AP MACRO UNIT 1 Review

Front

In a mixed economy, the three basic economic questions are answered by whom?

Back

markets and the government

Front

If one-fourth of a nation’s wheat crop is destroyed by a flood in a given season, then the price of wheat and the quantity sold will change in which of the following ways?

Back

Price- increase, quantity- decrease

Front

Which of the following likely results in a permanent increase (outward shift) in a nation’s productive capacity (rightward shift of the PPF)?
a. a decline in the birth rate
b. decline in adult literacy rates
c. widespread relocation of manufacturing firms to low-wage nations
d. national investment in capital resources like computers
e. a global increase in the price of oil

Back

national investment in capital resources like computers

Front

Nation X can produce 3 units of paper or 9 units of crepes. Nation Y can produce 5 units of paper or 5 units of crepes. Which of the following is true?

Back

Nation X has comparative advantage in crepe production and should trade crepes to Nation Y in exchange for paper.

Front

A change in which of the following can affect the growth (PPF) of a country? I. The quantity and quality of a country’s labor force (workers) II. Technology III. Spending on capital goods/resources

Back

I, II, and III

Front

Economics is most accurately described as the study of how to make choices give our resources.

Back

how to make choices give our resources

Front

The value of the best alternative forgone when a decision is made defines

Back

opportunity cost

Front

If the country is currently producing at Point D, it can produce more CAPITAL goods by doing which of the following? Moving to point A, Moving to point C, Moving to point I, Moving to Point E

Back

Moving to point A

Front

The opportunity cost of moving from Pt E to Pt D is

Back

10 Consumer Goods

Front

If demand for a good or service decreases, the equilibrium price and quantity are most likely to change in which of the following ways? Price- increase, Quantity- increase; Price- increase, Quantity- decrease; Price- decrease, Quantity- decrease; Price- decrease, Quantity- increase; Price- no change, Quantity- no change

Back

Price- decrease, Quantity- decrease