MACRO Final Exam With Complete Solutions 2024

The study of economics arises due to - correct answer-Scarcity Economics is the study of the _______ people make to attain their goals, given their ______ resources. - correct answer-Choices; scarce Which of the following best describes an assumption economists make about human behavior? - correct answer-They assume that rational behavior is useful in explaining choices people make even though people may not behave rationally all the time. Consider the following statements: 1. Consumers rent more kayaks from a vendor that rents kayaks at a lower price than other rival kayak vendors along Waikiki beach. 2. Department stores take steps to increase security since they believe it is more costly to allow shoplifting than to install expensive security monitoring equipment. 3. Farmers produce more cotton when its selling price falls. Which of the above statements demonstrates that economic agents respond to initiatives? - correct answer-A and B In 2018, two members of congress introduced the Stop Bad Employers by Zeroing Out Subsidies Act, legislation they hoped would increase wages of employees who were receiving government assistance. These members of Congress though this legislation would give firms a reason to raise employee wages so fewer employees would receive the government programs such as Medicaid and SNAP would be required to - correct answer-Pay a tax equal to the cost of the assistance An office supply store sells a ream of printer paper at a fixed price of $4.50. Which of the following is a term used by economists to describe the money received from the sale of an additional ream of paper? - correct answer-Marginal revenue If the marginal cost for the U.S. Postal Service to deliver packages for Amazon on Sundays is estimated to be $250,000 per Sunday, then the U.S. Postal Service should make these Sunday deliveries - correct answer-As long as the marginal benefit recieved each Sunday is just equal to or greater than $250,000 Lionel's Lawn Care is a company that maintains residential yards. Lionel's cost for his standard package of mowing, edging, and trimming is $15, and he charges $25 for this service. For a total price of $40, Lionel will also trim shrubs, a service that adds an additional $10 to the total cost of the standard package. What is Lionel's marginal benefit if he sells the standard package? - correct answer-25 Trade-offs force society to make choices when answering what three fundamental questions? - correct answer-What goods and services to produce; how will these goods and services be produced; and who receives them? Which of the following is an example of an economic trade-off that a firm has to make? - correct answer-Whether it is cheaper to produce with more machines or with more workers Ted quits his $60,000-a-year job to be a stay-at-home dad. What is the opportunity cost of his decision? - correct answer-At least $60,000 Fast food restaurants produce a range of menu items such as hamburgers, chicken sandwiches, salads, and french fries. What fundamental economic question are they addressing by offering this range of items? - correct answer-What to produce? In a market economy, who decides what goods and services will be produced? - correct answer-Consumers and Producers How are the fundamental economic decisions determined in Cuba? - correct answer-The government decides because Cuba is a centrally planned economy Which of the following is a microeconomic question? - correct answer-How does Fiat decide on the price of the 500 Pop model? Which of the following is a macroeconomic question? - correct answer-What determines the minimum wage? _______ shows that if all resources are fully and efficiently utilized, more of one good can be produced only by producing less of another good. - correct answer-The production possibilities frontier model Figure 2-2 above shows the production possibilities frontier for Visalia, a nation that produces two goods, roses and orchids. Refer to Figure 2-2. What is the opportunity cost of one dozen orchids? - correct answer-2.5 dozen roses Figure 2-2 above shows the production possibilities frontier for Visalia, a nation that produces two goods, roses and orchids. Refer to Figure 2-2. What is the opportunity cost of one dozen roses? - correct answer-0.4 dozen orchids Which of the following would shift a nation's production possibilities frontier inward? - correct answer-A law requiring workers to retire at age 50