question

A minimum price set above the equilibrium price is a:

answer

price floor

question

In the mid 1960s, the percentage of total output the United States devoted to health care was about ________ percent.

answer

6

question

As the fraction of health-care costs paid by consumers falls, their quantity of health-care services consumed increases.

answer

True

question

Which of the following would lead to an increase in the demand for health care?

answer

The average population age increases.

question

Between 1930 and 1933, the prices received by farmers tended to:

answer

decrease

question

One source of high health care costs is the:

answer

relatively large fraction of health care expenditures paid by third-party payers.

question

In terms of equity, existing farm policies tend to help:

answer

wealthy farmers more than poor farmers.

question

Eliminating third-party payer systems is most likely to ________ the quantity of health care ________.

answer

decrease; demanded

question

A market price floor for wheat:

answer

increases the price paid by consumers.

question

Health care is a(n)

answer

normal good

question

The market for health care is characterized by which of the following? (a)significant third-party payments (b)a falling fraction of the total cost the consumers of health care actually pay (c) dramatic increases in costs because of technological advances in medical care (d) all of the above

answer

all of the above

question

Economists classify health care as:

answer

a normal good

question

A feature of the health-care market is:

answer

that demand has increased relative to supply.

question

A decrease in supply is caused by:

answer

a decrease in the price of a good using the same resources.

question

A decrease in both supply and demand will lead to a decrease in equilibrium quantity.

answer

true

question

Which of the following would shift the demand curve for new textbooks to the right?

answer

An increase in college enrollments.

question

A decrease in price will lead to an increase in the quantity demanded.

answer

true

question

A supply curve that is upward sloping means that:

answer

suppliers will want to sell more at higher prices.

question

Which of the following will result in an increased price of milk?

answer

A shift to the right of the demand curve for milk.

question

There can be no shortages or surpluses at the equilibrium price.

answer

true

question

In a competitive market, when price is below the equilibrium price, there will be pressure for the price to:

answer

rise

question

A factor of production that is produced in order to produce something else is called:

answer

capital

question

Inefficiency occurs when an economy is operating outside its production possibilities curve.

answer

false

question

The North Korean economy is currently classified as:

answer

command socialism.

question

If two countries participate in free trade:

answer

both countries as a whole will gain from the trade.

question

Any point inside a production possibilities curve indicates:

answer

unemployment and/or inefficiency.

question

If an economy is producing a combination of goods that places it inside the production possibilities curve, then it has:

answer

idle factors of production or inefficient use of resources.

question

Human capital is:

answer

the set of acquired skills and abilities that workers bring to the production of goods and services.

question

The basic economic differences among nations throughout history concerning institutions, philosophy, and ideology mainly focus on:

answer

the ownership of factors of production and how they are coordinated in economic activity.

question

Improvements in technology provide benefits to: (a)consumers, through lower prices. (b) workers, although some jobs may be eliminated. (c) firms, through lower production costs. (d) all of the above.

answer

(d) all of the above.

question

In a command socialist economy:

answer

resources are government owned and government exercises broad power over their use.

question

If countries do not engage in international trade: (a) they give up the ability to specialize in production. (b) worldwide levels of production are lower. (c) the world will be operating inside its production possibilities curve. (d) all of the above are true.

answer

(d) all of the above are true.

question

The "all other things unchanged" assumption is used to:

answer

simplify the very complex real world.

question

A person who mistakenly assumes that because one event follows another, the second event results from the first commits the fallacy of:

answer

false cause

question

Opportunity cost is:

answer

the value of the best alternative forgone in making any choice.

question

A free good is one that can be acquired without sacrifice.

answer

true

question

The fallacy of false cause is committed when a person mistakenly assumes that one event causes another because the first event precedes the second.

answer

true

question

The concept of scarcity indicates that:

answer

almost all goods have alternative uses.

question

A basic assumption used in many economic models is:

answer

ceteris paribus, which means all other things remain unchanged.

question

The answer to, "What goods are to be produced ?" deals with:

answer

the kinds and quantities of goods and services produced.

question

The study of a single firm and how it determines prices would fall under:

answer

microeconomics

question

A simplified representation of a particular problem is a:

answer

model

question

Ceteris paribus means:

answer

all other things unchanged

question

The Case in Point on oil extraction implies that the environmental damage associated with future oil extraction is likely to :

answer

rise because more environmentally invasive procedures will be required to extract oil.

question

An example of a normative statement is:

answer

A high rate of economic growth is good for the country.

question

The branch of economics that examines the impact of choices on aggregates in the economy is:

answer

macroeconomics

question

A scarce resource is one that:

answer

has two or more alternative uses.

question

Statements that are a hypothesis or statement of fact are:

answer

positive

question

If the opportunity cost of manufacturing machinery is lower in the United States than in Britain and the opportunity cost of manufacturing sweaters is higher in the United States than in Britain, then the United States will:

answer

import sweaters from Britain and export machinery to Britain.

question

A production possibilities curve measures cost in terms of dollars spent, not in terms of sacrificed alternatives.

answer

false

question

In market capitalism:

answer

factors of production are privately owned and decisions are made privately.

question

If an economy has to sacrifice only one unit of good X for each unit of good Y produced throughout the relevant range, then its production possibilities curve has a(n):

answer

constant, negative slope.

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