Test 1

Question 1

Deiter went hungry for a month so that he could purchase a monkey. This decision is?

Answer 1

Efficient if Deiter values a monkey more than he values food for the month

Question 2

If one owns a unit of something, we measure its value by the?

Answer 2

Least one is willing to accept in order to give up the unit

Question 3

In making a policy decision, if we value life as being infinite, we would be justified in?

Answer 3

All of the above

Question 4

The cost of obtaining a college education includes?

Answer 4

Wages that must be given up while one is in class

Question 5

At an all you can eat pizzeria, you should?

Answer 5

Eat until the marginal value of pizza is zero

Question 6

Ramona’s pizza should produce the amount of pizza such that?

Answer 6

The price of pizza is equal to the marginal cost

Question 7

Which is true?

Answer 7

The market creates a job if someone thinks the value of labor is at least as great as the cost of labor in a particular use

Question 8

The supply curve is?

Answer 8

The marginal cost curve

Question 9

If Ramona’s cost of making a pizza is $9, then the minimum she would accept to make that pizza is?

Answer 9

$9

Question 10

If the price of gasoline is $3.50 and the government makes it illegal to charge more than $3.00, then?

Answer 10

There will be a shortage of gas

Question 11

You economize and seek the highest value if you spend?

Answer 11

Your money on yourself

Question 12

Friedrich Hayek said?

Answer 12

The dispute is about whether planning is done by the one or by the many

Question 13

Economists have shown that voting behavior is similar to?

Answer 13

Rooting for a sports team

Question 14

Which does not play a part in promoting special interest funding?

Answer 14

Efficiently producing valued goods

Question 15

Indirect costs of regulation include?

Answer 15

Output that is not produced because it is not profitable under the regulation

Question 16

For a company that makes both large and small cars, CAFE standards cause the social gain from production of?

Answer 16

Large cars and small cars to fall

Question 17

Which group’s supports for ethanol regulations has decreased?

Answer 17

Environmentalists

Question 18

With regulatory capture?

Answer 18

The economy is less stable

Question 19

A new federal law requires that health professionals add the names and identifications of mentally ill people to a database to prevent them from buying weapons to harm others? An unintended consequence of this law is to?

Answer 19

Fewer mentally ill people seek treatment because they do not wish to be added to a federal database, making it more likely that they will harm others

Question 20

The social losses in the gasoline industry due to the ethanol laws occur because?

Answer 20

Less gasoline is produced than without the mandate

Question 21

Money?

Answer 21

Is a means of exchanging the things that make up the true wealth of a nation

Question 22

In order to manufacture the fully functional iPhones that people use today, we need only?

Answer 22

None of the above

Question 23

Bastiat says?

Answer 23

Private firms would distribute transported grain first to areas where they could make the most profit

Question 24

We desire the economy to advance so that we can?

Answer 24

Have as much output as possible with as little effort as possible

Question 25

The production possibilities frontier model assumes that?

Answer 25

None of the above

Question 26

Because cows are better at producing milk than producing missiles, the production possibilities frontier is?

Answer 26

A bowed outward downward sloping line

Question 27

The way that an economy chooses a point on the production possibilities frontier is?

Answer 27

By consumers and producers weighing costs and values in a market economy and by command in an authoritarian economy

Question 28

Points inside the production possibilities frontier represent combinations?

Answer 28

Of goods, such that there are unemployed resources

Question 29

For individuals and for entire economies, having more income and wealth depend on having?

Answer 29

Higher quality resources

Question 30

Motivations to trade do not include?

Answer 30

Differences in the amount of money

Question 31

In order to produce 3 fish and 24 coconuts?

Answer 31

None of the above

Question 32

Because we trade for resources?

Answer 32

Consumers and producers benefit

Question 33

Bastiat’s example shows that for those who want trade surpluses, the best thing that can happen is?

Answer 33

Ships carrying exports sink

Question 34

The exchange rate is?

Answer 34

The price of one country’s currency, in terms of another

Question 35

Helena exports her music all around the globe. She prefers?

Answer 35

A weak dollar

Question 36

In Bastiat’s story of Mr. Protectionist, who is the enemy?

Answer 36

French blacksmiths

Question 37

When we place an import quota on a good?

Answer 37

Domestic consumers lose and there is an overall loss to society

Question 38

In Petition of the Candlemakers, Bastiat describes a foreign competitor?

Answer 38

That will never import anything from us