Chap 1 Practice Problems

Chap 1 Practice Problems - Practice Problems for Chapter 1...

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Practice Problems for Chapter 1 AGEC 105 1. Even though households may have unlimited wants, they have to allocate their spending carefully because they a. Do not want their credit card bills to be too high b. Worry about their taxes c. Have limited intelligence d. Have limited income e. Basically want to become wealthy 2. The three groups of decision makers in the economy are a. Households, business firms and banks b. Households, business firms and government c. Business firms, government and banks d. Business firms, bank and foreign trade e. Household, government and banks 3. Economics is the study of choice under conditions of a. Demand b. utility c. Scarcity d. Opportunity cost e. Abundance f. 4. Economics is the study of a. How to make money in financial markets b. How to allocate unlimited resources to satisfy limited uses c. How to allocate limited resources to satisfy unlimited wants d. Using stocks and bonds to their maximum potential e. How to be conservative in financial affairs 5. Scarcity is a situation in which a. Available resources cannot satisfy all potential uses for the resources b. There are unlimited wants c. Resources outnumber the potential uses for resources in society d. There is a surplus, since buyers cannot obtain all of the goods that they want e. Society’s productive capital is publicly owned
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6. The basic problem addressed in economics is a. Scarce resources and unlimited wants b. Scarce wants and unlimited wants c. Cost minimization d. How to manage a financial portfolio e. Unlimited time and unlimited potential 7. The problem of scarcity occurs under a. Centrally planned and socialist economies, but not capitalism b. Communism and communal ownership only c. Socialism and capitalism, but not communism d. Communal ownership, communism and socialism, but not capitalism e. All economic systems 8. A physician’s knowledge and skills is referred to by economists at a. Human resources b. Biological resources c. Physical resources d. Entrepreneurship e. Intellectual raw materials 9. Which of the following is the best example of physical capital used to produce a textbook? a. The expertise and writing ability of the authors b. The ink used in the printing press c. The printing press d. The property on which the publisher’s office is located e. The time spent by editors reviewing the textbook 10. Suppose that you start you own company making T-shirts that commemorate campus sporting events. An example of the resource capital would be a. The “factory” you created in a building you are leasing
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Chap 1 Practice Problems - Practice Problems for Chapter 1...

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