Basicconceptstest1

Basicconceptstest1 - Basic Concepts Test 1. The main...

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Basic Concepts Test 1. The main economic problem that every economy faces is: ___ (A) limited wants and unlimited money. ___ (B) unlimited wants and limited money. ___ (C) limited wants and limited resources. ___ (D) unlimited wants and limited resources. ___ (E) unlimited resources and limited money. 2. In economics it is important to consider the opportunity cost of a decision. The opportunity cost can best be described as: ___ (A) the dollar value of a decision. ___ (B) the next best option that has to be given up by making a decision. ___(C) the decision whether or not to use capital or labor resources. ___ (D) the decision whether or not the decision will make you happy. ___ (E) the chance that consumers want this good. 3. The real cost of producing a good or product is? ___ (A) the dollar cost of production. ___ (B) the labor cost of production. ___ (C) the resource cost of production. ___ (D) the capital cost of production. ___ (E) the land cost of production. 4. The production possibilities model illustrates the: ___ (A) the consumption possibilities in an open economy. ___ (B) the labor cost of producing a good. ___ (C) only an economy that is at full employment. ___ (D) the opportunity cost of producing a good. ___(E) the dollar cost of producing a good. 5. A machine used to cut and shape wood would be categorized as what type of input? ___ (A) labor resource ___ (B) capital resource ___ (C) human resource ___ (D) financial resource ___ (E) service resource
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6. Refer to the Brureff Electronics Col. Graph above. This production possibilities graph illustrates the maximum quantity of televisions and computers that the Brureff Electronic Company can produced. If the company is efficient and employs all of its available resources it can produce: ___ (A) 70 computers and 140 televisions. ___(B) 70,000 computers and 140,000 televisions. ___ (C) Only 70 computers or only 140 televisions. ___ (D) Only 70,000 computers or only 140.000 television. ___ (E) 70,000 computers or 140,000 televisions or some combination of both that falls on the production possibilities curve.
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7. Refer to the graph above. If the Brureff Electronic Company decides to produce 30,000 computers the maximum amount of televisions that it can also produce is: ___ (A) 0 ___ (B) 60,000 ___ (C) 80,000 ___ (D) 100,000 ___ (E) 140,000
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8. Refer to the graph above. If the Brureff Electronic Company was fully utilizing all of its resources and wanted to change the quantity of computers produced from 30,000 to 40,000, the opportunity cost would be: ___ (A) there is no opportunity cost ___ (B) 20,000 televisions ___ (C) 40,000 televisions ___ (D) 60,000 televisions ___ (E) 80,000 televisions
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at full production and producing 100,000 televisions. It decides to increase the production of televisions what will be the opportunity cost of each additional television that it produces? ___ (A) 70 computers
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This note was uploaded on 04/08/2008 for the course ECON 211 taught by Professor Na during the Spring '08 term at Rice.

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Basicconceptstest1 - Basic Concepts Test 1. The main...

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