1) In Adam Smith's view of capitalism

a)a country should emphasize exports over imports to enhance its wealth

b)the government should play a major role in allocating resources

c)specialization would lead to worker alienation , not increased productivity

d)people acting in their won self-interest unwittingly do good for others

2)All of these are advantages of a Corporation except one.Choose the exception

a)Limited liability of the owner

b)Efficiency

c)Unlimited financial resources

d)Easy to form

3)All of these are advantagse of a sole proprietorship or partnership except one. Choose the exception

a)Easy to form

b)Flexible

c)unlimited financial resources

d)Don't have to share profits

4) Three major factors of production are natural, human, and capital resources. Which of the following groups best illustrates these three factors?

a)Rent, workers, and money

b)Oil, taxi drivers, and bonds

c)Iron ore, teachers, and truck

d)Farmers, investors, and manufacturers

Question 3 1 pts

Because there is not enough in the world to satisfy everyone's desire we have to do all of these but one. Choose the exception.

Group of answer choices

decide what to do with what we do have

live with the fact that certain groups of people will be excluded from the use of certain resources

face disagreements with those who want what we want

Consume as much as we can now before we run out

Flag this Question Question 4 1 pts

In a market economy, the social purpose of profits is to:

Group of answer choices

transfer income from the poor to the rich

get businesses to follow government regulations

get businesses to produce what consumers demand.

provide funds to pay workers better wages

Flag this Question Question 5 1 pts

Specialization and division of labor by nations followed by increasing international trade probably would

Group of answer choices

increase total world production of goods and services

increase differences in standards of living among nations

lower living standards in the poor nations of the world

increase the likelihood of worldwide unemployment

Flag this Question Question 6 1 pts

A production possibility curve / frontier indicates the:

Group of answer choices

Average combinations of goods and services an economy can produce given its available resources and technology

Maximum combinations of goods and services an economy can produce given unlimited resources

Maximum combinations of goods and services an economy can produce given its available resources and technology.

Combinations of goods and services an economy is actually producing.

Flag this Question Question 7 1 pts

If an economy is producing on its production possibility curve, then producing:

Group of answer choices

Less of one good implies producing less of another good

More of one good implies producing more of another good

More of one good implies shifting the curve toward the origin

More of one good implies producing less of another good

Flag this Question Question 8 1 pts

All of these will cause your production possibility curve to shift out except one. Choose the exception

Group of answer choices

investment in capital equipment

improved education of population

a pandemic

improved health of population

Flag this Question Question 9 1 pts

The opportunity cost of doing something is

Group of answer choices

The amount of time you spend doing it

The value of the best other thing you could be doing instead

The value of anything else you could be doing instead.

The amount of money you spend doing it

Flag this Question Question 10 1 pts

If an economy is producing inside the production-possibilities curve, then

Group of answer choices

It does not have enough resources to be efficient

It must give up some of one good to produce more of another good.

The curve needs to shift inward

It is using its resources inefficiently

Flag this Question Question 11 1 pts

In a market economy, if people act in their own self-interest, the result will be

Group of answer choices

the economy would fall apart because everything would be disorganized

the goods people want to buy will be produced at prices people are willing to pay

people would end up producing things that no one wanted to buy

prices will be so high that no one will be able to afford anything

Flag this Question Question 12 1 pts

Which of the following in NOT a basic decision that all nations must confront?

Group of answer choices

What goods and services should be produced?

Should we have economic growth

For whom should goods and services be produced?

How should we produce goods and services?

Flag this Question Question 13 1 pts

In a market economy, the question of WHAT to produce is answered by

Group of answer choices

Direct negotiations between consumers and producers

A democratic vote of all producers

Producer profits and sales

Government directives

Flag this Question Question 14 1 pts

In a market economy, the people who receive the goods and services that are produced are those who:

Group of answer choices

Are willing and able to pay.

Have the most political power

Want the goods and services the most.

Need the goods and services the most.

Flag this Question Question 15 1 pts

The invisible hand refers to:

Group of answer choices

The person who has the responsibility to coordinate all the markets in a market economy

Undiscovered natural resources

Intervention in the economy by the government bureaucrats we do not see and over whom we have no control.

The allocation of resources by market forces

Flag this Question Question 16 1 pts

In a market economy, what coordinates peoples actions to produce useful results?

Group of answer choices

The Government.

Prices

Violence.

A central planning agency

Flag this Question Question 17 1 pts

How can society produce the right amount of goods (the amount that consumers are willing to buy)?

Group of answer choices

The only solution is to have a government central planning agency control production

Laws must be passed making it illegal to produce too little or too much

There is no way to produce the right amount of goods

Consumers can tell producers how much to produce by the dollars they are willing to spend.

Flag this Question Question 18 1 pts

All of these are reasons the private sector is able to make better economic decisions than the government except one. Choose the exception

Group of answer choices

risking their own money

government always responds faster because of central planning

ability to immediately apply information

decisions are made based upon market factors

Flag this Question Question 19 1 pts

Comparative advantage refers to the ability to produce a good at a

Group of answer choices

Lower opportunity cost than your trading partner

Lower absolute cost of production than your trading partner

Higher absolute cost than your trading partner

Higher opportunity cost than your trading partner

Flag this Question Question 20 1 pts

Assume that land in an agricultural economy can be used either for producing grain or for grazing cattle to produce beef. The opportunity cost of converting an acre from cattle grazing to grain production is the

Group of answer choices

amount by which beef production decreases

number of extra bushels of grain that are produced

total amount of beef produced

market value of the extra grain that is produced

Flag this Question Question 21 1 pts

Once a resource has been used and cannot be recovered it is no longer a factor in future decisions because it is now a:

Group of answer choices

Marginal Cost

Opportunity Cost

Sunk Cost

Financial Cost

Flag this Question Question 22 1 pts

Suppose that, in order to use its land to grow wheat, the United States buys rice from Taiwan even though the United States can produce rice more efficiently. Which of the following must be true?

Group of answer choices

The United States has a comparative advantage in growing rice

Taiwan has a comparative advantage in growing rice

Taiwan has a production advantage in growing rice

Taiwan has an absolute advantage in growing rice.

Flag this Question Question 23 1 pts

If Britain has a comparative advantage over France in the production of cars, then

Group of answer choices

Briton will benefit from a decline in the demand for cars

the opportunity cost of producing cars in Briton is lower than in France

there are no gains from specialization and trade in cars between Briton and France

the opportunity cost of producing cars in Briton is higher than in France

Flag this Question Question 24 1 pts

A ballet performance had many empty seats. This implies that the:

Group of answer choices

Price of the tickets must of been very low because of the low demand

Hall where the performance was being held was very large

Ballet group was not very well known

Price of the tickets must have been above the equilibrium price

Flag this Question Question 25 1 pts

If the quantity demanded of a good is greater than the quantity supplied of the good at the current price, then:

Group of answer choices

The demand curve will shift to the left to create an equilibrium

Price will increase until it reaches the equilibrium price.

There is a surplus of the good

The supply curve will shift to the right to create an equilibrium

Flag this Question Question 26 1 pts

If the quantity supplied of a good is greater than the quantity demanded of the good at the current price, then

Group of answer choices

There is a surplus of the good

The supply curve will shift to the right to create an equilibrium

The demand curve will shift to the left to create an equilibrium

Price will increase until it reaches the equilibrium price

Flag this Question Question 27 1 pts

An established minimum price that buyers must pay for a product or service is called

Group of answer choices

Market price

Price floor

Price ceiling

Equilibrium price

Flag this Question Question 28 1 pts

Draw a supply and demand graph for the market for Houses and Carpenters wages double. What was the change on your graph?

Group of answer choices

Demand increases

Supply decreases

Supply increases

Demand decreases

Flag this Question Question 29 1 pts

The market is for Houses and Carpenters wages double. What variable of Supply and Demand is affected?

Group of answer choices

availability of resources

number of consumers in the market

price of other or related goods

cost of resources

Flag this Question Question 30 1 pts

From your graph for the market for Houses and Carpenters wages double what happens to the price and quantity of houses.

Group of answer choices

price will increase and quantity will decrease.

price will decrease and quantity will increase

price and quantity will both rise

price and quantity will both decrease

Flag this Question Question 31 1 pts

The market is for Mexican food and Mexico has an all time record high tortilla harvest. What variable of Supply and Demand is affected?

Group of answer choices

cost of resources

number of producers

compliment

availability of resources

Flag this Question Question 32 1 pts

Draw a supply and demand graph for Mexican food and Mexico has an all time record high tortilla harvest, What was the change on your graph?

Group of answer choices

Demand increases

Demand decreases

Supply increases

Supply decreases

Flag this Question Question 33 1 pts

From your graph for the market for Mexican food and Mexico has an all time record high tortilla harvest what will happen to the price and quantity of Mexican food

Group of answer choices

price will decrease and quantity will increase

price and quantity will both decrease

price and quantity will both rise

price will increase and quantity will decrease

Flag this Question Question 34 1 pts

The market is for Beer and the legal drinking age is lowered to 19. What variable of Supply and Demand is affected?

Group of answer choices

compliment

number of consumers in the market

cost of resources

number of producers

Flag this Question Question 35 1 pts

Draw a supply and demand graph for the market for Beer and the legal drinking age is lowered to 19, What was the change on your graph?

Group of answer choices

Supply increases

Demand increases

Supply decreases

Demand decreases

Flag this Question Question 36 1 pts

From your graph for the market for Beer and the legal drinking age is lowered to 19 what will happen to the price and quantity of beer.

Group of answer choices

price and quantity will both rise

price and quantity will both decrease

price will increase and quantity will decrease

price will decrease and quantity will increase

Flag this Question Question 37 1 pts

The market is for Chevy Cars and the price of Honda Cars falls. What variable of Supply and Demand is affected?

Group of answer choices

cost of resources

price of other or related goods

availability of resources

number of consumers in the market

Flag this Question Question 38 1 pts

Draw a supply and demand graph for Chevy Cars and the price of Honda Cars falls.. What was the change on your graph?

Group of answer choices

Supply increases

Demand decreases

Supply decreases

Demand increases

Flag this Question Question 39 1 pts

From your graph for the market for what will happen to the price and quantity of Chevys

Group of answer choices

price and quantity will both decrease

price will decrease and quantity will increase.

price and quantity will both rise

price will increase and quantity will decrease

Flag this Question Question 40 1 pts

Suppose a city eliminates rent controls at a time when the vacancy rate for housing is extremely low . Which of the following is most likely to occur?

Group of answer choices

an increase in rents, followed by an increase in the number of housing units supplied.

no change in rents, since price controls are usually set where supply and demand curves intersect.

a decrease in rents, followed by a decrease in the number of housing units supplied.

an increase in the demand for housing, followed by a decrease in the number of housing units supplied.

Flag this Question Question 41 1 pts

As more sewage processing plants are built and put into operation, more fertilizer may be produced as a byproduct. If that happens, fertilizer will be:

Group of answer choices

more expensive

less expensive

increasingly scarce

wanted less

Flag this Question Question 42 1 pts

If a firm is making a profit this means that

Group of answer choices

consumers value what the firm produces more than other things which could be produced with the same resources

the firm has not yet paid it's taxes

people will be discouraged from going into that line of business

workers in the firm are being underpaid

Flag this Question Question 43 1 pts

An increase in the supply of gasoline will cause equilibrium

Group of answer choices

Price to rise and quantity to fall.

Price and quantity to rise

Price and quantity to fall

Price to fall and quantity to rise

Flag this Question Question 44 1 pts

When the market mechanism is allowed to operate freely prices will determine:all but one. Choose the exception

Group of answer choices

What mix of resources will be used in the production of goods and services

Government control is always the most efficient

The mix of goods and services to be produced

Who will get the goods and services that are produced

Flag this Question Question 45 1 pts

Suppose a hurricane hits Florida causing widespread damage to houses and businesses. The governor of Florida places a price ceiling on all building materials to keep the prices reasonable. Which of the following is the most likely to occur?

Group of answer choices

People moving to Alaska

A faster recovery from the storm.

More people will be able to afford and purchase building materials.

Shortages of building materials and a slower recovery from the storm

Flag this Question Question 46 1 pts

If the price of a resource used to produce wheat goes up

Group of answer choices

The supply of what will increase since the cost of producing wheat will go up

The supply of wheat will decrease since the cost of producing wheat will go up

The supply of wheat will increase since the cost of producing wheat will go down

The supply of wheat will decrease since the cost of producing wheat will down

Flag this Question Question 47 1 pts

When price controls cause people to wait in line to purchase goods, the effect on the real cost of the good is that

Group of answer choices

the cost is lower for everyone

the cost is lower for busy, employed persons with high incomes

the cost is higher for those who are retired or unemployed.

the cost is higher for those whose time is valuable

Flag this Question Question 48 1 pts

If people want to buy more of an item than is available

Group of answer choices

the only way to make the amount demanded equal to the amount supplied is to decrease the demand for that item.

the only way to make the amount demanded equal to the amount supplied is to increase the supply of that item.

the price could be raised to make the amount demanded equal to the amount supplied

the price could be lowered to make the amount demanded equal to the amount supplied

Flag this Question Question 49 1 pts

According to the "Laws of Supply and Demand" if twice as many heads of lettuce were grown this year because of good weather than were grown last year

Group of answer choices

the demand for lettuce would go down this year

the supply of lettuce would stay the same this year

the price of lettuce would go up this year

the price of lettuce would go down this year.

Flag this Question Question 50 1 pts

In a market economy, which of the following is an incentive for producers to produce efficiently?

Group of answer choices

Profits.

Government laws and regulations

The production-possibilities curve

The public's welfare.

Flag this Question Question 51 1 pts

A market is said to be in equilibrium when:

Group of answer choices

The quantity demanded equals the quantity supplied

Demand is fully satisfied at all alternative prices

The buying intentions of all consumers are realized

The supply intentions of all producers are realized

Flag this Question Question 52 1 pts

The price a producer can get for a product affects all but one. Choose the exception

Group of answer choices

the competition he will face

his willingness to produce it

the amount he will produce

the amount of government regulation needed by the government

Flag this Question Question 53 1 pts

When a surplus exists

Group of answer choices

Producers reduce price in an attempt to decrease existing inventory

Producers increase price in an attempt to increase existing inventory

Consumers buy more of the good because they know a surplus exists

Government officials offer more subsidies

Flag this Question Question 54 1 pts

If the quantity demanded of a good is greater than the quantity supplied of the good at the current price, then:

Group of answer choices

Price will increase until it reaches the equilibrium price

The demand curve will shift to the left to create an equilibrium

The supply curve will shift to the right to create an equilibrium

There is a surplus of the good

Flag this Question Question 55 1 pts

A firm will continue to produce at a loss rather than shut down if:

Group of answer choices

It meets all of it's fixed costs.

Never, firms will shut down rather than operate at a loss

It meets all of it's variable costs and some of it's fixed costs

It meets some of it's marginal costs.

Flag this Question Question 56 1 pts

In a market economy, the people who receive the goods and services produced are those who:

Group of answer choices

Have the most political power.

Want the goods and services the most.

Are willing and able to pay the market price.

Need the goods and services the most

Flag this Question Question 57 1 pts

An increase in the price of one good can cause a decrease in the demand for another good if the goods are:

Group of answer choices

Complements

Unrelated to each other

Substitutes

If both goods are inferior