markets dont achieve efficiency

Answer 6

The government may intervene to improve society’s welfare

Question 7

Which question would not involve marginal analysis:

Answer 7

Should I attend the Lakers Game?

Question 8

The environmental protection agency regulates, how much pollution a factory can imagine. Which economic principle does this statement best represent?

Answer 8

When Marcus don’t achieve efficiency, government intervention can improve society’s welfare

Question 9

New Subway location has offered a prize a free meal each week for a year to its first 100 customers on opening day. Isabella camped out for 48 hours before opening to be one of the first 100 customers and successfully obtained the price. The cost is a bottle of obtaining the free meal week for a year price was:

Answer 9

Whatever else she would have done with the 48 hours

Question 10

A dozen friends get together for a bachelorette party to celebrate an upcoming wedding. If Caicos served and cut into 12 pieces of the same size and each of the 12 attendees gets a slice of the cake distribution is:

Answer 10

Equitable

Question 11

Samsung finds it difficult to hire enough skilled software engineers to program the popular galaxy cell phone which economic concept does the statement best represents

Answer 11

Scarcity

Question 12

If Isabella drives to Kansas City, 120 miles from Manhattan, Kansas to do her back to school shopping this will:

Answer 12

Hurt Isabella’s community because Isabella’s spending will be income for people in the larger city 

Question 13

We have to make choices, because:

Answer 13

The resources available to us are scarce

Question 14

What best describes efficiency?
1) a situation in which producers make the highest profits possible
2) a situation in which we cannot produce more of one good without producing less of another good.
3) a situation in which we produce the goods and services that people value most highly 

Answer 14

2 and 3

Question 15

The study of economics arises because of the necessity of choice, and the necessity of choice arises because of the fundamental problem of

Answer 15

Scarcity

Question 16

Sometimes, the government varies it’s pending, depending on the needs of the country. Which economic principle does the statement best represent?

Answer 16

Government policies can change the spending.

Question 17

Economists believe that resources should be used as efficiently as possible to:

Answer 17

Achieve societies goals

Question 18

It is cheaper to buy apples in Washington than in Texas because apples need a lot of water and a specific Climate. Which economic concept does the statement best represent?

Answer 18

Resources should be used as efficiently as possible to achieve societies goals

Question 19

Which of the following topics would be studied in macroeconomics?

Answer 19

Recessions

Question 20

Marginal analysis is the study of how individuals decide:

Answer 20

Whether to do a bit more of an activity or a bit less of it

Question 21

Individuals gains from trade, because:

Answer 21

Of specialization in production

Question 22

Well, buying refreshments for an upcoming party you notice that a six pack of bud light beer cost six dollars and that a six pack of Miller light beer cost eight dollars. You buy the six pack of Miller light beer although you wonder if maybe 26 packs of bud light beer would have been a better choice to opportunity cost of the Miller light beer is:

Answer 22

2 -6packs of Bud Light beer

Question 23

———-, that is, decisions by an individual about what to do, and what not to do, is the basis for economics.

Answer 23

Individual choice

Question 24

When the Chicago city manager received complaints that the municipal courts are not fully accessible to individuals with disabilities, she responds that the $1 million improvement needed to address. The problem will not happen because that money could have been spent building laboratory spaces for people with disabilities. Which economic principle does the statement best represent?

Answer 24

The true cost of something is opportunity cost

Question 25

If you decide to go to Daytona with your friends, during spring break, you cannot go to London with your brother in the summer. Which economic principles the statement best represent?

Answer 25

The true cost of something is its opportunity cost

Question 26

Ivanka will make $20 by working an additional hour, but she will lose an hour of studying for her economics test. Ivanka decides to study rather than work. Ivanka’s choice indicates that she:

Answer 26

Values an additional hour, studying more than $20 she would earn working

Question 27

Specialization and trade lead to:

Answer 27

An increase in total economic output

Question 28

Susan is attending university and majoring in actuarial mathematics. Susan is there by accumulating:

Answer 28

Human capital

Question 29

In a society with a Market economy, decisions made by society as a whole emerge from many individual choices. Which of the following exemplifies this phenomenon?

Answer 29

The market demand for oranges.
The volume of work performed by the American workforce
Whether affirm, is profitable enough to remain in business .

Question 30

A friend comes up to you and offers you a free ticket to the Yankees game that night, and you decide to attend the game. The game takes five hours and cost you $25 for transportation. If you have not attended the game you would have worked your part-time job for $12 an hour. What is the cost you of attending the game?

Answer 30

$85