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1 | |
Economics is the study of |
|
| | A) | production technology |
| | B) | consumption decisions |
| | C) | how society decides what, how, and for whom to produce |
| | D) | the best way to run society |
|
2 | |
The law of diminishing returns says that each extra worker adds ___________ to output than the previous extra worker ___________ |
|
| | A) | less, added |
| | B) | more, subtracted |
| | C) | less, subtracted |
| | D) | more, added |
|
3 | |
The opportunity cost of a good is |
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| | A) | the time lost in finding it |
| | B) | the quantity of other goods sacrificed to get another unit of that good |
| | C) | the expenditure on the good |
| | D) | the loss of interest in using savings |
|
4 | |
Production efficiency is when ________ output of one good can be achieved for _________ of another |
|
| | A) | more, less |
| | B) | more, more |
| | C) | less, more |
| | D) | less, less |
|
5 | |
A market can accurately be described as |
|
| | A) | a place to buy things |
| | B) | a place to sell things |
| | C) | the process by which prices adjust to reconcile the allocation of resources |
| | D) | a place where buyers and sellers meet |
|
6 | |
In a free market __________ ___________ |
|
| | A) | governments intervene |
| | B) | governments plan production |
| | C) | governments interfere |
| | D) | governments do not intervene |
|
7 | |
In the mixed economy |
|
| | A) | economic problems are solved by the government and market |
| | B) | economic decisions are made by the private sector and free market |
| | C) | economic allocation is achieved by the invisible hand |
| | D) | economic questions are solved by government departments |
|
8 | |
Normative economics forms ___________ based on _____________ |
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| | A) | positive statements, facts |
| | B) | opinions, personal values |
| | C) | positive statements, values |
| | D) | opinions, facts |
|
9 | |
A resource is scarce if supply exceeds demand at zero price |
|
| | A) | TRUE |
| | B) | FALSE |
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10 | |
The area to the right of the production possibility frontier is achievable |
|
| | A) | TRUE |
| | B) | FALSE |
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11 | |
A command economy decides resource allocation by government planning |
|
| | A) | TRUE |
| | B) | FALSE |
|
12 | |
Positive economics studies objective explanations of the workings of the economy |
|
| | A) | TRUE |
| | B) | FALSE |
2002 A McGraw-Hill Online Learning Centre