07_Final_Exam

07_Final_Exam - ECON 200N Autumn 2007 Final Exam Multiple...

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ECON 200N Autumn 2007 Final Exam Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 1. Economics deals primarily with the concept of a. scarcity. b. poverty. c. change. d. power. ____ 2. Which of the following is correct? a. Equity and efficiency are both maximized in a society when total surplus is maximized. b. Equity can be judged on positive grounds whereas efficiency requires normative judgments. c. Efficiency deals with the size of the economic pie and equity deals with how fairly the pie is sliced. d. Efficiency is more difficult to evaluate than equity. Figure 1 ____ 3. Refer to Figure 1. Juan buys a new pair of shoes at a shoe store. To which of the arrows does this purchase directly contribute? a. C and D b. A only c. A and B d. C only
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____ 4. “Prices rise when the quantity of money rises rapidly” is an example of a a. negative economic statement. b. positive economic statement. c. normative economic statement. d. statement that contradicts one of the basic principles of economics. Table 1. Production Possibilities for Toyland Dolls Fire Trucks 400 0 300 200 200 350 100 450 0 500 ____ 5. Refer to Table 1 . Which of the following statements accurately describes the production possibilities for Toyland? a. The opportunity cost of an additional 100 dolls is 50 fire trucks. b. The opportunity cost of an additional 100 dolls is 100 fire trucks. c. Toyland’s production possibilities frontier is a straight, downward-sloping line. d. The opportunity cost of an additional 100 dolls increases as more dolls are produced. Figure 2 ____ 6. Refer to Figure 2. . The opportunity cost of 2 bushels of corn for Cliff is a. 2 bushels of wheat. b. 3 bushels of wheat. c. 6 bushels of wheat. d. 12 bushels of wheat.
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Table 2 Hours needed to make one: Amount produced in 2400 hours: Car Airplane Cars Airplanes Japan 30 150 80 16 U.S. 50 200 48 12 ____ 7. Refer to Table 2. Japan has a comparative advantage in a. airplanes and the United States has an absolute advantage in neither good. b. cars and the United States has an absolute advantage in airplanes. c. cars and the United States has an absolute advantage in neither good. d. airplanes and the United States has an absolute advantage in both goods. ____ 8. Suppose that a worker in Cornland can grow either 40 bushels of corn or 10 bushels of oats per year, and a worker in Oatland can grow either 5 bushels of corn or 50 bushels of oats per year. There are 20 workers in Cornland and 20 workers in Oatland. If the two countries do not trade, Cornland will produce and consume 400 bushels of corn and 100 bushels of oats, while Oatland will produce and consume 60 bushels of corn and 400 bushels of oats. If each country made the decision to specialize in producing the good for which it has a comparative advantage, then the combined yearly output of the two countries would increase by a. 280 bushels of corn and 450 bushels of oats.
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This note was uploaded on 11/28/2010 for the course ECON 200 taught by Professor Newton during the Fall '08 term at Ohio State.

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07_Final_Exam - ECON 200N Autumn 2007 Final Exam Multiple...

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