Practice First Exam Fall 2010

Practice First Exam Fall 2010 - Practice First Exam Fall...

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Practice First Exam Fall 2010 Student: ___________________________________________________________________________ 1. The primary concern of economics is the study of: A. Why human wants exist and what motivates them B. How to distribute goods and services according to human needs C. How best to allocate scarce resources among competing uses D. Who holds the most political power in a particular country 2. Which of the following explains why economic choices must be made? A. The factors of production are scarce B. The factors of production are expensive C. The factors of production are used inefficiently D. The factors of production are of inferior quality 3. Which of the following are available in limited quantity and contribute to the problem of scarcity? A. Supply of and demand for goods and services B. Land, labor, capital and entrepreneurship C. Net exports D. Welfare of individuals and business firms Table 1.1 - Production possibilities and opportunity costs of missiles and houses Table 1.1 shows the tradeoff between different combinations of missile production and home construction, ceteris paribus. Complete the table by calculating the required opportunity costs for both missiles and houses. Then answer the indicated question(s).
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4. In Table 1.1, the opportunity cost of increasing the production of houses from 17 to 21 in terms of missiles per house is: A. 0.14 of a missile B. 0.25 of a missile C. 2.00 missiles D. 4.00 missiles 5. In Table 1.1, the highest opportunity cost of missiles in terms of houses is: A. 0.50 of a missile per house B. 4.00 missiles per house C. 7.00 missiles per house D. 10.00 missiles per house 6. In Table 1.1, the lowest opportunity cost of missiles in terms of houses is: A. 2 houses per missile B. 0.50 of a house per missile C. 0.25 missiles per house D. 0.10 missiles per house Figure 1.1 - Production possibilities curve 7. Society is producing some output, but some of the available resources are unemployed. Select the appropriate point. (See Figure 1.1.) A. A B. B C. C D. D
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8. It is not possible for society to produce this combination with current resources and technology. Select the appropriate point. (See Figure 1.1.) A. A B. B C. C D. D 9. The market mechanism: A. Is an inefficient means of communicating consumer wants to producers B. Relies on government control and planning C. Eliminates the market failures caused by government D. Relies on prices and sales to communicate consumer wants to producers 10. The price of a good or service: A. Never has an impact on the market mechanism B. Serves as the essential signal of the market mechanism C. Sometimes plays a role in the market mechanism D. Rarely has an impact on the market mechanism 11. Which of the following best describes the "invisible hand"? A. Price signals drive the market mechanism
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This note was uploaded on 02/13/2012 for the course ECON 224 taught by Professor Ozturk during the Spring '09 term at South Carolina.

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Practice First Exam Fall 2010 - Practice First Exam Fall...

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