Tut 1: macro

The English word that comes from a Greek word which means “ one who manages a household” is

• market

• producer

• consumer

• economy

In considering how to allocate its scarce resources among its various members, a household considers

• each member’s abilities

• each member’s efforts.

• each member’s desires

• all of the above

Economics deals primarily with the concept of

• scarcity

• money

• poverty

• banking

Which of the following is correct?

• The word economy comes from the Greek word for “rational thinker.”

• Economists study the management of scarce resources.

• Because economists believe that people pursue their best interests, they are not interested in how people interact.

• All of the above are correct.

The overriding reason why households and societies face many decisions is that

• 1. resources are scarce.

• goods and services are not scarce.

• 1. incomes fluctuate with business cycles. 

• people, by nature, tend to disagree.

The phenomenon of scarcity stems from the fact that

• most economies’ production methods are not very good.

• in most economies, wealthy people consume disproportionate quantities of goods and services.

• governments restrict production of too many goods and services.

• resources are limited.

Economics is the study of

• production methods.

• how society manages its scarce resources.

• how households decide who performs which tasks.

• the interaction of business and government.

 In most societies, resources are allocated by

• a single central planner.

• a small number of central planners.

• those firms that use resources to provide goods and services.

• the combined actions of millions of households and firms.

 Oil is considered to be a non-renewable energy source.  Oil

• is an unlimited resource.

• is a scarce resource.

• is not a productive resource.

• has no opportunity cost.

Which of the following is not an example of scarcity?

• Only some people can afford to buy a Ferrari.

• Every individual in society cannot attain the highest standard of living to which he or she might aspire.

• Doug has an unlimited supply of apples in his orchard.

• Each member of a household cannot get everything he or she wants