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WorksheetsAP Macroeconomics Unit 1
Total questions: 35
Worksheet time: 22mins
Name
Class
Date
1.
1. The relationship between quantity supplied and price is _____ and the relationship between quantity demanded and price is _____.
a)
direct, inverse
b)
inverse, direct
c)
inverse, inverse
d)
direct, direct
e)
strong, weak
2.
Which of the following will NOT cause the demand for model airplanes games to change?
a)
a change in the price of a close substitute
b)
a change in consumer incomes
c)
a change in the price of model airplanes
d)
a change in consumer tastes
e)
a change in consumer preferences
3.
Oil is this type of scarce resource.
a)
Human Capital
b)
Land/Natural
c)
Labor
d)
Physical Capital
4.
Workers agree to a 10% wage increase. Everything else remaining constant, this will cause the _______ curve to shift _____.
a)
demand; right
b)
demand; left
c)
supply; right
d)
supply; left
5.
There is an increase in supply. This will cause the equilibrium price to ______ & the equilibrium quantity to ______.
a)
decrease; increase
b)
decrease; decrease
c)
increase; increase
d)
increase; decrease
6.
Columbia and Mexico both produce wine and cars under conditions of constant opportunity costs. Columbia will have a comparative advantage in car production if:
a)
it can produce more cars than Mexico.
b)
the opportunity cost of car production is lower in Columbia than in Mexico.
c)
its labor productivity in car production is greater than Mexico's.
d)
it can produce more wine than Mexico.
7.
If the supply and demand curves intersect at a price of $20 then any price above that would result in a(n):
a)
shortage.
b)
equilibrium.
c)
increase in demand.
d)
surplus.
8.
A company that makes baseball caps is underutilizing its resources. What does this mean?
a)
The company is running more efficiently than its competitors.
b)
The company is paying its employees less than it should be.
c)
The company is making caps when it could be making t-shirts instead.
d)
The company is producing fewer caps than it could be.
9.
What can cause a production possibilities frontier to shift away from the origin?
a)
Thousands of people move out of the country.
b)
A new technology used in production.
c)
An epidemic kills thousands .
d)
The population is growing increasingly old.
10.
A country’s production possibilities increase because the available workers become more skilled at their jobs. This is an example of growth caused by
a)
Land
b)
Labor
c)
Capital
d)
Entrepreneurship
11.
Both nations will gain from trade when 1 tire trades for:
a)
1/3 radio.
b)
1/2 radio.
c)
1 1/2 radios
d)
2 radios
12.
A decrease in the price of eggs will result in a(n):
a)
increase in the demand for eggs.
b)
increase in the supply of eggs.
c)
decrease in the supply of eggs.
d)
downward movement along the supply curve of eggs.
13.
A decrease in the price of eggs will result in a(n):
a)
increase in the demand for eggs.
b)
increase in the supply of eggs.
c)
decrease in the supply of eggs.
d)
downward movement along the supply curve of eggs.
14.
Economics is the study of...
a)
how businesses produce goods and services
b)
the efficient use of scarce resources
c)
the equitable distribution of wealth
d)
the printing and circulation of money
15.
"There is no such thing as a free lunch means?"
a)
marginal benefit is greater than marginal cost
b)
businesses can increase market share by offering free lunch
c)
scarce resources have alternative uses or opportunity costs
d)
consumers often ask for free lunch
16.
The production of more goods, the development of new technology, and the development of a higher standard of living are associated with what economic goal
a)
Economic Equity
b)
Economic Efficiency
c)
Full Employment
d)
Economic Growth
17.
When we look at the aggregate of the economy the analysis at the level would be called
a)
microeconomics
b)
positive economics
c)
macroeconomics
d)
normative economics
18.
Which would be studied in microeconomics
a)
the output of the entire economy
b)
total number of workers employed by the entire economy
c)
general price levels in the US
d)
the output and price of wheat in the US
19.
Which of the following is a normative economic statement
a)
the CPI rose 5.6% last month
b)
the unemployment rate of 6.8% is too high
c)
the average loan IR is 8.6%
d)
the economy grew at an average rate of 2.6%
20.
What is true of a PPC curve that is concave to the origin
a)
resources are split equally between the two products
b)
more than two products can be analyized
c)
prices of the two products can be the same
d)
as more of one is produced, more of the other good is produced
21.
The most fundamental economic problem is
a)
Scarcity
b)
Taxation
c)
Unemployment
d)
Freedom
22.
If a country has a comparative advantage over another country it is said that
a)
Country A can produce more than Country B
b)
Country A should not trade with Country B
c)
Country A can produce at a lower opportunity cost than Country B
d)
Country A and Country B have no direct relationship to each other
23.
What is Macroeconomics the study of?
a)
study of total effects on the national economy and the global economy of the choices that individuals, businesses, and gov’ts make
b)
study of the choices individuals/businesses make and the way these choices interact and are influenced by governments
c)
study of marginal benefit and marginal cost
d)
study of scarcity
24.
Which of the following is the best definition of opportunity costs?
a)
the amount of one good that must be given up in order to produce one more unit of another good
b)
the amount of an input that must be used in order to produce one more unit of a good
c)
the price of a good that must be charged in order for a merchant to sell one more unit
d)
none of the above
25.
Which is generally a characteristic of a communist economy?
a)
entrepreneurs sell shares in their companies to the government
b)
the economy has a problem incentivizing its people and creating new innovation
c)
the role of government in the economy is restricted by law
d)
investment is encouraged by the promise of large profits
26.
Scarcity is central to the study of economics because it implies that
a)
markets cannot properly allocate resources.
b)
wants can not be fulfilled and thus all goods must be rationed.
c)
every choice involves an opportunity cost.
d)
wants are unlimited.
27.
Human Capital is best defined as
a)
motivation and equipment
workers have access to
b)
technology and
infrastructure humans build
c)
the knowledge and skill that
make a worker productive
d)
a factory
28.
According to the laws of supply and demand, a decrease in demand will cause prices to:
a)
Increase
b)
Decrease
c)
Stay The Same
d)
Equalize
29.
In the resource market, a)_________ are sellers and b)________ are buyers.
a)
a) Firms, b) Households
b)
a) Consumers, b) Owners
c)
a) Households, b) Firms
d)
a) Owners, b) Consumers
30.
Consumers' willingness to replace a costly item with a less costly item is an example of
a)
the substitution effect
b)
the income effect
c)
demand elasticity
d)
law of diminishing marginal utility
31.
An increase in the price of milk causes a decrease in the demand for cereal. The two products are
a)
substitutes
b)
complements
c)
unrelated
d)
demand elastic
32.
According to this demand curve, if the price of movie videos increases from $14 to $16, the quantity demanded will
a)
fall from 600 to 400
b)
rise from 400 to 600
c)
fall from 400 to 200
d)
rise from 200 to 400
33.
Which of the following choices could cause the movement shown in the graph?
a)
a decrease in income
b)
an increase in the number of consumers
c)
a decrease in the price of a substitute
d)
an increase in the price of a complement
34.
When producers offer fewer products for sale at each and every price,
a)
the supply curve has shifted to the right
b)
the supply curve has shifted to the left
c)
the price per unit decreases
d)
they expect subsidies
35.
In the market clearing price
a)
the demand by buyer is rapidly growing
b)
the supply by sellers meets the demand from buyers
c)
sellers have provided more goods than the demand from buyers
d)
sellers have provided enough goods for buyers'demand, but at prices that are too high
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