ECON 101 Exam Questions Answered Correctly Latest Update 2024 (Already Passed)
Margo spends $10,000 on one year's college tuition. The opportunity cost of spending one year in
college for Margo is:
A. $10,000
B. Whatever she would have purchased with the $10,000 instead.
C. Whatever she would have earned had she not been in college.
D. Whatever she would have purchased with the $10,000 and whatever she would have earned had she
not been in college. - Answers D.
The fundamental problem at the core of economic analysis is:
A. Understanding how resources can be used without causing scarcity.
B. The creation of nonscarce goods and the elimination of scarce goods.
C. Finding the way in which society can eliminate scarcity.
D. Understanding how resources are allocated among competing uses to best satisfy society's unlimited
wants. - Answers D.
A college student is faced with a difficult decision of how to spend one hour tonight. She could babysit
her professor's child at an hourly wage of $8, she could work at the college library at a wage of $10, or
she could finish her economics homework assignment. If she chooses to complete her homework
assignment, she has incurred an opportunity cost equal to:
A. $10
B. $8
C. $18
D. $0 - Answers A.
Water is considered a scarce good because:
A. scarce goods are less expensive.
B. not enough of it is available for all needs.
C. not enough of it is available for all needs and because it is less expensive.
D. it does not have any uses. - Answers B.
,Will, Bill and Phil each decide to study an extra hour for an exam. Instead of studying, they could have
either slept, played football, or watched TV. Which of the following statements are correct:
A. The opportunity costs of the three students must be the same because they all make the same
choice.
B. The students only made a rational choice if they do well on the exam.
C. Both a. and b.
D. none of the above. - Answers D.
Nara has gone to three movies already this week. She has some extra money, so she decides to go to
another. This statement best represents this economic concept:
A. Resources are scarce.
B. "How much" is a decision at the margin.
C. The real cost of something is what you must give up to get it.
D. There are gains from trade. - Answers B.
The condition of scarcity means that:
A. when the government produces something, there is no opportunity cost.
B. choices must be made in the allocation of productive resources.
C. you will not incur an opportunity cost if you make the right choice.
D. only a command economy can make efficient use of resources. - Answers B.
In economics usage, the word "marginal" means
A. that something is less good or substandard.
B. incremental.
C. situated on the border of a geographic area.
D. negligible. - Answers B.
A resource is:
A. anything that can be used to produce something else.
B. a sum of money used to start a business.
C. a physical attribute of land.
, D. an intangible aspect of a society, such as its culture. - Answers A.
Microeconomics deals with:
A. the working of the entire economy or large sectors of it.
B. economic growth.
C. individual decision makers in the economy.
D. gross domestic product. - Answers C.
The cost of leaving a championship soccer match before it ends is ________, while the cost of staying for
the entire match is ________.
A. the opportunity cost of not seeing the winning goal with two minutes to go; zero—the ticket to the
match is already paid so there is no cost
B. the opportunity cost of not seeing the winning goal with two minutes to go; the opportunity cost of
what else you could have done during that time
C. zero—you don't have to pay to leave; zero—the ticket to the match is already paid so there is no cost
D. the cost of the ticket; also the cost of the ticket - Answers B.
Intel finds it difficult to hire enough skilled computer engineers. This statement best represents this
economic concept:
A. Resources are scarce.
B. People usually exploit opportunities to make themselves better off.
C. There are gains from trade.
D. One person's spending is another person's income. - Answers A.
If a production possibility frontier is a straight line, it tells us that the opportunity cost of producing one
more unit of good X:
A. is equal to the inverse of the amount of good Y.
B. is a decreasing amount of good Y.
C. is a constant amount of good Y.
D. is an increasing amount of good Y. - Answers C.
If a country specializes according to its own comparative advantage and then trades with other nations:
Margo spends $10,000 on one year's college tuition. The opportunity cost of spending one year in
college for Margo is:
A. $10,000
B. Whatever she would have purchased with the $10,000 instead.
C. Whatever she would have earned had she not been in college.
D. Whatever she would have purchased with the $10,000 and whatever she would have earned had she
not been in college. - Answers D.
The fundamental problem at the core of economic analysis is:
A. Understanding how resources can be used without causing scarcity.
B. The creation of nonscarce goods and the elimination of scarce goods.
C. Finding the way in which society can eliminate scarcity.
D. Understanding how resources are allocated among competing uses to best satisfy society's unlimited
wants. - Answers D.
A college student is faced with a difficult decision of how to spend one hour tonight. She could babysit
her professor's child at an hourly wage of $8, she could work at the college library at a wage of $10, or
she could finish her economics homework assignment. If she chooses to complete her homework
assignment, she has incurred an opportunity cost equal to:
A. $10
B. $8
C. $18
D. $0 - Answers A.
Water is considered a scarce good because:
A. scarce goods are less expensive.
B. not enough of it is available for all needs.
C. not enough of it is available for all needs and because it is less expensive.
D. it does not have any uses. - Answers B.
,Will, Bill and Phil each decide to study an extra hour for an exam. Instead of studying, they could have
either slept, played football, or watched TV. Which of the following statements are correct:
A. The opportunity costs of the three students must be the same because they all make the same
choice.
B. The students only made a rational choice if they do well on the exam.
C. Both a. and b.
D. none of the above. - Answers D.
Nara has gone to three movies already this week. She has some extra money, so she decides to go to
another. This statement best represents this economic concept:
A. Resources are scarce.
B. "How much" is a decision at the margin.
C. The real cost of something is what you must give up to get it.
D. There are gains from trade. - Answers B.
The condition of scarcity means that:
A. when the government produces something, there is no opportunity cost.
B. choices must be made in the allocation of productive resources.
C. you will not incur an opportunity cost if you make the right choice.
D. only a command economy can make efficient use of resources. - Answers B.
In economics usage, the word "marginal" means
A. that something is less good or substandard.
B. incremental.
C. situated on the border of a geographic area.
D. negligible. - Answers B.
A resource is:
A. anything that can be used to produce something else.
B. a sum of money used to start a business.
C. a physical attribute of land.
, D. an intangible aspect of a society, such as its culture. - Answers A.
Microeconomics deals with:
A. the working of the entire economy or large sectors of it.
B. economic growth.
C. individual decision makers in the economy.
D. gross domestic product. - Answers C.
The cost of leaving a championship soccer match before it ends is ________, while the cost of staying for
the entire match is ________.
A. the opportunity cost of not seeing the winning goal with two minutes to go; zero—the ticket to the
match is already paid so there is no cost
B. the opportunity cost of not seeing the winning goal with two minutes to go; the opportunity cost of
what else you could have done during that time
C. zero—you don't have to pay to leave; zero—the ticket to the match is already paid so there is no cost
D. the cost of the ticket; also the cost of the ticket - Answers B.
Intel finds it difficult to hire enough skilled computer engineers. This statement best represents this
economic concept:
A. Resources are scarce.
B. People usually exploit opportunities to make themselves better off.
C. There are gains from trade.
D. One person's spending is another person's income. - Answers A.
If a production possibility frontier is a straight line, it tells us that the opportunity cost of producing one
more unit of good X:
A. is equal to the inverse of the amount of good Y.
B. is a decreasing amount of good Y.
C. is a constant amount of good Y.
D. is an increasing amount of good Y. - Answers C.
If a country specializes according to its own comparative advantage and then trades with other nations:
