Microassignment # 1
Microassignment # 1
Microassignment # 1
2. The branch of economics that studies the decisions of individuals and firms is called
a. macroeconomics.
b. microeconomics.
c. microeconomics and macroeconomics.
d. positive economics.
e. normative economics.
c. PPF after the war is probably the same PPF as before the war.
e. b and d
8. What is the reason for the law of increasing marginal opportunity costs?
a. There is no reason: it is just one of the laws of economics.
b. Resources have varying abilities and those with lower opportunity costs of producing a good will
be used to produce it before resources with higher opportunity costs produce it.
c. The price of a good rises as more of it is demanded.
d. As more of a good is produced, the taxes applied to the production of the good rise.
e. c and d
10. An increase in the number of buyers in a particular market for a good will result in
a ________________ for that good.
a. movement up along the demand curve
b. movement down along the demand curve
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c. leftward shift in the demand curve
d. rightward shift in the demand curve
11. The law of demand states that price and quantity demanded are
a. directly related, ceteris paribus.
b. inversely related, ceteris paribus.
c. independent.
d. positively related, ceteris
paribus.
12. Which of the following is not one of the four broad categories of resources?
a. labor
b. government
c. capital
d. entrepreneurship
e. land
13. Produced goods used as inputs for the production of other goods comprise the
resource known as
a. natural resources.
b. services.
c. capital.
d. entrepreneurship.
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16. Refer to the Exhibit above. The opportunity cost of 1 unit of cheese in terms of units
of wine is __________ for country A.
a. 1/2
b. 2
c. 10
d. 5
e. none of the
above
17. Refer to the Exhibit above. The opportunity cost of 1 unit of wine in terms of units of
cheese is __________ for country A.
a. 1/2
b. 2
c. 10
d. 5
e. none of the
above
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19. To an economist, an increase in demand means the same thing as an increase in quantity
demanded.
a. True
b. False
21. Saying "the marginal costs are greater than the marginal benefits" is the same as saying
a. the average costs are greater than the average benefits.
b. the total costs are greater than the average benefits.
c. the benefits are greater than the costs.
d. the additional costs are greater than the additional
benefits.
e. the costs minus the benefits equal the net costs.
22. When the price of Toyota Corollas rises, ceteris paribus, the demand for Corollas
falls.
a. True
b. False
23. In moving along a demand curve, everything is held constant except buyers'
income.
a. True
b. False
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25. If Max's demand for hot dogs falls as his income rises, then for Max hot dogs
are
a. a bad good.
b. an inferior good.
c. a preferential good.
d. a normal good.
e. a neutral good.