Full file at Test-Bank-for-Principles-of-Macroeconomics,-7th-Edition-N.-Gregory-Mankiw-
Ten Principles of Economics
Multiple Choice – Section 00: Introduction
1.TheEnglishwordthatcomesfromtheGreekwordfor"onewhomanagesahousehold"is
a.market.
b.consumer.
c.producer.
d.economy.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:GeneralPrinciples
KEYWORDS:BLOOM'S:Knowledge
2.Theword“economy”comesfromtheGreekwordoikonomos,whichmeans
a.“environment.”
b.“production.”
c.“onewhomanagesahousehold.”
d.“onewhomakesdecisions.”
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:GeneralPrinciples
KEYWORDS:BLOOM'S:Knowledge
3.Resourcesare
a.scarceforhouseholdsbutplentifulforeconomies.
b.plentifulforhouseholdsbutscarceforeconomies.
c.scarceforhouseholdsandscarceforeconomies.
d.plentifulforhouseholdsandplentifulforeconomies.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Comprehension
4.Inconsideringhowtoallocateitsscarceresourcesamongitsvariousmembers,ahouseholdconsiders
a.eachmember’sabilities.
b.eachmember’sefforts.
c.eachmember’sdesires.
d.Alloftheabovearecorrect.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Comprehension
5.Economicsdealsprimarilywiththeconceptof
a.scarcity.
b.money.
c.poverty.
d.banking.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Knowledge
6.Whichofthefollowingiscorrect?
a.ThewordeconomycomesfromtheGreekwordfor“rationalthinker.”
b.Economistsstudythemanagementofscarceresources.
c.Becauseeconomistsbelievethatpeoplepursuetheirbestinterests,theyarenotinterestedinhowpeopleinteract.
d.Alloftheabovearecorrect.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Knowledge
7.Theoverridingreasonwhyhouseholdsandsocietiesfacemanydecisionsisthat
a.resourcesarescarce.
b.goodsandservicesarenotscarce.
c.incomesfluctuatewithbusinesscycles.
d.people,bynature,tendtodisagree.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Comprehension
8.Asocietyallocatesitsscarceresourcestovariousjobs.Thesescarceresourcesinclude
a.land.
b.people.
c.machines.
d.Alloftheabovearecorrect.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Comprehension
NOTES:n
9.Thephenomenonofscarcitystemsfromthefactthat
a.mosteconomies’productionmethodsarenotverygood.
b.inmosteconomies,wealthypeopleconsumedisproportionatequantitiesofgoodsandservices.
c.governmentsrestrictproductionoftoomanygoodsandservices.
d.resourcesarelimited.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Comprehension
10.Approximatelywhatpercentageoftheworld'seconomiesexperiencescarcity?a.10%
b.40%
c.85%
d.100%
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Comprehension
11.Whenasocietycannotproduceallthegoodsandservicespeoplewishtohave,itissaidthattheeconomyisexperiencing
a.scarcity.
b.surpluses.
c.inefficiencies.
d.inequalities.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Comprehension
12.Whichofthefollowingproductswouldbeconsideredscarce?
a.bread
b.baseballsautographedbyBabeRuth
c.motorcycles
d.Alloftheabovearecorrect.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Comprehension
NOTES:r
13.Economicsisthestudyof
a.productionmethods.
b.howsocietymanagesitsscarceresources.
c.howhouseholdsdecidewhoperformswhichtasks.
d.theinteractionofbusinessandgovernment.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Knowledge
14.Thestudyofhowsocietymanagesitsscarceresourcesismostcloselyassociatedwithwhichfieldofstudy?
a.environmentalstudies
b.economics
c.management
d.accounting
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Knowledge
NOTES:n
15.Inmostsocieties,resourcesareallocatedby
a.asinglecentralplanner.
b.asmallnumberofcentralplanners.
c.thosefirmsthatuseresourcestoprovidegoodsandservices.
d.thecombinedactionsofmillionsofhouseholdsandfirms.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:GeneralPrinciples
KEYWORDS:BLOOM'S:Comprehension
16.Coalisconsideredtobeanon-renewableenergysource.Whichofthefollowingstatementsiscorrect?
a.Coalisanunlimitedresource.
b.Coalisascarceresource.
c.Coalisanon-productiveresource.
d.Coalisnotaresource.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Application
NOTES:r
17.Whichof the following isnotanexampleofscarcity?
a.OnlysomepeoplecanaffordtobuyaBMWautomobile.
b.Everyindividualinsocietycannotattainthehigheststandardoflivingtowhichheorshemightaspire.
c.Mirandahasanunlimitedsupplyoforangesinherorchard.
d.Eachmemberofahouseholdcannotgeteverythingheorshewants.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Application
NOTES:r
18.Economicsisthestudyofhowsocietymanagesits
a.limitedwantsandunlimitedresources.
b.unlimitedwantsandunlimitedresources.
c.limitedwantsandlimitedresources.
d.unlimitedwantsandlimitedresources.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Knowledge
19.Whichofthefollowingisadecisionthateconomistsstudy?
a.howmuchpeoplework
b.whatpeoplebuy
c.howmuchmoneypeoplesave
d.Alloftheabovearecorrect.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:GeneralPrinciples
KEYWORDS:BLOOM'S:Comprehension
20.Whichofthefollowingisanexampleofsomethingeconomistsstudy?
a.Mitchchoosestoworkovertimetoearnextraincomeforhisfamily.
b.Megansellsherphysicstextbookfromlastsemestertoherroommateforhalfthepriceofanewtextbook.
c.TheunemploymentrateintheUnitedStateshasfallenbytwopercentagepointsinthelastfewyears.
d.Alloftheabovearecorrect.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:GeneralPrinciples
KEYWORDS:BLOOM'S:Comprehension
NOTES:r
21.Whattermreferstothepropertythatsocietyhaslimitedresourcesandthereforecannotproduceallthegoodsandservicespeoplewishtohave?
a.inefficiency
b.inequality
c.scarcity
d.marketfailure
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistScarcity
KEYWORDS:BLOOM'S:Knowledge
22.Whichofthefollowingisasubjectthateconomistsstudy?
a.thegrowthinaverageincome
b.thefractionofthepopulationthatcannotfindwork
c.therateatwhichpricesarerising
d.Alloftheabovearecorrect.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.1-LO:1-0
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:GeneralPrinciples
KEYWORDS:BLOOM'S:Comprehension
Multiple Choice – Section 01: How People Make Decisions
1.Theadage,"Thereisnosuchthingasafreelunch,"means
a.evenpeopleonwelfarehavetopayforfood.
b.thecostoflivingisalwaysincreasing.
c.peoplefacetradeoffs.
d.allcostsareincludedinthepriceofaproduct.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Knowledge
2.Theadage,"Thereisnosuchthingasafreelunch,"isusedtoillustratetheprinciplethat
a.goodsarescarce.
b.peoplefacetradeoffs.
c.incomemustbeearned.
d.householdsfacemanydecisions.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Comprehension
3.Thephrase“nosuchthingasafreelunch”means
a.peoplemustfacetradeoffs.
b.rationalpeoplethinkatthemargin.
c.peoplerespondtoincentives.
d.tradecanmakeeveryonebetteroff.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Comprehension
4.Whichofthefollowingstatementsbestrepresentstheprinciplerepresentedbytheadage,"Thereisnosuchthingasafreelunch"?
a.Michellecanattendtheconcertonlyifshetakeshersisterwithher.
b.Michaelishungryandhomeless.
c.Andreamustrepairthetireonherbikebeforeshecanrideittoclass.
d.DanimustdecidebetweengoingtoFloridaorBrazilforspringbreak.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Challenging
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Application
NOTES:r
5.Whichofthefollowingexamplesdoesnotillustratetheprinciplerepresentedbytheadage,"Thereisnosuchthingasafreelunch"?
a.Melissaneedstopayherrentandherelectricbill.
b.Kevinmustchoosebetweenbuyinganewflatscreentelevisionandbuyinghistextbooksforthissemester.
c.Robertmustdecidebetweenstudyingforhispsychologyexamandworkingathispart-timejob.
d.Lisacanspendhermoneyonanewsmartphoneoronaweekendtrip.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Challenging
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Application
NOTES:r
6.Theprinciplethat"peoplefacetradeoffs"appliesto
a.individuals.
b.families.
c.societies.
d.Alloftheabovearecorrect.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Application
7.Candiceisplanningheractivitiesforahotsummerday.Shewouldliketogotothelocalswimmingpoolandseethelatestblockbustermovie,butbecauseshecanonlygetticketstothemovieforthesametimethatthepoolisopenshecanonlychooseoneactivity.Thisillustratesthebasicprinciplethat
a.peoplerespondtoincentives.
b.rationalpeoplethinkatthemargin.
c.peoplefacetradeoffs.
d.improvementsinefficiencysometimescomeattheexpenseofequality.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Comprehension
NOTES:r
8.BillieJeanhas$120tospendandwantstobuyeitheranewamplifierforherguitaroranewmp3playertolistentomusic whileworking out.Boththeamplifierandthemp3playercost$120,soshecanonlybuyone.Thisillustratesthebasicconceptthat
a.tradecanmakeeveryonebetteroff.
b.peoplefacetrade-offs.
c.rationalpeoplethinkatthemargin.
d.decisionsmadeatthemarginarenotparticularlyimportant.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Comprehension
NOTES:r
9.Johnisanathlete.Hehas$120tospendandwantstobuyeitheraheartratemonitorornewrunningshoes.Boththeheartratemonitorandrunningshoescost$120,sohecanonlybuyone.Thisillustratestheprinciplethat
a.tradecanmakeeveryonebetteroff.
b.peoplefacetrade-offs.
c.rationalpeoplethinkatthemargin.
d.peoplerespondtoincentives.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Comprehension
10.Lawrenceisaphotographer.Hehas$230tospendandwantstobuyeitheraflashforhiscameraoranewtripod.Boththeflashandtripodcost$230,sohecanonlybuyone.Thisillustratestheprinciplethat
a.tradecanmakeeveryonebetteroff.
b.peoplefacetrade-offs.
c.rationalpeoplethinkatthemargin.
d.peoplerespondtoincentives.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Comprehension
NOTES:r
11.Gunsandbutterareusedtorepresenttheclassicsocietaltradeoffbetweenspendingon
a.durableandnondurablegoods.
b.importsandexports.
c.nationaldefenseandconsumergoods.
d.lawenforcementandagriculture.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Comprehension
12.Atradeoffexistsbetweenacleanenvironmentandahigherlevelofincomeinthat
a.studiesshowthatindividualswithhigherlevelsofincomepollutelessthanlow-incomeindividuals.
b.effortstoreducepollutiontypicallyarenotcompletelysuccessful.
c.lawsthatreducepollutionraisecostsofproductionandreduceincomes.
d.employingindividualstocleanuppollutioncausesincreasesinemploymentandincome.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Application
13.Whilepollutionregulationsyieldthebenefitofacleanerenvironmentandtheimprovedhealththatcomeswithit,theregulationscomeatthecostofreducingtheincomesoftheregulatedfirms’owners,workers,andcustomers.Thisstatementillustratestheprinciplethat
a.tradecanmakeeveryonebetteroff.
b.rationalpeoplethinkatthemargin.
c.peoplefacetradeoffs.
d.peoplerespondtoincentives.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Application
14.Whensocietyrequiresthatfirmsreducepollution,thereis
a.atradeoffbecauseofreducedincomestothefirms'ownersandworkers.
b.atradeoffonlyifsomefirmsareforcedtoclose.
c.notradeoff,sincethecostofreducingpollutionfallsonlyonthefirmsaffectedbytherequirements.
d.notradeoff,sinceeveryonebenefitsfromreducedpollution.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Challenging
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistTradeoffs
KEYWORDS:BLOOM'S:Application
15.Economistsusethewordequalitytodescribeasituationinwhich
a.eachmemberofsocietyhasthesameincome.
b.eachmemberofsocietyhasaccesstoabundantquantitiesofgoodsandservices,regardlessofhisorherincome.
c.societyisgettingthemaximumbenefitsfromitsscarceresources.
d.society'sresourcesareusedefficiently.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Comprehension
16.Efficiencymeansthat
a.societyisconservingresourcesinordertosavethemforthefuture.
b.society'sgoodsandservicesaredistributedequallyamongsociety'smembers.
c.society'sgoodsandservicesaredistributedfairly,thoughnotnecessarilyequally,amongsociety'smembers.
d.societyisgettingthemaximumbenefitsfromitsscarceresources.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEfficiency
KEYWORDS:BLOOM'S:Knowledge
17.Thepropertyofsocietygettingthemostitcanfromitsscarceresourcesiscalled
a.efficiency.
b.equality.
c.externality.
d.productivity.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEfficiency
KEYWORDS:BLOOM'S:Knowledge
18.Efficiency
a.andequalitybothrefertohowmuchasocietycanproducewithitsresources.
b.andequalitybothrefertohowfairlythebenefitsfromusingresourcesaredistributedbetweenmembersofasociety.
c.referstohowmuchasocietycanproducewithitsresources.Equalityreferstohowevenlythebenefitsfromusingresourcesaredistributedamongmembersofsociety.
d.referstohowevenlythebenefitsfromusingresourcesaredistributedbetweenmembersofsociety.Equalityreferstohowmuchasocietycanproducewithitsresources
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEfficiency
KEYWORDS:BLOOM'S:Knowledge
19.Thetermsequalityandefficiencyaresimilarinthattheybothrefertobenefitstosociety.Howevertheyaredifferentinthat
a.equalityreferstouniformdistributionofthosebenefitsandefficiencyreferstomaximizingbenefitsfromscarceresources.
b.equalityreferstomaximizingbenefitsfromscarceresourcesandefficiencyreferstouniformdistributionofthosebenefits.
c.equalityreferstoeveryonefacingidenticaltradeoffsandefficiencyreferstotheopportunitycostofthebenefits.
d.equalityreferstotheopportunitycostofthebenefitsandefficiencyreferstoeveryonefacingidenticaltradeoffs.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Knowledge
20.Whichofthefollowingphrasesbestcapturesthenotionofefficiency?
a.absolutefairness
b.equaldistribution
c.minimumwaste
d.equitableoutcome
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEfficiency
KEYWORDS:BLOOM'S:Comprehension
21.Whichofthefollowingwordsandphrasesbestcapturesthenotionofequality?
a.minimumwaste
b.maximumbenefit
c.sameness
d.efficiency
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Knowledge
22.Whensocietygetsthemostitcanfromitsscarceresources,thentheoutcomeiscalled
a.equitable.
b.efficient.
c.normal.
d.efficacious.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEfficiency
KEYWORDS:BLOOM'S:Knowledge
NOTES:r
23.Atypicalsocietystrivestogetthemostitcanfromitsscarceresources.Atthesametime,thesocietyattemptstodistributethebenefitsofthoseresourcestothemembersofthesocietyinafairmanner.Inotherwords,thesocietyfacesatradeoffbetween
a.gunsandbutter.
b.efficiencyandequality.
c.inflationandunemployment.
d.workandleisure.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEfficiency
KEYWORDS:BLOOM'S:Comprehension
24.Whenthegovernmentredistributesincomefromthewealthytothepoor,
a.efficiencyisimproved,butequalityisnot.
b.equalityisimproved,butefficiencyisnot.
c.bothefficiencyandequalityareimproved.
d.neitherefficiencynorequalityareimproved.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Comprehension
25.Whichofthefollowingistrue?
a.Efficiencyreferstothesizeoftheeconomicpie;equalityreferstohowthepieisdivided.
b.Governmentpoliciesusuallyimproveuponbothequalityandefficiency.
c.Aslongastheeconomicpiecontinuallygetslarger,noonewillhavetogohungry.
d.Efficiencyandequalitycanbothbeachievediftheeconomicpieiscutintoequalpieces.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomist
KEYWORDS:BLOOM'S:Comprehension
26.Asaresultofasuccessfulattemptbygovernmenttocuttheeconomicpieintomoreequalslices,
a.thepiegetslarger,andtherewillbemorepieoverall.
b.thepiegetssmaller,andtherewillbelesspieoverall.
c.itincreasestherewardforworkinghard,resultinginpeopleproducingmoregoodsandservices.
d.thosewhoearnmoreincomepaylessintaxes.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Challenging
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Analysis
27.Whenthegovernmentredistributesincomefromthewealthytothepoor,
a.efficiencyisimproved,butequalityisnot.
b.bothwealthypeopleandpoorpeoplebenefitdirectly.
c.peopleworklessandproducefewergoodsandservices.
d.thegovernmentcollectsmorerevenueintotal.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Comprehension
28.Whenthegovernmentattemptstoimproveequalityinaneconomytheresultisoften
a.anincreaseinoveralloutputintheeconomy.
b.additionalgovernmentrevenuesinceoverallincomewillincrease.
c.areductioninequality.
d.areductioninefficiency.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEfficiency
KEYWORDS:BLOOM'S:Comprehension
29.Whenthegovernmentimplementsprogramssuchasprogressiveincometaxrates,whichofthefollowingislikelytooccur?
a.equalityisincreasedandefficiencyisincreased.
b.equalityisincreasedandefficiencyisdecreased.
c.equalityisdecreasedandefficiencyisincreased.
d.equalityisdecreasedandefficiencyisdecreased.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Comprehension
30.Alikelyeffectofgovernmentpoliciesthatredistributeincomeandwealthfromthewealthytothepooristhatthosepolicies
a.enhanceequality.
b.reduceefficiency.
c.reducetherewardforworkinghard.
d.Alloftheabovearecorrect.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Comprehension
31.Alikelyeffectofgovernmentpoliciesthatredistributeincomeandwealthfromthewealthytothepooristhatthosepolicies
a.enhanceequality.
b.enhanceefficiency.
c.increasetherewardforworkinghard.
d.Alloftheabovearecorrect.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Comprehension
NOTES:n
32.Governmentpoliciesdesignedtoequalizethedistributionofeconomicwell-beinginclude
(i)thewelfaresystem
(ii)unemploymentinsurance
(iii)progressiveincometax
a.(i)only
b.(ii)only
c.(i)and(ii)only
d.(i),(ii),and(iii)
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Application
33.Governmentpoliciesresultinginreducedefficiencyinclude
(i)thewelfaresystem
(ii)unemploymentinsurance
(iii)progressiveincometax
a.(i)only
b.(ii)only
c.(i)and(ii)only
d.(i),(ii),and(iii)
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEfficiency
KEYWORDS:BLOOM'S:Application
34.Whengovernmentpoliciesareenacted,
a.equalitycanusuallybeenhancedwithoutanefficiencyloss,butefficiencycanneverbeenhancedwithoutareductioninequality.
b.efficiencycanusuallybeenhancedwithoutareductioninequality,butequalitycanneverbeenhancedwithoutanefficiencyloss.
c.itisalwaysthecasethateitherefficiencyandequalityarebothenhanced,orefficiencyandequalityarebothdiminished.
d.Noneoftheabovearecorrect.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomist
KEYWORDS:BLOOM'S:Application
35.SenatorBrownwantstoincreasetaxesonpeoplewithhighincomesandusethemoneytohelpthepoor.SenatorJohnsonarguesthatsuchataxwilldiscouragesuccessfulpeoplefromworkingandwillthereforemakesocietyworseoff.Aneconomistwouldsaythat
a.weshouldagreewithSenatorBrown.
b.weshouldagreewithSenatorJohnson.
c.agooddecisionrequiresthatwerecognizebothviewpoints.
d.therearenotradeoffsbetweenequityandefficiency.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomist
KEYWORDS:BLOOM'S:Application
36.Acertainstatelegislatureisconsideringanincreaseinthestategasolinetax.RepresentativeCampbellarguesthatanincreaseinthegasolinetaxwouldharmlow-incomedriversdisproportionately.RepresentativeRichardsrespondsbysayingthatlow-incomedriversownsmallercarsthatuselessgasoline,andthatlow-incomedriversthereforewouldnotbeharmeddisproportionately.
a.RepresentativeCampbell’sargumentisbasedprimarilyonefficiency,whileRepresentativeRichards’argumentisbasedprimarilyonequality.
b.RepresentativeCampbell’sargumentisbasedprimarilyonequality,whileRepresentativeRichards’argumentisbasedprimarilyonefficiency.
c.Bothrepresentatives’argumentsarebasedprimarilyonefficiency.
d.Bothrepresentatives’argumentsarebasedprimarilyonequality.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Application
NOTES:n
37.SenatorJacksonarguesthatreplacingthefederalincometaxwithanationalsalestaxwouldincreasethelevelofoutput.SenatorFeldmanobjectsthatthispolicywouldbenefittherichattheexpenseofthepoor.
a.Bothsenators’argumentsareprimarilyaboutequality.
b.Bothsenators’argumentsareprimarilyaboutefficiency.
c.SenatorJackson’sargumentisprimarilyaboutequality,whileSenatorFeldman’sargumentisprimarilyaboutefficiency.
d.SenatorJackson’sargumentisprimarilyaboutefficiency,whileSenatorFeldman’sargumentisprimarilyaboutequality.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomist
KEYWORDS:BLOOM'S:Comprehension
NOTES:r
38.Supposethegovernmenttaxesthewealthyatahigherratethanittaxesthepoorandthendevelopsprogramstoredistributethetaxrevenuefromthewealthytothepoor.Thisredistributionofwealth
a.ismoreefficientandmoreequalforsociety.
b.ismoreefficientbutlessequalforsociety.
c.ismoreequalbutlessefficientforsociety.
d.islessequalandlessefficientforsociety.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Comprehension
39.Thegovernmenthasjustpassedalawrequiringthatallresidentsearnthesameannualincomeregardlessofworkeffort.Thislawislikelyto
a.increaseefficiencyandincreaseequality.
b.increaseefficiencybutdecreaseequality.
c.decreaseefficiencybutincreaseequality.
d.decreaseefficiencyanddecreaseequality.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistEquality
KEYWORDS:BLOOM'S:Comprehension
40.Theopportunitycostofanitemis
a.thenumberofhoursneededtoearnmoneytobuytheitem.
b.whatyougiveuptogetthatitem.
c.usuallylessthanthedollarvalueoftheitem.
d.thedollarvalueoftheitem.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Knowledge
41.Ineconomics,thecostofsomethingis
a.thedollaramountofobtainingit.
b.alwaysmeasuredinunitsoftimegivenuptogetit.
c.whatyougiveuptogetit.
d.oftenimpossibletoquantify,eveninprinciple.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Knowledge
42.What yougive uptoobtain anitem iscalledyour
a.opportunitycost.
b.explicitcost.
c.monetarycost.
d.directcost.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Knowledge
43.Whichofthefollowingiscorrectconcerningopportunitycost?
a.Excepttotheextentthatyoupaymoreforthem,opportunitycostsshouldnotincludethecostofthingsyouwouldhavepurchasedanyway.
b.Tocomputeopportunitycosts,youshouldsubtractbenefitsfromcosts.
c.Opportunitycostsandtheideaoftrade-offsarenotcloselyrelated.
d.Rationalpeopleshouldcomparevariousoptionswithoutconsideringopportunitycosts.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Comprehension
44.High-schoolathleteswhoskipcollegetobecomeprofessionalathletes
a.obviouslydonotunderstandthevalueofacollegeeducation.
b.usuallydosobecausetheycannotgetintocollege.
c.understandthattheopportunitycostofattendingcollegeisveryhigh.
d.arenotmakingarationaldecisionsincethemarginalbenefitsofcollegeoutweighthemarginalcostsofcollegeforhigh-schoolathletes.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Easy
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
45.Supposethatyouhavereceived$300asabirthdaygift.Youcanspendittodayoryoucanputthemoneyinabankaccountforayearandearn5percentinterest.Theopportunitycostofspendingthemoneytoday,intermsofwhatyoucouldhaveafteroneyear,is
a.$0.
b.$15.
c.$305.
d.$315.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
NOTES:r
46.Whencomputingtheopportunitycostofattendingabasketballgameyoushouldinclude
a.thepriceyoupayfortheticketandthevalueofyourtime.
b.thepriceyoupayfortheticket,butnotthevalueofyourtime.
c.thevalueofyourtime,butnotthepriceyoupayfortheticket.
d.neitherthepriceoftheticketnorthevalueofyourtime.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
NOTES:r
47.Melodydecidestospendthreehoursworkingovertimeratherthangoingtotheparkwithherfriends.Sheearns$20perhourforovertimework.Heropportunitycostofworkingis
a.the$60sheearnsworking.
b.the$60minustheenjoymentshewouldhavereceivedfromgoingtothepark.
c.theenjoymentshewouldhavereceivedhadshegonetothepark.
d.nothing,sinceshewouldhavereceivedlessthan$60worthofenjoymentfromgoingtothepark.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Challenging
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
NOTES:r
48.Ramonadecidestospendtwohourstakinganapratherthanattendingherclasses.Heropportunitycostofnappingis
a.thevalueoftheknowledgeshewouldhavereceivedhadsheattendedclass.
b.the$24shecouldhaveearnedifshehadworkedatherjobforthosetwohours.
c.thevalueofhernapminusthevalueofattendingclass.
d.nothing,sinceshevaluedsleepmorethanattendanceatclass.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Challenging
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
NOTES:r
49.HamidspendsanhourstudyinginsteadofwatchingTVwithhisfriends.Theopportunitycosttohimofstudyingis
a.theimprovementinhisgradesfromstudyingforthehour.
b.theimprovementinhisgradesfromstudyingminustheenjoymentofwatchingTV.
c.theenjoymenthewouldhavereceivedifhehadwatchedTVwithhisfriends.
d.zero.SinceHamidchosetostudyratherthantowatchTV,thevalueofstudyingmusthavebeengreatertohimthanthevalueofwatchingTV.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Challenging
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
NOTES:r
50.Formoststudents,thelargestsinglecostofacollegeeducationis
a.thewagesgivenuptoattendschool.
b.tuition,fees,andbooks.
c.roomandboard.
d.transportation,parking,andentertainment.
ANSWER:a
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Comprehension
51.Formoststudents,theearningstheygiveuptoattendcollegeare
a.aminorcostwhencomparedtothecostsoftuition,roomandboard,andthelike.
b.thesinglelargestcostoftheireducation.
c.aboutequaltothecostsofroomandboardatcollege.
d.notconsideredtruecostsbyaneconomist.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Comprehension
NOTES:n
52.Theopportunitycostofgoingtocollegeis
a.thetotalspentonfood,clothing,books,transportation,tuition,lodging,andotherexpenses.
b.thevalueofthebestopportunityastudentgivesuptoattendcollege.
c.zeroforstudentswhoarefortunateenoughtohavealloftheircollegeexpensespaidbysomeoneelse.
d.zero,sinceacollegeeducationwillallowastudenttoearnalargerincomeaftergraduation.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Comprehension
53.Whichofthe followingisnotanexampleoftheopportunitycostofgoingtoschool?
a.Themoneyastudentcouldhaveearnedbyworkingifhehadnotgonetocollege.
b.Thenapastudentcouldhaveenjoyedifhehadnotattendedclass.
c.Thepartyastudentcouldhaveenjoyedifhehadnotstayedintostudyforhisexam.
d.Themoneyastudentspendsonrentforhisapartmentwhileattendingschool.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
54.Foracollegestudentwhowishestocalculatethetruecostsofgoingtocollege,thecostsofroomandboard
a.shouldbecountedinfull,regardlessofthecostsofeatingandsleepingelsewhere.
b.shouldbecountedonlytotheextentthattheyaremoreexpensiveatcollegethanelsewhere.
c.usuallyexceedtheopportunitycostofgoingtocollege.
d.plusthecostoftuition,equalstheopportunitycostofgoingtocollege.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
55.Whenyoucalculateyourtruecostsofgoingtocollege,whatportionofyourroom-and-boardexpensesshouldbeincluded?
a.Yourfullroom-and-boardexpensesshouldalwaysbeincluded.
b.Noneofyourroom-and-boardexpensesshouldeverbeincluded.
c.Youshouldincludeonlytheamountbywhichyourroom-and-boardexpensesexceedtheincomeyouearnwhileattendingcollege.
d.Youshouldincludeonlytheamountbywhichyourroom-and-boardexpensesexceedtheexpensesforrentandfoodifyouwerenotincollege.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
56.ConsiderFrank’sdecisiontogotocollege.Ifhegoestocollege,hewillspend$21,000ontuition,$11,000onroomandboard,and$1,800onbooks.Ifhedoesnotgotocollege,hewillearn$16,000workinginastoreandspend$7,200onroomandboard.Frank’scostofgoingtocollegeis
- $33,800.
- $42,600.
- $49,800.
- $57,000.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Analysis
NOTES:r
57.Supposeaftergraduatingfromcollegeyougetajobworkingatabankearning$30,000peryear.Aftertwoyearsofworkingatthebankearningthesamesalary,youhaveanopportunitytoenrollinaone-yeargraduateprogramthatwouldrequireyoutoquityourjobatthebank.Whichofthefollowingshouldnotbeincludedinacalculationofyouropportunitycost?
a.thecostoftuitionandbookstoattendthegraduateprogram
b.the$30,000salarythatyoucouldhaveearnedifyouretainedyourjobatthebank
c.the$45,000salarythatyouwillbeabletoearnafterhavingcompletedyourgraduateprogram
d.thevalueofinsurancecoverageandotheremployeebenefitsyouwouldhavereceivedifyouretainedyourjobatthebank
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
58.Forwhichofthefollowingindividualswouldtheopportunitycostofgoingtocollegebehighest?
a.apromisingyoungmathematicianwhowillcommandahighsalaryoncesheearnshercollegedegree
b.astudentwithaveragegradeswhohasneverheldajob
c.afamous,highly-paidactorwhowantstotaketimeawayfromshowbusinesstofinishcollegeandearnadegree
d.astudentwhoisthebestplayeronhiscollegebasketballteam,butwholackstheskillsnecessarytoplayprofessionalbasketball
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Application
59.ConsiderMandy’sdecisiontogotocollege.Ifshegoestocollege,shewillspend$20,000ontuition,$10,000onroomandboard,and$2,000onbooks.Ifshedoesnotgotocollege,shewillearn$18,000workinginastoreandspend$8,000onroomandboard.Mandy’scostofgoingtocollegeis
- $32,000.
- $42,000.
- $50,000.
- $58,000.
ANSWER:b
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Analysis
NOTES:r
60.ConsiderNoah’sdecisiontogotocollege.Ifhegoestocollege,hewillspend$80,000ontuition,$15,000onroomandboard,and$4,000onbooks.Ifhedoesnotgotocollege,hewillearn$22,000workinginastoreandhewillspend$13,000onroomandboard.Noah’scostofgoingtocollegeis
- $99,000.
- $103,000.
- $108,000.
- $121,000.
ANSWER:c
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost
KEYWORDS:BLOOM'S:Analysis
NOTES:n
61.ConsiderPaul’sdecisiontogotocollege.Ifhegoestocollege,hewillspend$90,000ontuition,$15,000onroomandboard,and$7,000onbooks.Ifhedoesnotgotocollege,hewillearn$22,000workingataconstructionjobandhewillspend$11,000onroomandboard.Paul’scostofgoingtocollegeis
- $96,000.
- $110,000.
- $114,000.
- $123,000.
ANSWER:d
POINTS:1
DIFFICULTY:Difficulty:Moderate
LEARNINGOBJECTIVES: ECON.MANK.15.2-LO:1-1
NATIONALSTANDARDS: UnitedStates-BUSPROG:Analytic
TOPICS:DISC:ThinkingLikeanEconomistOpportunityCost