Quiz
Economics Midterm
Create a free account to finish this quiz
Save your progress and see your final score.
Already have an account? Sign in
Questions in this quiz (54)
1As depicted in _________________________________, it is necessary to give up some of one good to gain more of the other good.
- Athe production possibilities frontier
- Ballocative efficiency
- Cscarcity
- Dutility
2Refer to Figure 2-1. An economy is operating at full employment, and then workers in the bread industry are laid off. This change is portrayed in the movement from
- AA to B
- BB to E
- CC to F
- DG to F
3Refer to Figure 2-1. Along the production possibilities frontier, the most efficient point of production depicted is:
- APoint B
- BPoint C
- CPoint D
- DAll points of the production possibilities frontier are equally efficient.
4Refer to Figure 2-1. The most inefficient point depicted is:
- APoint A
- BPoint C
- CPoint D
- DPoint G
5Scarcity implies that:
- Aconsumers would be willing to purchase the same quantity of a good at a higher price.
- Bit is impossible to completely fulfill the unlimited human desire for goods and services with the limited resources available.
- Cat the current market price, consumers are willing to purchase more of a good than suppliers are willing to produce.
- Dconsumers are too poor to afford the goods and services available.
6Gomer decides to spend an hour playing basketball rather than studying. His opportunity cost is:
- Anothing, because he enjoys playing basketball more than studying.
- Bthe increase in skill he obtains from playing basketball for that hour.
- Cthe benefit to his grades from studying for an hour
- Dnothing, because he had a free pass into the sports complex to play basketball.
7"If I didn't have class tonight, I would save the $4 campus parking fee and spend four hours at work where I earn $10 per hour." The opportunity cost of attending class this evening is:
- A$0
- B$4
- C$40
- D$44
8 The opportunity cost of attending university is likely to include all except which of the following?
- Athe cost of haircuts received during the school term
- Bthe income you forgo in order to attend classes
- Ctuition fees
- Dthe cost of required textbooks
9Referring to Table 2-1: A student has only a few hours to prepare for two different exams this afternoon. The above table shows alternative possible exam scores with three alternative uses of the student's time. The opportunity cost of scoring a 94 on the economics exam rather than a 77 is:
- A8 points on the history exam
- B15 points on the history exam
- C14 points on the history exam
- D17 points on the history exam
10Refer to Table 2-1. A student has only a few hours to prepare for two different exams tomorrow morning. The above table shows alternative possible exam outcomes with three alternative uses of the student's time. The opportunity cost of scoring an 84 on the history exam rather than 76 is:
- A10 points on the economics exam
- B8 points on the history exam
- C7 points on the economics exam
- D12 points on the economics exam
11The leader of a federal political party made the following campaign promise: "My administration will increase national defense without requiring sacrifices elsewhere in the economy. " The promise can be kept if:
- Athe economy moves along the production possibilities in the direction of a greater quantity of defense.
- Bthe economy moves from a point inside the production possibilities curve toward a point on the production possibilities curve.
- Cthe production possibilities frontier shifts outward due to an improvement in technology.
- Deither b) or c) occurs, but not as a result of a).
12Refer to Figure 2-2. At Point A in the production possibilities graph shown above, the economy:
- Ais not using its resources efficiently
- Bis using its resources efficiently while producing clothing but no food.
- Cis using its resources efficiently while producing food but no clothing.
- Dis using its resources efficiently to producing both food and clothing.
13Refer to Figure 2-2. When the economy moves from Point A to Point B in the diagram above:
- Athe economy begins using its resources efficiently to produce both food and clothing.
- Bthe economy operates at its productive capacity once it reaches Point B.
- Cthe economy increases production of both clothing and food.
- DAll of the above occur
14The nature of demand indicates that as the price of a good increases:
- Asuppliers wish to sell less of it.
- Bmore of it is produced.
- Cmore of it is desired.
- Dbuyers desire to purchase less of it.
15A supply curve is a graphical illustration of the relationship between price, shown on the vertical axis, and _________________, shown on the horizontal axis.
- Ademand
- Bquantity
- Cquantity supplied
- Dquantity demanded
16In economics, the demand for a good refers to the amount of the good that people:
- Awould like to have if the good were free.
- Bwill buy at various prices.
- Cneed to achieve a minimum standard of living.
- Dwill buy at alternative income levels.
17The demand curve for a typical good has a(n):
- Anegative slope because some consumers switch to other goods as the price rises.
- Bnegative slope because consumer incomes fall as the price of the good rises.
- Cnegative slope because the good has less "snob appeal" as its price falls.
- Dinverse slope because as the price goes up, the good has more profitability.
18The _________ is the only price where quantity demanded is equal to quantity supplied.
- Aequilibrium price
- Bhorizontal axis intercept
- Cvertical axis intercept
- Dmarket price
19After widespread press reports about the dangers of contracting "mad cow disease" by consuming beef from Canada, the likely economic effect on the U.S. demand curve for beef from Canada is:
- Ano change; only the supply curve for beef is likely to be affected.
- Ba shift of the demand curve for beef to the left.
- Ca movement down along the demand curve for beef to the right.
- Da shift of the demand curve for beef to the right.
20Refer to Figure 3-1. Using the graph above and beginning on D1, a shift to D2 would indicate a(n):
- Aincrease in quantity demanded.
- Bdecrease in quantity demanded.
- Cincrease in demand.
- Ddecrease in quantity demand.
21Refer to Figure 3-2. A change from Point A to Point B represents a(n):
- Aincrease in demand
- Bdecrease in demand
- Cdecrease in quantity demanded
- Dincrease in quantity demanded
22If new manufacturers enter the computer industry, then (ceteris paribus):
- Athe supply curve shifts to the left
- Bthe supply curve shifts to the right
- Cthe demand curve shifts to the left
- Dsome established manufacturers must exit the industry
23If a firm faces _____________________, while the prices for the output the firm produces remain unchanged, a firm’s profits will increase.
- Ahigher demand
- Blower costs of production
- Cequilibrium
- Da shift in demand
24When __________________, a firm will supply a higher quantity at any given price for its output, and the supply curve will shift to the right.
- Aprices rise
- Bequilibrium is achieved
- Ccosts of production fall
- Dthere is a population increase
25A severe freeze has once again damaged the Florida orange crop. The impact on the market for orange juice will be a leftward shift of:
- Athe supply curve
- Bthe demand curve, as consumers try to economize because of the shortage.
- Cboth the supply and demand curves.
- Dthe supply curve and a rightward shift of the demand curve, resulting in a higher equilibrium price.
26Refer to Figure 3-3. A change from Point A to Point E represents a(n):
- Aincrease in supply
- Bdecrease in supply
- Cincrease in quantity supplied
- Ddecrease in quantity supplied
27Refer to Figure 3-3. A change from Point A to Point E represents a(n):
- Aincrease in supply
- Bdecrease in supply
- Cincrease in quantity supplied
- Ddecrease in quantity supplied
28 Refer to Figure 3-3. A change from Point A to Point D represents a(n):
- Adecrease in quantity supplied.
- Bincrease in quantity supplied.
- Cdecrease in supply.
- Dincrease in supply.
29Refer to Figure 3-3. A change from Point A to Point B represents a(n):
- Aincrease in supply.
- Bdecrease in supply.
- Cincrease in quantity supplied.
- Ddecrease in quantity supplied.
30A drought decreases the supply of agricultural products, which means that at any given price a lower quantity will be supplied; conversely, especially good weather would shift the _________________________.
- Ademand curve to the right
- Bsupply curve to the left
- Csupply curve to the right
- Ddemand curve to the left
31According to the law of supply:
- Athere is a direct relationship between price and the quantity supplied.
- Bthere is an inverse relationship between price and the quantity supplied.
- Cthere is a direct relationship between price and quantity demanded.
- Dthere is an inverse relationship between price and quantity demanded.
32Which of the following would reduce the supply of microcomputers?
- Aa technological improvement that lowers the cost of producing the computers
- Bhigher wage rates for the workers that assemble the computers
- Ca reduction in the price of computer chips used to produce the computers
- Da reduction in the price of computers.
33Interpret the following statement: "An increase in the price of wheat will encourage farmers to increase the quantity of wheat supplied to the market."
- AThe statement is correct.
- BThe statement would be correct if "quantity of wheat demanded" were substituted for "quantity of wheat supplied."
- CThe statement is incorrect because it confuses a change in quantity supplied with a change in supply.
- DThe statement would be correct if it read that a "decrease in the price of wheat will encourage farmers to increase the quantity of wheat supplied to the market."
34Andy views beer and pizza as complements to one another. If the price of pizza decreases, economists would expect:
- AAndy's demand for pizza to increase.
- BAndy's demand for pizza to decrease.
- CAndy's quantity of pizza demanded to decrease.
- DAndy's demand for beer to increase.
35GDP is:
- Athe sum of all currency and coins in circulation.
- Bthe value of all final goods and services produced by a government.
- Cthe value of all final goods and services produced anywhere in the world by a nation's firms.
- Dthe value of all final goods and services produced domestically.
36Final goods or services used to compute GDP refer to:
- Athe sum of all wages paid to laborers.
- Bthe factors of production used to produce output.
- Cgoods and services purchased by the ultimate users.
- Dthe value of outstanding shares of stock of manufacturing firms.
37Consumption is the purchase of goods and services by:
- Ahouseholds
- Bgovernment
- Cbusiness firms
- Dforeign buyers
38Gross Domestic Product equals $1.2 trillion. If consumption equals $690 billion, investment equals $200 billion, and government spending equals $260 billion, then:
- Aexports exceed imports by $50 billion.
- Bimports exceed exports by $50 billion.
- Cimports exceed exports by $150 billion.
- Dexports exceed imports by $150 billion.
39In order to avoid double counting, statisticians just count the __________________.
- Afinal inventories
- Bfinal goods and services
- Cintermediate goods and services
- Ddurable goods and nondurable goods
40Which of the following is included in the calculated Gross Domestic Product?
- AFarmer Freddie sells his second tractor to his son.
- BSuzanne buys a love seat and chair for $85 at the yard sale on the corner.
- CA local ice cream store sells $17,000 worth of cones and sundaes on July 1.
- DMr. Farkle buys a used lawn mower from his neighbor, Mr. Sparkle.
41Which of the following is not counted as a part of GDP?
- Athe purchase of 100 shares of AT&T stock by your grandfather.
- Bthe purchase of a snow plough by the city of Minneapolis.
- Cthe unsold additions to inventory at an appliances store
- Dthe purchase of a loaf of bread by a consumer
42Which of the following is not included in GDP?
- Athe payments for a chiropractor's services
- Bcash income paid to a day laborer that is not reported to the tax authorities
- Cthe replacement of brake pads on your six-year-old vehicle
- Dthe fees for legal services rendered by your lawyer
43Which of the following is included in GDP calculations?
- Asales revenue received from a yard sale
- Bcash income received by a self-employed landscaper that is not reported to the IRS
- Ca crisp $50 bill received on your birthday
- Dthe university tuition paid to enroll in a course
44Which of the following is included in GDP?
- Arevenue from the sale of a three-year old car
- Bthe fees charged for a stock broker's services
- Cthe receipts from a sale of land
- Dthe value of lawn care service provided by a sixteen-year-old as part of his weekly chores
45Investment (I) includes:
- Athe amount spent on new factories and machinery.
- Bthe amount spent on stocks and bonds.
- Cthe amount spent on consumer goods that last more than one year.
- Dthe amount spent on purchases of art.
46A business cycle reflects changes in economic activity, particularly real GDP. The stages of a business cycle are:
- Atrough, expansion, recession, peak
- Bcontraction, recession, expansion, boom
- Cexpansion, trough, recession, peak
- Dexpansion, peak, recession, trough
47Which of the following is true?
- AA depression is a recession that is mild and relatively brief.
- BThe expansions and contractions of real world business cycles last varying lengths of time and often differ in magnitude.
- CThe timing of business fluctuations is regular and therefore easily predictable.
- DDuring the contractionary phase of the business cycle, the rate of unemployment is generally quite low.
48If imports exceed exports, as in recent years, then __________ exists.
- Aa trade surplus
- Ba trade deficit
- Ca trade imbalance
- Da trade disequilibrium
49In 1980 Denmark had a GDP of $70 billion (measured in U.S. dollars) and a population of 5.1 million. In 2000, Denmark had a GDP of $160 billion (measured in U.S. dollars) s and a population of 5.3 million. By what percentage did Denmark’s GDP per capita rise between 1980 and 2000?
- A45.4%
- B219%
- C128%
- D120%
50 India has a GDP of 23,000 billion Indian rupees, and a population of 1.1 billion. The exchange rate is 50 rupees per U.S. dollar. Calculate the GDP per capita of India as measured in U.S. dollars.
- A$20.90
- B$20,909
- C$418
- D$4.18
51Ethiopia has a GDP of $8 billion (measured in U.S. dollars) and a population of 55 million. Costa Rica has a GDP of $9 billion (measured in U.S. dollars) and a population of 4 million. Calculate per capita GDP for each country.
- AEthiopia = $14.50 Costa Rica = $2250.00
- BEthiopia = $14.50 Costa Rica = $225.00
- CEthiopia = $145.00 Costa Rica = $2250.00
- DEthiopia = $1450.00 Costa Rica = $22,500.00
52The gap between exports and imports in a nation's economy is called the ___________.
- Atrade surplus
- Btrade balance
- Ctrade deficit
- Dtrade inventory
53_______________, which can be approximated by the growth of gross domestic product, ultimately determines the prevailing standard of living in a country.
- ATrade balance
- BInflation
- CEducation
- DEconomic growth
54The nominal value of any economic statistic refers to the number that is actually announced at that time, while the ________________ refers to the statistic after it has been adjusted for inflation.
- Aempirical value
- Badjusted value
- Creal value
- Dnet value
Information
- Description
- College Economics Quiz on Economics Midterm, created by Maddy Zych on 08/12/2020.
- Author
- Maddy Zych
- Language
- English
- Views
- 4
- Tags
- Rating
- No ratings yet Rate this quiz