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ASU Econ 211 Final Exam Questions and Answers 100% Correct |
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ASU Econ 211 Final Exam Questions andAnswers 100% Correct | 2024-2025
What does a production possibilities frontier display? - ANSWER Possible
combinations of output an economy can produce given available factors of
production and technology.
What is a normative statement? - ANSWER Policymakers should increase the
minimum wage to improve standard of living.
The opportunity cost of helping a friend move is... - ANSWER the next best use
of the time and energy spent helping your friend.
An entity has a comparative advantage if it can produce what? - ANSWER At a
lower opportunity cost than another entity.
T/F: Suppose the United States has an absolute advantage in the production of oil
and wheat. This means that the U.S. would not gain from trading these goods. -
ANSWER FALSE
The United States has a comparative advantage in the production of wheat and an
absolute advantage in the production of both apples and wheat relative to
Canada. If the U.S. and Canada specialize and trade, the U.S. should produce
what? - ANSWER Wheat
The law of the demand states that if price rises, quantity demanded does what? -
ANSWER Decreases
, We would expect demand for cars to increase if... - ANSWER The price of
gasoline falls.
As income increases, consumers purchase more cars. Cars what type of good? -
ANSWER Normal goods
Supply curves show the relationship between price and quantity demanded.
Assuming the law of supply holds, supply curves are what? - ANSWER Upward
sloping
Which causes a leftward shift in the supply curve for apples? - ANSWER An
increase in the price of labor
An increase in the equilibrium price of coffee could be caused by - ANSWER A
decrease in supply of coffee.
What is Consumer surplus? - ANSWER The amount a buyer is willing to pay for
a good less the amount the buyer actually pays.
When is a market is efficient? - ANSWER The sum of consumer and producer
surplus is maximized.
What is Producer surplus? - ANSWER The difference between the price
producers collect and the minimum price required to bring goods to market.
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