question

For economists, the word "utlity" means:

answer

rationality

question

In economics, the pleasure, happiness or satisfaction received from a product is called:

answer

utility

question

When economists say that people act rationally in their self-interest, they mean the individuals:

answer

look for and pursue opportunites to increase their utility

question

Economics may best be defined as the:

answer

social science with how individuals, instituations, and society make optimal choices under conditions

question

The study of economics is primarily concerned with:

answer

choices that are made in seeking the best use of reasources

question

Economics involves marginal analysis because:

answer

most decisions involve changes from the present situation

question

Opportunity costs exsit because:

answer

wants are scarce relative to resources

question

The assertion that "there is no free lunch" means that:

answer

all production involves the use of scarce resources and thus the sacrifice of alternatives

question

Consumers spend their incomes to get the maximum benefit or satisfaction from the goods and services they purchase. This is a reflection of:

answer

purposeful behavior

question

In deciding whether to study for an economics quiz or go to a movie, one is confronted by the idea(s) of:

answer

scarcity and opportunity costs

question

Which one of the following expressions best states the idea of opportunity cost?

answer

"There is no such thing as free lunch"

question

The Latin Term "ceteris paribus" means"

answer

other things equal

question

The term "other things equal" means that:

answer

a number variables are assumed to be constant

question

Macroeconomics approaches the study of economics from the viewpoint of:

answer

the entire economy

question

Microeconomics is concerned with:

answer

a detailed examination of specific economic units that make up the economic system

question

Microeconomics:

answer

Is concerned with individual economic units and specific markets

question

Which of the following is a microeconomic statement?

answer

The price of personal computers declined 4.7 percent last year

question

The economizing problem is:

answer

the need to make choices because economic means scarcity

question

The economizing problem is one of the deciding how to make the best use of:

answer

limited resources to satisfy virtually unlimited wants

question

The scarcity problem:

answer

Persists only because economic wants exceed available productive resources

question

The budget line shows:

answer

all possible combinations of two goods that can be purchased, given money, income and prices of the goods.

question

IN moving along a given budget line:

answer

the prices of both products and money income are assumed to be constant

question

An increase in money income:

answer

shifts the consumer's budget line to the right

question

The shift of the budget line form cdd to ab (left) in the figure is consistent with:

answer

a decrease in money income

question

Other things equal, an increase in a consumer's money income:

answer

shifts the individual's budget line rightward because she can now purchase more of both

question

The slope of a budget line reflects the:

answer

price ration of the two products

question

The four factors fo production are:

answer

land labor capital entrepreneurial ability

question

Economic resources are also called:

answer

factors of production

question

If the production possibilites curve is a straight line:

answer

economic resources are perfectly substituable between the prodcution of the two products

question

A production possibilites curve illustrates:

answer

scarcity

question

The production possibilites curve:

answer

shows all those combinations of two goods that are most preferred by society

question

Any point inside the production possibilities curve indicates:

answer

the more output could be produced with the available resources

question

The slope of the typical production possibilites curve:

answer

Increases as one moves southeast along the curve

question

The negative slope of the production possibilites curve is graphical way of indicating that:

answer

to produce more of product we must do with less of another

question

If an economy is operating on its production possibilites curve for consumer goods and capital good, this means that:

answer

more consumer goods can only be produced at the cost of fewer capital goods

question

A typical concave (bowed out from the origin) production possibilites curve implies:

answer

the society must choose among various attainable combinations of goods

question

The face that the slope of the production possibilities curve becomes steeper as we move down along the curve indicates that:

answer

the opportunity cost of producing each product is constant

question

The law of increasing opportunity costs states that:

answer

if society wants to produce more of a particular good, it must sacrifice larger and larger amounts of another to do so

question

The law of increasing opportunity costs is reflected in production possibilities curve that is:

answer

bowed out from the origin

question

The optimal point on a production possibilities curve is achieved where:

answer

each good is produced at a level where marginal benefits equal marginal costs

question

The marginal benefit curve is:

answer

downsloping because successive units of a specific product yeild less and less extra benefit

question

The marginal cost curve is:

answer

upsloping because of increasing marginal opportunity costs

question

Suppose that an economy is producing on its production possibilities curve but is not producing quantities of each good where the marginal benefit equals the marginal cost for each good. This economy:

answer

can improve its allocation by producing more of one good and less of the other

question

The optimal allocation of resources is found:

answer

where MB=MC

question

Through specialization and international trade, a nation:

answer

can attain some combination of goods lying outside its production possibilities curve.

Microeconomics Chapters 1&2 – Flashcards

Unlock all answers in this set

Haven't found what you were looking for?

Search for samples, answers to your questions and flashcards