Econ Topic 1

Why are technology companies such as Apple, Inc. based in the San Francisco Bay area rather than in any other part of the country?

• The economy is weaker in other areas of the country
• Other areas are underutilizing their resources
• Its resources are best suited to produce high-tech goods
• The PPC has shifted to the left elsewhere

To conduct a cost-benefit analysis, a sensible person would MOST LIKELY

• compare known costs to unknown benefits
• compare previous costs to previous benefits
• compare marginal costs to marginal benefits
• compare unknown costs to known benefits

A production possibilities curve shows the relationship between the production of

• two types of farm goods.
• two types of factory goods.
• any two categories of goods.
• farm goods and factory goods.

Which of the following causes a production possibilities frontier to shift to the right?

• the economy destabilizes
• the economy stagnates
• the economy shrinks
• the economy grows

Human capital includes

• the equipment used by a doctor to cure a patient.
• an Uber driver's knowledge of the city streets.
• the machinery used to weave cloth.
• a salary paid to an accountant.

Which of the following is a land resource that a restaurant needs to operate?

• the servers who wait on customers
• the water used for drinking and cleaning
• the building where the restaurant is located
• the farmer who grows the vegetables served at the restaurant

When the owner of a theme park is considering whether to build a new roller coaster, s/he is

• underutilizing resources.
• experiencing a shortage.
• using human capital.
• thinking at the margin.

Which of the following is true about scarcity?

• scarcity affects all societies
• scarcity of resources can be eliminated using sound economic policies
• scarce goods lead to lower prices
• scarcity exists only in poor countries

What can cause a production possibilities curve to move to the right?

• thousands of people move out of the country
• an epidemic kills thousands of young men and women
• a new invention lowers the cost of production
• the population is growing increasingly old

Clothing is best described as an example of

• entrepreneurial risk taking.
• a want.
• a need.
• physical capital.