Microeconomics Midterm Review

Question 1 of 12

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In economics, scarcity means that:

Select one of the following:

  • A shortage of a particular good will cause the price to fall.

  • A production-possibilities curve cannot accurately represent the tradeoff between two goods.

  • Society's desires exceed the want-satisfying capability of the resources available to satisfy those desires.

  • The market mechanism has failed.

Question 2 of 12

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Given that resources are scarce:

Select one of the following:

  • A "free lunch" is possible but only for a limited number of people.

  • Opportunity costs are experienced whenever choices are made.

  • Poor countries must make choices but rich countries with abundant resources do not have to make choices.

  • Some choices involve opportunity costs while other choices do not.

Question 3 of 12

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A consequence of the economic problem of scarcity is that:

Select one of the following:

  • Choices have to be made about how resources are used.

  • There is never too much of any good or service produced.

  • The production of goods and services must be controlled by the government.

  • The production-possibilities curve is bowed outward.

Question 4 of 12

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The basic factors of production include:

Select one or more of the following:

  • Land

  • Labor

  • Money

  • Entrepeneurship

  • Capital

  • Inputs

Question 5 of 12

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Economics can be defined as the study of:

Select one of the following:

  • For whom resources are allocated to increase efficiency.

  • How society spends the income of individuals.

  • How scarce resources are allocated to best meet society's goals.

  • What scarce resources are used to produce goods and services.

Question 6 of 12

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Opportunity cost is:

Select one of the following:

  • Only measured in dollars and cents.

  • The dollar cost to society of producing the goods.

  • The difficulty associated with using one good in place of another.

  • The alternative that must be given up in order to get something else.

Question 7 of 12

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A production-possibilities curve indicates the:

Select one of the following:

  • Combinations of goods and services an economy is actually producing.

  • Maximum combinations of goods and services an economy can produce given its available resources and technology.

  • Maximum combinations of goods and services an economy can produce given unlimited resources.

  • Average combinations of goods and services an economy can produce given its available resources and technology.

Question 8 of 12

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Which of the following is an assumption under which the production-possibilities curve is drawn?

Select one of the following:

  • There is significant unemployment.

  • The supply of factors of production is fixed.

  • The price level is changing.

  • Technology is changing.

Question 9 of 12

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According to the law of increasing opportunity costs:

Select one of the following:

  • The more one is willing to pay for resources, the larger will be the possible level of production.

  • Increasing the production of a particular good will cause the price of the good to rise.

  • In order to produce additional units of a particular good, it is necessary for society to sacrifice increa

  • Only by keeping production constant can rising prices be avoided.

Question 10 of 12

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If Korea is currently producing at efficiency, and it proceeds to increase the size of its military, then, as long as nothing else changes, its:

Select one of the following:

  • Production-Possibilities curve will shift outward.

  • Production-possibilities curve will shift inward.

  • Production of non military goods wll increase

  • Production of non military goods will decrease.

Question 11 of 12

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Which of the following is true when an economy is producing efficiently?

Select one of the following:

  • The economy is producing on the production-possibilities curve.

  • Goods and services are being produced using the fewest resources.

  • The economy is getting the most goods and services from the available resources.

  • All of the above.

Question 12 of 12

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Which of the following will cause the production-possibilities curve to shift inward?

Select one of the following:

  • An increase in population.

  • A technological advance.

  • A decrease in the size of the labor force

  • An increase in knowledge.

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Microeconomics Midterm Review

nathanbatey
Quiz by , created almost 3 years ago

Quiz on Microeconomics Midterm Review, created by nathanbatey on 26/02/2014.

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nathanbatey
Created by nathanbatey almost 3 years ago
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