Which One Of The Following Expressions Best States The Idea Of Opportunity Cost?

A. Interaction between macro and micro considerations. Student: 1 . Economics may B. Social science concerned with how individuals, institutions, and society make optimal choices under conditions of scarcity. C. Empirical testing of value Judgments through the use of logic. D. Use of policy to refute facts and hypotheses. 2. The scarcity problem: A. Persists only because countries have failed to achieve continuous full employment. B. Persists because economic wants exceed available productive resources.

C. Has been solved in all industrialized nations. D. Has been eliminated in affluent societies such as the United States and Canada. 3. In deciding whether to study for an economics quiz or go to a movie, one is confronted by the idea(s) of: A. Scarcity and opportunity costs. B. Money and real capital. C. Complementary economic goals. D. Full production. 4. You should decide to go to a movie: A. If the marginal cost of the movie exceeds its marginal benefit. B. If the marginal benefit of the movie exceeds its marginal cost. C. If your income will allow you to buy ticket.

D. Because movies are enjoyable. 5. The assertion that “There is no free lunch” means that: A. There are always tradeoffs between economic

goals. B. All production involves the use of scarce resources and thus the sacrifice of alternative goods. C. Marginal analysis is not used in economic reasoning. D. Choices need not be made if behavior is rational. 6. Which one of the following expressions best states the idea of opportunity cost? A. “A penny saved is a penny earned. ” B. “He who hesitates is lost. ” C. “There is no such thing as a free lunch. D. All that glitters is not gold. ” 7. (Consider This) A direct cost of going to college is: A. Tuition, while an indirect cost (opportunity cost) is books and other supplies. B. Forgone income while in college, while an indirect cost (opportunity cost) is tuition. C. Tuition, while an indirect cost (opportunity cost) is forgone income while in college. D. Books and supplies, while an indirect cost (opportunity cost) is food and housing. 8. Even though local newspapers are very inexpensive, people rarely buy more than Economics 202 By Mini Chaw-Pam

B. Implies that reading should be taught through phonics rather than the whole language method. C. Contradicts the economic perspective. D. Implies that, for most people, the marginal benefit of reading a second newspaper is less than the marginal cost. 9. In economics, the pleasure, happiness, or satisfaction received from a product is called: A. Marginal cost. B. Rational outcome. C. Status fulfillment. D. Utility. 10. Purposeful behavior suggests that: A. Everyone will make identical choices. B. Resource availability exceeds economic wants.

C. Individuals will make different choices because of different desired outcomes. D. An individual’s economic goals cannot involve tradeoffs. 11. Which of the following statements pertains to macroeconomics? A. Because the minimum wage was raised, Mrs.. Olsen decided to enter the labor force. B. A decline in the price of soybeans caused farmer Wane to plant more land in wheat. C. National income grew by 2. 7 percent last year. D. The Pumpkin Center State Bank increased its interest rate on consumer loans by 1 percentage point. 12.

Which of the following is a microeconomic statement? A. The real domestic output increased by 2. 5 percent last year. B. Unemployment was 6. 8 percent of the labor force last year. C. The price of personal computers declined last year. D. The general price level increased by 4 percent last year. 13. A well-tested economic theory is often called: A. A hypothesis. B. A prototype. C. A principle. D. An anomaly. 14. The term “sisters Paramus” means: A. That if event A precedes event B, A has caused B. B. That economics deals with facts, not values. C. Other things equal.

D. Prosperity inevitably follows recession. 15. Suppose an economist says that “Other things equal, the lower the price of bananas, the greater the amount of bananas purchased. ” This statement indicates that: A. The quantity of bananas purchased determines the price of bananas. B. All factors other than the price of bananas (for example, consumer tastes and incomes) is assumed to be constant. C. Economists can conduct controlled laboratory experiments. D. One cannot generalize about the relationship between the price of bananas and the quantity purchased.