The problem of determining what goods and services societyshould produce: exists
ID: 1239867 • Letter: T
Question
The problem of determining what goods and services societyshould produce:
exists because we canproduce more than we need or want.
exists because there arenot enough resources to provide all the goods and services thatpeople want to purchase.
would not exist if allgoods and services were scarce.
would not exist ifgovernment owned all of the resources.
Which of the following principles underlie the economics ofindividual choices?
There are gains fromtrade.
Markets move towardequilibrium.
People usually exploitopportunities to make themselves better off.
Resources should beused as efficiently as possible to achieve society'sgoals.
Specialization and trade usually lead to:
lower economicgrowth.
the exchange of goodsand services in markets.
lower livingstandards.
higherprices.
When moving along a production possibilities curve, theopportunity cost to society of getting more of one good:
is constant.
is measured in dollarterms.
is measured by theamount of the other good that must be given up.
usuallydecreases.
The fact that a society's production possibilities curve isbowed out or concave to the origin of a graph demonstrates the lawof:
increasing opportunitycost.
decreasing opportunitycost.
constant opportunitycost.
concave opportunitycost.
The circular-flow diagram illustrates how households _______goods and services and _______ factors of production.
buy; sell
buy; buy
own; buy
own; sell
An example of a positive statement is:
The rate ofunemployment is 4 percent.
A high rate ofeconomic growth is good for the country.
Everyone in thecountry needs to be covered by national health insurance.
Baseball playersshould not be paid higher salaries than the president of the UnitedStates.
If during a period of several months we observe the economy tobe simultaneously increasing its level of output and employment, wecould assume that the economy is in ______.
a depression
an expansion
a recession
a turning pointbetween a recovery and a downturn
The actual numerical measure of aggregate output typically usedby economists is called ______.
aggregateoutput
nominal gross domesticproduct
net domesticproduct
real gross domesticproduct
Explanation / Answer
-For the first one, the answer is C because this is the fundamental law of economics- to try to make decisions about what to produce based on the limited number of resources one has. - For number 2, I'm not truly sure, I would go with C as we try to maximize our marginal utility(enjoyment derived from products) in acting as consumers. - Number 3 is B. Suppose I make ice cream. You make chocolate syrup. I want some of that syrup and you want some of that ice cream so we can both make sundaes (corny analogy). We are both specializing in something and we will be trading. - Number 4 is C because in making other products we are using resources that could have gone in producing different products. We measure this loss in the potential other products that could have been made. - Number 5 is A because as make more and more of a product we must give up more and more of the other (efficiency decreases as our production lines do not have perfectly interchangeable functions- they are not made to produce a single type of product). - Number 6 is A because of the definition of the model. households are considered consumers and so demand products and services. They serve as factors of production because they "produce" people that go into the workforce and help produce services. - Number 7 is really ambiguous. I would go with A but keep in mind that unemployment rate is misleading as it does not include discouraged workers(left workforce statistics because impossible to get a job). - Number 8 is B (expansion) because this is both a shift in the demand curve(employment) and the supply curve(output increases). These two shifts contribute in an expansion of the economy. -Number 9 is real GDP (answer D) because this is the standard universal measure of economic "well-being" it measure the total value of goods and services produced WITHIN the country. does not include second hand sales.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.