Question 1

Which of the following is not an example of scarcity?

Accepted Answer

A)   Only some people can afford to buy a Ferrari.
B)   Every individual in society cannot attain the highest standard of living to which he or she might aspire.
C)   Doug has an unlimited supply of apples in his orchard.
D)   Each member of a household cannot get everything he or she wants.E) B) and C)
F) C) and D)

Question 2

Communist countries worked under the premise that

Accepted Answer

A)   markets were the best way to organize economic activity.
B)   central planners were in the best position to determine the allocation of scarce resources in the economy.
C)   households and firms,guided by an "invisible hand," could achieve the most efficient allocation of scarce resources.
D)   allowing the market forces of supply and demand to operate with no government intervention would achieve the most efficient allocation of scarce resources.E) B) and D)
F) A) and C)

Question 3

What is the most important factor that explains differences in living standards across countries?

Accepted Answer

A)   the quantity of money
B)   the level of unemployment
C)   productivity
D)   equalityE) B) and C)
F) A) and B)

Question 4

The invisible hand's ability to coordinate the decisions of the firms and households in the economy can be hindered by

Accepted Answer

A)   government actions that distort prices.
B)   increased competition in markets.
C)   enforcement of property rights.
D)   too much attention paid to efficiency.E) B) and C)
F) A) and B)

Question 5

Scenario 1-1
You have the afternoon free.You have a choice between going to the movies with a friend or studying economics for three hours.If you go to the movies,you will spend $8.00 on a ticket and $4.50 on popcorn.If you choose to study economics for three hours,you will raise your exam grade by 10 points.
-Refer to Scenario 1-1.What is your opportunity cost of going to the movies?

Accepted Answer

$12.50 and...

Question 6

The basic principles of economics suggest that

Accepted Answer

A)   markets are seldom,if ever,a good way to organize economic activity.
B)   government should become involved in markets when trade between countries is involved.
C)   government should become involved in markets when those markets fail to produce efficient or fair outcomes.
D)   All of the above are correct.E) None of the above
F) All of the above

Question 7

Economists study how people make decisions.

Accepted Answer

A) True 
 B)False

Exam 1: Ten Principles of Economics

What is the most important factor that explains differences in living standards across countries?

Correct Answer
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Economists study how people make decisions.

Correct Answer
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The basic principles of economics suggest that

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Communist countries worked under the premise that

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The invisible hand's ability to coordinate the decisions of the firms and households in the economy can be hindered by

Correct Answer
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Correct Answer
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$12.50 and...
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Which of the following is not an example of scarcity?

Correct Answer
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Exam 1: Ten Principles of Economics

What is the most important factor that explains differences in living standards across countries?

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Economists study how people make decisions.

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The basic principles of economics suggest that

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Communist countries worked under the premise that

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The invisible hand's ability to coordinate the decisions of the firms and households in the economy can be hindered by

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Correct Answerverified$12.50 and...View AnswerShow Answer

Which of the following is not an example of scarcity?

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Correct Answer
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$12.50 and...
View Answer

Correct Answer
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