Econ Problem Set 01 - Problem Set 01 Econ 103 Macroeconomic...

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Problem Set 01 page 1/10 Econ 103 – Macroeconomic Principles Fall 2010 Multiple-choice questions Identify the letter of the choice that best completes the statement or answers the question. Part I – Production Possibility Curve 1) Factors of production do not include A) land B) labor C) money D) capital E) human capital 2) Human capital can be increased by more A) robots aiding workers B) machinery produced with combinations of labor and capital C) workers' education and experience D) factories built to accommodate workers E) oil discovered that can be used to energize the capital workers use 3) The law of increasing costs indicates that A) as more goods are produced, the dollar cost of this production increases B) the amount of production decreases if costs increases C) the opportunity cost of producing a good increases as more of the good is produced D) although total cost may increase as you produce more of a good, the opportunity cost of producing additional units of the good decreases E) greater division of labor is possible as production increases 4) A production possibilities curve is downward sloping because of A) the law of increasing costs B) the finite nature of the resource base C) inefficiency D) constant opportunity cost between goods E) unemployment 5) What is the usual shape of the production possibilities curve? A) upward-sloping B) concave from the origin C) convex from the origin D) a straight-line, downward-sloping curve E) U-shaped Extra: It usually has the shape described above because …
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Problem Set 01 page 2/10 Econ 103 – Macroeconomic Principles Fall 2010 6) In year 1998 the country of Exhibit B-6 was located at point A on its year 1998 production possibilities curve. In 1999 this country was located at point B on its 1999 production possibilities curve. This country A) is producing the same quantity of capital goods in both years B) is producing the same quantity of consumption goods in both years C) had no economic growth between 1998 and 1999 D) had higher unemployment in 1998 than in 1999 E) had higher unemployment in 1999 than in 1998 7) In year 1998, the country of Exhibit B-6 was located at point A on its year 1998 production possibilities curve. In 1999 this country was located at point B on its 1999 production possibilities curve. This economy A) produces less of both goods in 1999 than in 1998 B) produces less of capital goods in 1999 than in 1998 C) is more efficient in 1999 than in 1998 D) experienced economic growth since 1998 E) had higher unemployment in 1999 than in 1998 8) Exhibit B-9 presents the production possibilities curve of an economy. The combination of goods given by point H could A) never be achieved by this economy B) be achieved today if the economy achieved full employment C) be achieved today if the economy achieved maximum efficiency D) not be achieved today
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Problem Set 01 page 3/10 Econ 103 – Macroeconomic Principles Fall 2010 9) In Exhibit B-9, which of the following is FALSE regarding point H? Point H.
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This note was uploaded on 03/10/2011 for the course ECON 103 taught by Professor Staff during the Spring '08 term at University of Illinois, Urbana Champaign.

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Econ Problem Set 01 - Problem Set 01 Econ 103 Macroeconomic...

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