1) How individuals make choices
2) How economies work through the interaction of individual choices
3) Economy-wide interactions
100
Illustrates the trade-offs facing an economy that produces only two goods:
What is The Production Possibility Frontier
100
The law of demand states that other things equal, as the price:
increases, the quantity demanded will decrease.
100
The system of taxicab medallions in New York City is an example of a:
quantity control
100
The organization that oversees global trade negotiations and settles trade disputes among its members is the:
What is World Trade Organization
200
When a chef prepares a dinner for a customer, which of the following is physical capital?
the chef
the oven
the food ingredients
the chef's training and experience
The oven
200
The branch of economic analysis that describes the way the economy actually works
What is Positive Economics
200
After graduation from college, you might have an increase in your income from a new job. If as a result you decide that you will purchase more T-bone steak and less hamburger, then for you hamburger is a(n) _____ good.
inferior
200
Loss of economic efficiency that can occur when equilibrium for a good or service is not achieved or is not achievable:
What is Deadweight loss
200
Countries that engage in trade will tend to specialize in goods in which they have _____ and will _____ those goods
a comparative advantage; export
300
When people want more goods and services than are available, the economy undergoes inflation. This statement best represents this economic concept:
Overall spending sometimes gets out of line with the economy's productive capacity
300
An economy is said to have a comparative advantage in the production of a good if it can produce that good:
What is at a lower opportunity cost than another economy
300
An increase in the demand for gasoline today caused by concerns that gasoline prices will be higher tomorrow is most likely attributable to a change in
consumer expectations
300
One of the consequences of the minimum wage has been:
workers offering to work off the books for less than the minimum wage
300
The term autarky refers to a country that
does not trade with other countries
400
The federal government regulates how much carbon dioxide a factory can emit. This statement best represents this economic concept:
What is When markets don't achieve efficiency, government intervention can improve society's welfare
400
Mary spends $5 on food for her cat. This is an example of a:
a. business buying goods and services in the product market.
b. household buying goods and services in the product market.
c. household buying goods and services in the factor market.
d. household selling a resource in the factor market.
household buying goods and services in the product market.
400
For consumers, pizza and hamburgers are substitutes. A rise in the price of a pizza causes _____ in the equilibrium price of a hamburger and _____ in the equilibrium quantity of hamburgers.
a rise; an increase
400
The market for apples is in equilibrium at a price of $0.50 per pound. If the government imposes a price floor in the market at a price of $0.40 per pound:
The price floor will not affect the market price or output
400
In the importing country, the most likely effect of a tariff in an imported product is to
raise the price and decrease the quantity demanded.
500
After swimming 100 laps at the pool, Erik decides to swim 10 more before lifting weights. This statement best represents this economic concept:
After swimming 100 laps at the pool, Erik decides to swim 10 more before lifting weights. This statement best represents this economic concept
What is “How much” is a decision at the margin
500
A series of simplified representations of economic reality that allow them to understand a variety of economic issues
Economic models
500
What may happen in the market for DVDs if D1 or S1 is the original curve and D2 or S2 is the new curve and if the cost of producing DVD players increases?
Draw a graph on the board!
500
Draw a binding price ceiling and name the 5 inefficiencies it creates in the economy
Shortage, inefficient allocation to consumers, wasted resources, low quality, and black markets
500
Bangladesh exports shirts, the making of which is labor-intensive, to the United States. The likely source of Bangladesh's comparative advantage in shirts is:
that in comparison with the United States, Bangladesh is a labor-abundant country