1. Refer to the above table. What is the opportunity cost of the third unit of capital goods: [removed]A) 3 units of consumer goods.
[removed]B) 4 units of consumer goods.
[removed]C) 6 units of consumer goods.
[removed]D) 5 units of consumer goods. [removed] Review 2. A society producing the right goods and right amounts is achieving: [removed]A) "least-cost" efficiency.
[removed]B) productive efficiency.
[removed]C) fuel efficiency.
[removed]D) "most-wanted" efficiency. [removed] Review 3. The term "ceteris paribus" means: [removed]A) that if event A precedes event B, A has caused B.
[removed]B) prosperity inevitably follows recession.
[removed]C) that economics deals with facts, not values.
[removed]D) other things equal. [removed] Review 4. The French term "laissez-faire" means: [removed]A) "there is no free lunch."
[removed]B) "let it be."
[removed]C) "public ownership."
[removed]D) "circular flow." [removed] Review 5. Suppose output is growing in a specific competitive industry. Which of the following most likely represents the market conditions in this industry? [removed]A) Economic profits are negative.
[removed]B) There has been decreased demand for product or service.
[removed]C) The industry is in equilibrium (settled).
[removed]D) Economic profits are positive. [removed] Review 6. Macroeconomics can best be described as the: [removed]A) analysis of how firms attempt to maximize their profits.
[removed]B) study of the large aggregates of the economy or the economy as a whole.
[removed]C) study of how supply and demand determine prices in individual markets.
[removed]D) analysis of how a consumer tries to spend income. [removed] Review 7. "Too less spending" may reduce employment because: [removed]A) of irrational behavior.
[removed]B) marginal benefit is greater than marginal cost.
[removed]C) producers respond with a lower output.
[removed]D) of lower interest rates. [removed] Review 8. Marginal means: [removed]A) usefulness.
[removed]B) satisfaction.
[removed]C) efficient.
[removed]D) additional. [removed] Review 9. Economics is a social science that studies how individuals, institutions, and society may: [removed]A) Attain a minimum level of unemployment
[removed]B) Expand the amount of productive resources available to them
[removed]C) Reduce the prices of goods and services to consumers
[removed]D) Best use scarce resources to achieve the maximum satisfaction of economic wants [removed] Review 10. Opportunity cost is best defined as: [removed]A) The time spent on an economic activity
[removed]B) Marginal cost minus marginal benefit
[removed]C) The value of the best forgone alternative
[removed]D) The money cost of an economic decision |