Economics Essay

Top of Form 1. (TCO 1) The general concern of economics is with the study of the (Points : 1) | degree of competition in stock and bond markets in the economy. efficient use of limited productive resources to satisfy economic wants. issue of equality in the distribution of income and wealth among households. budget deficits in the domestic economy and trade deficits in the international economy. | 2. (TCO 1) The term scarcity in economics refers to the fact that (Points : 1) | economic wants are limited and resources are abused. ven in the richest country some people go hungry. no country can produce enough products to satisfy everybody’s economic wants. it is impossible to produce too much of any particular good or service in a market economy. | 3. (TCO 1) Are the goods that businesses offer for “free” to consumers also free to society? (Points : 1) | Yes, because the individual consumer does not have to pay for them. Yes, because the marginal benefit is greater than the marginal cost. No, because scarce resources were used to produce the free goods.

No, because society does not assign a value to free goods. | 4. (TCO 1) Which is not considered to be an economic resource? (Points : 1) | Land (or natural resources) Money Labor Tools and machinery | 5. (TCO 1) A movement along the production possibilities curve would imply that (Points : 1) | the labor force has grown. productivity has increased. productivity has declined. society has chosen a different set of outputs. | 6. (TCO 1) Which would not be characteristic of a capitalist economy? (Points : 1) | Government ownership of the factors of production

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Competition and unrestricted markets Reliance on the market system Free enterprise and choice | 7. (TCO 1) The term consumer sovereignty means that (Points : 1) | consumers are controlled by the actions of the marketplace. what is produced is ultimately determined by what consumers buy. there are no limits on what consumers may buy under capitalism. businesses produce with consumer satisfaction as their primary goal. | 8. (TCO 1) In the circular flow model, households (Points : 1) | buy products and resources. sell products and resources. uy products and sell resources. sell products and buy resources. | 9. (TCO 1) Which is a major feature of the market system? (Points : 1) | Government set prices in all markets Reallocation of all resources from private to public uses The right to own private property and control resource use Central planning by government to provide goods and services | 10. (TCO 1) Which is necessary to make a trade in a barter economy? (Points : 1) | Money Unlimited wants A medium of exchange A coincidence of wants | 11. (TCO 1) Tammie makes $150 a day as a bank clerk.

She takes off two days of work without pay to fly to another city to attend the concert of her favorite music group. The cost of transportation for the trip is $250. The cost of the concert ticket is $50. What is the opportunity cost of Tammie’s trip to the concert? Show your calculations (Points : 5) | 12. (TCO 1) How do the different economic systems (capitalism and socialism) differ in the way they answer these three questions – What to Produce? How to Produce? and For Whom to Produce? (Points : 5) | | Time Remaining: | | Bottom of Form