Economics Final

Which of the following is the study of an individual's economic choices in their personal lives?

• Microeconomics

• Macroeconomics

Answer explanation

When you think MICRO, think SMALL. It's one person's small choices that make the difference.

Going to school instead of working is considered to be

• a trade off

• the opportunity cost

Answer explanation

If you are thirsty and decide to buy a soda instead of a bottle of water, the bottle of water is considered to be

• a trade off

• the opportunity cost

Answer explanation

Which is not a benefit of innovation?

• Increased unemployment

• Increased demand of resources

• Job creation

• Improvements to technology

Answer explanation

Benefits are always good things. We know that higher unemployment is not a good thing.

Which points on the following Production Possibility Frontier (PPF) are most efficient? (CHECK ALL THAT APPLY)

• A

• B

• C

• D

• X

Answer explanation

If it falls on the curve of the PPF chart, that means that it is most efficient

Which points on the following Production Possibility Frontier (PPF) are not possible outcomes of production? (CHECK ALL THAT APPLY)

• A

• B

• C

• D

• X

Answer explanation

If it lies outside of curve of the PPF chart, that means that it is not possible

Which points on the following Production Possibility Frontier (PPF) are inefficient means of production? (CHECK ALL THAT APPLY)

• A

• B

• C

• D

• X

Answer explanation

If it lies inside of curve of the PPF chart, that means that it is not an efficient means of production (inefficient)

Which of the following do people in any market look for?

• Tangible items

• A comparative advantage

• Marginal deficits

Answer explanation

People will always do what has the greatest advantage comparatively. For example, if you have the choice of working at a fast food place for $10/hr or working in an office for $13/hr, you're going to choose to work in the office. It's a better job for more pay.

AN exclusive right granted for an invention, which is a product or a process that provides a new way of doing something.

• Copyright

• Trademark

• Copyleft

• Patent

Adam Smith, the father of capitalism, believed that monopolies, trusts, and corruption are examples of:

• Market Failure

• Positive business practices

Answer explanation

Monopolies and trusts hurt competition and corruption does not help a market do well. He considered all of these things examples of failure.