==2009 midterm 1 version 2==

==2009 midterm 1 version 2== - Page 1 of 11 McMaster...

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Page 1 of 11 McMaster University Department of Economics ECON 1B03 Midterm Test #1 VERSION 2 Instructor: Professor H Holmes Duration: 1.5 hours Total Number of Pages: 11 INSTRUCTIONS : Answer all questions on the scan sheets. USE AN HB PENCIL ONLY. Make sure you carefully fill in the bubbles. YOU MUST FILL IN YOUR STUDENT NUMBER, AND VERSION NUMBER ON THE SCAN SHEET OR YOUR GRADE WILL NOT BE RECORDED AND YOU WILL LOSE THE BONUS MARK. You may use the Casio FX calculator. Hand in the scan sheet and this test copy. TOTAL MARKS AVAILABLE : 45 NAME:____________________________________________________ STUDENT #: _______________________________________________ MUGSI ID: ________________________________________________
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Page 2 of 11 Multiple Choice Identify the choice that best completes the statement or answers the question. ____ 1. Scarcity exists when a. there is less than an infinite amount of a resource or good. b. society can meet the wants of every individual. c. there is less of a good or resource available than people wish to have. d. the government fails to produce goods. ____ 2. One definition of equity would be a. equality. b. efficiency. c. fairness. d. similarity. ____ 3. After much consideration, you have chosen Cancun over Ft. Lauderdale for your Spring Break trip this year. For this decision to change, which of the following must occur? a. The marginal benefit of Cancun must increase. b. The marginal cost of Cancun must decrease. c. The marginal benefit of Ft. Lauderdale must increase. d. The marginal cost of Ft. Lauderdale must increase. ____ 4. An economic outcome is said to be efficient if the economy is a. using all of the resources it has available. b. conserving on resources and not using all it has. c. getting all it can from the scarce resources it has available. d. able to produce more than its current production without additional resources. ____ 5. The curved shape of the production possibilities frontier can be explained by a. increasing cost of production. b. constant cost of production. c. scarcity. d. economic growth. Figure 2-3
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Page 3 of 11 ____ 6. Refer to Figure 2-3 on the previous page . Which point or points are inefficient? a. A, C b. D, C c. C d. D Figure 2-6 ____ 7. Refer to Figure 2-6 . If this economy put all available resources into the production of bananas, it could produce a. 200 bananas and also 150 baseballs. b. 300 bananas and also 100 baseballs. c. 400 bananas and no baseballs. d. It is impossible to know unless we know the quantity of resources available. ____ 8. The production possibilities frontier is bowed outward if a. resources are not perfectly shiftable. b. the amount of resources increases. c. the level of technology increases. d. Both b and c are correct
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This note was uploaded on 03/13/2011 for the course ECON 1B03 taught by Professor Hannahholmes during the Spring '08 term at McMaster University.

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==2009 midterm 1 version 2== - Page 1 of 11 McMaster...

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