Economics Final Exam 2024

Firms constantly work to become more efficient, reducing their inputs and maximizing their outputs. What is the economic concept at work?

• Increasing cost
• Increasing productivity
• increasing profit
• changing their revenue

Good intended for use by individuals/families are considered to be...

• Capital goods
• Consumer Goods

Good intended for use by businesses are considered to be...

• Capital goods
• Consumer Goods

Look at the production possibilities graph below. Assume our economy is producing at the bold curve #1. Which points are producing at 100% efficiency?

• A, B, C
• X, Z, B
• Z, A, B, C
• A and B

Look at the production possibilities graph below. Assume our economy is producing at the bold curve #1. Which point is recessionary?

• A
• B
• C
• K
• Z

Choose the correct description of this production possibility graph below.

• This is an increasing cost curve because the goods being produced are made from different resources
• This is a constant cost curve because for every additional item produced, an increasing amount of the other item must be sacrificed
• This is an increasing curve because for every additional item produced, an increasing amount of the other item must be sacrificed
• This is a constant cost curve because the goods being produced are made from similar resources

Choose the correct description of this production possibility graph below.

• This is an increasing cost curve because the goods being produced are made from similar resources
• This is a constant cost curve because for every additional item produced, a constant amount of the other item must be sacrificed
• This is an increasing curve because for every additional item produced, an increasing amount of the other item must be sacrificed
• This is a constant cost curve because the goods being produced are made from similar resources

Use the following Circular Flow model to answer the question. What is the role of an individual in the economy?

• Individuals supply their labor in the factor market, and purchase consumer goods in the product market.
• Individuals supply their labor in the product market and purchase capital goods from the resource market.
• Individuals gain business income from the product market and pay for resources in the factor market.
• Individuals recieve tax breaks from the government and purchase the factors of production from businesses.

The US practices a "mixed economic system." Which of the following most accurately describes a mixed economy?

• A mixed economy uses socialist efficiency and tries to implement free market inequalities.
• A mixed economy is an economy that is best practiced in North Korea.
• A government utilizing a mixed economy attempts to provide all of its people with equal resources so each citizen will create equal outcomes.
• A mixed economy utilizes market freedoms for wealth creation and government regulations and institutions.

If the price of tortilla chips decreased by 50%, what would happen to the demand for salsa and why?

• Demand for salsa as a complement would increase because more people would want chips
• Demand for salsa would decrease because more people would want chips
• Demand for salsa would decrease because salsa is a compliment to chips
• Demand for salsa would see no change
• Demand for salsa would decrease because salsa would get cheaper