Econ Recall – Flashcards
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True (1&2)
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Scarcity means that there is less of a good or resource available than people wish to have.
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False (1&2)
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Economics is the study of how evenly goods and services are distributed within society
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True (1&2)
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Trade allows each person to specialize in the activities he or she does best, thus increasing each individual's productivity
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True (1&2)
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in the circular-flow diagram, one loop represents the flow of goods, services and factors of production, and the other loop represents the corresponding flow of dollars.
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True (1&2)
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If an mjor union goes on strike, then the country would be operating inside its production possibilities frontier.
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True (1&2)
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If a new government regulations designed to protect wetlands remove very productive farmland from production, then the production possibilities frontier will shift inward.
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True (1&2)
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Economist acting as scientists make positive statements, while economist acting as policy adviser make normative statements.
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False (1&2)
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The Councils of Economic Advisers consist of thirty members and a staff of several dozen economists.
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True (3&4)
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The production possibilities frontier shows that trade-offs that the producers faces but does not identify the choice the producer will make
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False (3&4)
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In one month, Moira can knit 2 sweaters or 4 scarves, in one month, Tori can knit 1 sweater or 3 scarves. Moira's opportunity cost of knitting scarves is lower than Tori's opportunity cost of knitting scarves.
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False (3&4)
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The gains from specialization and trade are based on absolute advantage.
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True (3&4)
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Trade can benefit everyone in society because it allows people to specialize in activities in which they have a comparative advantage.
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True (3&4)
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International trade an make some individuals within a country worse off, even as it makes the country as a whole better off.
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True (3&4)
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in a competitive market, the quantity of each good produced and the price at which it is sold are not determined by any single buyer or seller.
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True (3&4)
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a market's equilibrium is the point at which the supply and demand curves intersect.
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True (3&4)
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the equilibrium price is the same as the market-cleaning price
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True (3&4)
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when the market price is above the equilibrium price, suppliers are unable to sell all they want to sel
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True (3&4)
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a shortage is the same as an excess demand.
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True (7&8)
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In a competitive market, sales go to those producers who are willing to supply the product at the lowest price.
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True (7&8)
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if producing a soccer ball cost Jake $5 and he sells it for $40, his producers surplus is $35
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True (7&8)
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marker power and externalities are examples of market failures.
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True (7&8)
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when a tax is imposed on buyers, consumers surplus and producer surplus both decrease
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True (7&8)
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taxes affect market participants by increasing the price paid by the buyer and decreasing the price received by the seller
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True (7&8)
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tax revenue equals the size of the tax multiplied by the quantity sold in the market after tax is levied...
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True (7&8)
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taxes on labor tend to encourage the elderly to retire early...
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False (7&8)
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the demand for bread is less elastic than the demand for donuts; hence, a tax on bread will create a larger deadweight loss than will the same tax on donuts, other things equal
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True (7&8)
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the Social Security tax is a labor tax
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True (7&8)
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the idea that tax cuts would increase the quantity of labor supplied, thus increasing tax revenue, became know as supply-side economics
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True (9&10)
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when a country that imports shoes imposes a tariff on shoes, buyers of shoes in that country becomes worse off
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True (9&10)
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the imposition of a tariff on imported wine will increase the domestic price of wine, decrease the quantity of wine imported and increae the quantity of wine produced domestically
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False (9&10)
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the nation of Cranolia used to prohibit international trade, but now trade is allowed and Cranolia is exporting furniture. Relative to the previous no-trade situation, buyers of furniture in Cranolia are now better off
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True (9&10)
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William and Jamal live in the country of Dumexia . When Dumexia legalized international trade in bananas, the price of bananas in Dumexia increased. As a result William became better off and Jamal became worse off. IT follows that William is a seller, and Jamal is a buyer, of bananas.
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True (9&10)
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economists view free trade as a way to raise living standards both at home and abroad.
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True (9&10)
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the results of a 2008 Los Angeles Times
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True (9&10)
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True (9&10)
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True (9&10)
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