Modules 1,2,3,4 (quiz) – Flashcards

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There are not sufficient resources to produce all the goods and services wanted.
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Scarcity in economics means:
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Human capital.
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A high-school graduate who gets a college degree is adding to the economy's stock of:
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Exists because there are not enough resources to provide all all of the goods and services that people want to purchase.
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The problem of determining what goods and services society should produce:
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Computer engineers.
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Which option can best be considered the resources used in the production of computers?
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What is given up to acquire it.
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The opportunity cost of something is:
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A model.
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A simplified representation that is used to study a real situation is called:
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Ceteris paribus.
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The assumption that all factors remain constant except for the variables being studied is called:
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Household selling a resource in the factor market.
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Jim being paid $7.25 an hour to work at a restaurant is an example in the circular flow of a:
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The new jobs at the new factory will increase local incomes, some of which will be spent at the local grocery store.
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A local grocery store benefits when a new furniture factory moves to town and hires workers because:
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True.
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A firm is an organization that produces goods and services.
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If all resources of an economy are being use efficiently, more of one good can be produced only if less of another good is produced.
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The production possibility frontier illustrates that:
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Inefficient production points.
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All points inside the production possibility frontier represent:
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Must decrease.
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Assume an economy is operating on its production possibility frontier, which shows the production of military and civilian goods. If the output of military goods is increased, the output of civilian goods:
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No idle resources and is using resources efficiently.
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If an economy is producing a level of output that is on its production possibility frontier, the economy has:
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Not all resources are equally suited to producing every good.
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Economists usually make the assumption that production is subject to increasing opportunity costs because:
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Adam Smith
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Who wrote The Wealth of Nations, a book that many credit with establishing economics as a discipline?
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The gains from trade.
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Increases in total output realized when individuals specialize in particular tasks and trade are known as:
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Avoid opportunity costs.
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Because of trade, a country may:
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At a lower opportunity cost than another economy.
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An economy is said to have a comparative advantage in the production of a good if it can produce that good:
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Laurence has an absolute advantage in both programs and sunglasses.
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If they spend all night writing computer programs, Laurence can write 10 programs whereas Carrie Anne can write 5. If they spend all night making sunglasses, Laurence can make 6 whereas Carrie Anne can make 4. Given this information and supposing Laurence and Carrie Anne have constant opportunity costs, which statement is correct?
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