Macro Econ Part 1 Review

The Production Possibilities model illustrates all of the following on a graph EXCEPT

• money growth
• scarcity
• opportunity cost
• tradeoffs

A point inside a production possibility frontier (point d)

• could indicate that some resources are unemployed or underutilized.
• is unattainable.
• is better than points on the production possibility frontier.
• implies that too much capital and not enough labor are being used.

Which of the following would most likely have caused the production possibilities frontier to shift outward?

• less workers in the economy
• a recession
• a technological advance
• a supply shock such as a tsunami

A currently unattainable point is at the

• 140/80 point.
• 30/30 point.
• 40/50 point.
• 60/80 point.

Who was "the father of modern economics"

• Karl Marx
• Thomas Malthus
• Adam Smith

What were the 2 ideas of Adam Smith's book "The Wealth of Nations"?

• Everyone should share everything
• Free Trade
• Government needs to play a role in economics
• Individuals self serving help the society as a whole

Keynesian economics is which of the following?

• The government must be involved for the economy to survive
• Everyone will have a job if they want one
• Supply and demand determines what's produced

Which came first?

• Capitalism
• Socialism

Laissez-faire means what?

• The government needs to have some control
• The government should control only the production
• The government should control only the consumption
• The government should not be involved in the economy

Another name for a market economy

• Capitalist
• Socialist
• Communist