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Eco 202 Exam Elaborations: Questions & Answers
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Eco 202 Exam Elaborations: Questions & Answers
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Eco 202 Exam Elaborations: Questions & AnswersAn increase in demand is shown graphically by Right Ans - a shift of the
demand curve to the right
After the price of milk increases, David buys more eggs and less cereal for
David Right Ans - milk and eggs are substitutes and milk and cereal are
complements
Central planning is a key characteristic of which of which economic system
Right Ans - command and control
A country operates inside its production possibilites curve this may be caused
by Right Ans - unemployment resources
The production possibilities curve bows out because Right Ans - the law of
increasing additional cost
Which of the following is a normative economic statement Right Ans -
teenage unemployment is too high
The price floor set below the equilibrium price will cause which of the
following Right Ans - none of the above
Production refers to Right Ans - any activity that results in the conversion
of resources into goods and services that can be consumed
When an economy sacrifices production of consumption goods to produce
more capital goods we would expect that the production possibilities curve
will Right Ans - shift outward
The only way that a society can produce outside of the production possibilities
curve is Right Ans - through economic growth
Ceteteris paribus assumption means Right Ans - that nothing else changes
except the variables under constructions
, if a good is a normal good an increase in income will Right Ans - increase
the demand for the good
price ceilings set below the equilibrium price cause Right Ans - shortages
a black market is a market in which Right Ans - goods are traded at the
prices above their legal maximum prices
which of the following would be categorized as land Right Ans - timber
in the price system Right Ans - prices are set by the interaction of supply
and demand
comparative advantage is Right Ans - when a country can produce a good
at a lower opportunity cost compared to other countries
in the long run, the number of firms in an industry may change, if the number
of firms increase the Right Ans - the supply curve will shift outward to the
right
a change in the price of a good causes Right Ans - a change in quantity
supplied
physical capital is distinguished from human capital because Right Ans -
physical capital refers to equipment and machinery where as human capital
refers to trained people
suppose the price of cement goes up in the united states what happend in the
market for new homes Right Ans - supply shifts upward and to the left
if joey goes surfing for four hours instead of earning 10$ per hour for those
four hours his opportunity cost is Right Ans - 40
the real price of a good is known as Right Ans - relative price of a good
when there is an excess quantity of a product supplied there will be Right
Ans - a tendency for price of the product to fall
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