To correct for inflation, GDP numbers must be converted using the price level in a given year known

1)To correct for inflation, GDP numbers must be converted using the price level in a given year known as the

Answer



Base year



Real year



Current year



Constant year



Inflation year



2) A production possibilities curve represents all of an economy's combinations for production that are

Answer



Unattainable



Possible and Efficient



Attainable



Inefficient



Desirable

Question 3

Which of the following is a technique used to determine the optimal level of an economic activity?

Answer



Cost/benefit analysis



Production possibilities curve analysis



GDP analysis



Opportunity cost analysis

Question 4

The bow shape of the production possibilities curve reflects

Answer



The opportunity cost concept



The concept of increasing opportunity costs



The concept of diminishing marginal returns



The marginal social cost/marginal social benefit principle

Question 5

Real per capita GDP is defined as

Answer



Population/real GDP



GDP/population



Real GDP/price index



Real GDP/population



Price index/GDP

Question 6

Marginal social cost refers to the

Answer



Cost incurred due to an action undertaken by society



Total expenditures by society on a good like a public park



Cost borne by society when 1 more unit of a good is produced



Cost to society of sub-standard production



Cost to society when an additional unit of a social good is produced

Question 7

If population in a country falls while GDP stays the same, the country's

Answer



Real GDP falls



Real GDP rises



Per capita GDP rises



Per capita GDP falls



Welfare falls

Question 8

With private property rights, the decision about how to use resources are made by

Answer



The government



Private firms



Individual resource owners



Resource committees

Question 9

The know-how and the means and methods of production available in an economy are known as

Answer



Technology



Capital



Human capital



Labor



Management

Question 10

The purpose of a base year when constructing a price index is:

Answer



Showing how the output values rise from year to year



Encourage inflation



Providing a means to compare the economy's output across different time periods



To show why expenditures on government goods and services need to increase



Indicate the progress in keeping prices low

Question 11

Economic reasoning would not be necessary if

Answer



Our wants were limited



Resources were expansive



Scarcity were decreased



We could have everything we wanted



Politicians were better at running the economy

Question 12

The fundamental economic problem involves

Answer



Overpopulation



Inflation and unemployment



Scarce resources and unlimited wants



Cheap foreign labor



Supply and demand

Question 13

Labor resources include

Answer



The equipment workers use to complete their work



Only non-management personnel



Any efforts of a person to produce goods



Only the physical efforts of an economy's people

Question 14



A country can shift out its production possibilities curve by

Answer



Improving its technology



Shifting its production from one good to another



Experiencing a population drop



Using its farmland more productively

Question 15

The means for satisfying wants are

Answer



Insatiable



Unlimited



Infinite



Scarce



Unavailable