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StraighterlineECON 343 Exam 1 Questions and Answers 2024/2025( A+ GRADED 100% VERIFIED).
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StraighterlineECON 343 Exam 1The classical school supports which function of government? - ANS the first function of
government (i.e. providing competition and a system of laws, courts and justice)
Jill, an economics student, has already spent 5 hours cleaning her room. In deciding whether or
not to continue cleaning for another hour, she applies the economic principle of - ANS choosing
at the margin.
In economics, the term "capital" refers to: - ANS buildings and equipment.
Issues in which Adam Smith's invisible hand may not hold include: - ANS all of the answers are
true.
Factors of production include: - ANS land, labor, capital, entrepreneurship, technology
The loss of the highest-valued alternative defines the concept of: - ANS opportunity cost.
In broad terms the difference between microeconomics and macroeconomics is that: - ANS
microeconomics studies decisions of individual people and firms and macroeconomics studies
the entire national economy.
In every economic system, choices must be made because resources are ________ and our
wants are ________ . - ANS limited; unlimited
When an economist talks of scarcity, the economist is referring to the: - ANS inability of society
to satisfy all human wants because of limited resources.
The term ceteris paribus means: - ANS all other things remaining equal.
The birth of economics as an intellectual discipline can be dated fairly precisely in the
eighteenth century with: - ANS the publication of the book, The Wealth of Nations.
Scarcity arises from - ANS limited resources and limitless wants.
(Pure) private goods are: - ANS rival, divisible, and excludable.
An externality occurs when - ANS some of the costs of producing a good are paid by someone
other than the producer.
, A normative statement is - ANS about what ought to be.
When China builds a dam using few machines and a great deal of labor, it is answering the
________ question. - ANS "how"
A free rider is someone who - ANS enjoys the benefits of a good without paying for it.
The "big" tradeoff is between efficiency and equity (fairness) in any economy. - ANS True
According to Adam Smith, individuals acting in their own self-interest in the market place are
also unintentionally acting in the social interest. - ANS True
Free market economists (classical) are more likely to be allied with Republicans than are
Keynesian economists who are more likely to be allied with the Democrats. - ANS True
The percentage of U.S. workers employed in the services sector is far greater than most other
countries. This is because: - ANS the U.S. has one of the most productive agriculture and
manufacturing sectors which frees up labor for services.
Marginal cost is the cost: - ANS that arises from an increase in an activity.
The fallacy of composition is the false belief that: - ANS what is true for each part is also true for
the whole.
A negative externality is a: - ANS cost that arises from production and falls on someone other
than the producer.
A public good can be consumed by - ANS everyone simultaneously (nonrival), even if they do
not pay for it .
A system of property rights: - ANS encourages economic growth by creating incentives to
invest in capital and to be innovative.
Human capital is: - ANS the skill and knowledge of workers.
The 2007-2009 recession: (Class Discussion) - ANS was the worst recession since the Great
Depression 1929-1933.
The iron law of price is that it must rise before it can fall when a shortage occurs. - ANS True
Which function of government focuses on the business cycle? - ANS
Which function of government focuses on the business cycle? - ANS stabilization
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