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JCCC Macro Exam 1&2 Questions and Answers
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JCCC Macro Exam 1&2 Questions andAnswers
Suppose that a university decides to spend $1 million to upgrade personal computers
and scientific equipment for faculty rather than spend $1 million to expand parking for
students. This example illustrates - Answer-Opportunity Costs
Which of the following statements pertains to macroeconomics? - Answer-National
income grew by 2.7 percent last year.
A positive statement is concerned primarily with - Answer-What is.
The economizing problem is one of deciding how to make the best use of - Answer-
limited resources to satisfy virtually unlimited wants
Which question is an example of a macroeconomic question? - Answer-What policies
would be recommended for stimulating national economic growth?
Matt observes that "there is a high correlation between educational attainment and the
level of income." Jean concurs and adds that "high school graduates should all proceed
to college." - Answer-Matt's statement is positive, while Jean's statement is normative.
Which one of the following is a normative economic statement? - Answer-The
worsening balance of trade must be corrected if this nation is to remain competitive in
the world economy.
Which of the following is considered an economic resource? - Answer-the land that is
designated as national parks by the government
A point inside the production possibilities curve is __________, while a point outside the
curve is __________. - Answer-attainable; unattainable
The law of increasing opportunity costs states that - Answer-if society wants to produce
more of a particular good, it must sacrifice larger and larger amounts of another good to
do so.
All of the following could immediately or eventually lead to an inward shift of a nation's
production possibilities curve, except
a.emigration of skilled workers to other nations.
b.a decline in the birthrate.
c.an increase in the average skill level of all occupational groups.
d.depletion and reduced availability of major energy resources. - Answer-C
The French term "laissez-faire" means - Answer-"let it be."
, A fundamental difference between the command system and laissez-faire capitalism is
that, in command systems, - Answer-the division of output is decided by central
planning rather than by individuals operating freely through markets.
Broadly defined, competition involves - Answer-independently acting buyers and sellers
and freedom to enter or leave markets.
The competitive market system - Answer-encourages innovation because successful
innovators are rewarded with economic profits.
Which of the following is not one of the five fundamental questions?
a.What prices will be charged for goods and services?
b.Who will get the goods and services?
c.What goods and services will be produced?
d.How will the system promote progress? - Answer-A
The two basic markets shown by the simple circular flow model are - Answer-product
and resource.
In the circular flow diagram, households get their ability to pay for their consumption
expenditures from the - Answer-incomes they earn for their resources.
Countries engaged in international trade specialize in production based on - Answer-
comparative advantage.
If a nation has a comparative advantage in the production of X, this means the nation -
Answer-must give up less of other goods than other nations in producing a unit of X.
Tariffs - Answer-may be imposed either to raise revenue (revenue tariffs) or to shield
domestic producers from foreign competition (protective tariffs).
Country A limits other nation's exports to Country A to 1,000 tons of coal annually. -
Answer-import quota.
Which is an example of a nontariff barrier (NTB)? - Answer-box-by-box inspection
requirements for imported fruit
The World Trade Organization - Answer-was established to resolve disputes arising
under world trade rules.
NAFTA - Answer-has reduced most trade barriers between Canada, Mexico, and the
United States.
International trade based on the principle of comparative advantage creates a more
efficient allocation of world economic resources. - Answer-True
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