UNT Economics 1110, Exam 1, Spring 2013

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UNT Economics 1110, Exam 1, Spring 2013
2013-04-11 21:06:53
Production Possibilities Economic Systems Demand Supply Unemployment Inflation National Income Accounting

Chapters 1-5 Review of Macroeconomics Workbook: Principles and Practice
Show Answers:

  1. What is this statement associated with?Inflation and national unemployment rates in the 1970's.
  2. An office workers computer is an example of what?
    Economic capital
  3. In the simple circular flow model:
    Households are suppliers in resource market and demanders in the product markets
  4. "If you stand up at a soccer game, you may get a better view of the game. So if everyone stands up at the game, everyone will get a better view." This illustrates:
    Fallacy of composition
  5. The study of economics is primarily concerned with:
    choices which are made in seeking to use scarce resources efficiently.
  6. Holly says that "the imposition of a tax on beer will raise it's price." Ben argues that "taxes should be imposed on beer because college students drink too much." We can conclude that:
    Ben's statement is normative, but Holly's is positive.
  7. The opportunity cost for using lumber to make billboards is:
    The value of the lumber in its next best alternative use
  8. What is not an essential element of a capitalist (market) economy?
    Government determines what is produced
  9. Production possibilities frontiers (curves):
    illustrate the limits to what can be produced from current resources and technology
  10. What would cause a rightward shift in the production possibilities curve?
    Increase in resources, technology and cheaper materials
  11. A point under the production possibilities curve is considered:
    an inefficent use of the economies resources
  12. The major macroeconomic policy goals of most industrialized nations are:
    full employment, price stability, and economic growth
  13. Going from an inefficient use of resources to an efficient use of resources would be illustrated by:
    moving from a point inside the PPF to a point in the PPF
  14. Opportunity cost
    The item lost when you gain another on the PPF
  15. On a liner PPF curve what does it reflect?
    The resources are not equally well suited in the production of consumer goods and capital goods
  16. An increase in the price of Spalding tennis balls, a substitute for Wilson will cause an increase or decrease in demand for Wilson tennis balls?
  17. Ceteris paribius, an increase in the price of coffee causes:
    a decrease in quantity demanded of coffee
  18. Law of Supply
    Price and quantity supplied are positively related (CP)
  19. A decrease in the cost of manufacturing cell phones will increase or decrease the supply?
  20. If drought conditions in the farm belt result in a decrease in the supply of wheat, what will happen to the equilibrium price and quantity of wheat (CP)?
    Price increases and quantity decreases
  21. How does a price adjustment eliminates a surplus?
    Price falls, quantity demand increases, quantity supplied decreases
  22. Assume CDs represent a normal good. If consumer income decreases and there is a decrease in the number of CD sellers, we would expect:
    Equilibrium quantity decreases but equilibrium price is indeterminate
  23. When the economy is operating with full employment then:
    There is no cynical unemployment
  24. Assuming the total population is 100 million, the labor force is 50 million, and 45 million workers are employed, the unemployment rate is:
  25. Official unemployment statistics are more likely to understate the true unemployment problem when:
    underemployed workers are counting among the employed ad there are discouraged workers
  26. Suppose Bob Smith is a new collage graduate wiht a degree in engineering. Bob has had several job offers, but has chosen to remain unemployed while he continues to search for the 'ideal' job. Bob Smith is:
    Fictionally unemployed
  27. Sluggo Johnson, a painter on the General Motors assembly line who was recently replaced by a robot. What kind of unemployment is this?
  28. Inflation
    an increase in the average level of prices of goods and services over time
  29. Suppose at the start of the year you receive an income increase of 3% from your employer. If the price of goods and services you typically purchase increase 6% during the year, you would find for the year you have experienced:
    higher nominal income but lower real income
  30. The consumer price index was 122.0 in 1988 and 135.7 in 1989. The inflation rate for 1989 was an approximation of:
  31. As the price level falls the value of the dollar ___, and a _____ amount of money is required to purchase the same amount of output.
    increases; smaller
  32. Gross Domestic Product (GDP) measures the:
    total market value of all final goods and services produced within the US
  33. Purchases by Mexico of the U.S. produced cars would be in the U.S. GDP?
  34. The concept of value added refers to:
    the increase in the value of the product that occurs at each stage of production
  35. What is the best way to track economic growth?
    the percent change in real GDP