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post ECO201 MIDTERM EXAM

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Question;? Question;12 out of 2 points If an improvement in the quality;of a good is not fully measured, then the consumer price index will overstate;the increase in the cost of living. ? Question;22 out of 2 points Risk aversion means that people;dislike bad things happening to them. ? Question;30 out of 2 points If a tax credit made investments;more attractive, the interest rate ? Question;40 out of 2 points According to the traditional;theory of production, as capital per worker increases ? Question;50 out of 2 points Greg, an economist, says;Prices rise when the government prints too much money." In this;case, Greg is making a positive statement. ? Question;62 out of 2 points A producer has a comparative;advantage in the production of a good if that producer can produce the good;using fewer inputs than other producers. ? Question;70 out of 2 points Buyers of new bonds ? Question;82 out of 2 points Microeconomics is the study of ? Question;90 out of 2 points If a U.S. airplane manufacturer;opened a factory in Brazil, it would be engaged in ? Question;102 out of 2 points When one producer has an absolute;advantage in the production of every good, that producer cannot gain from trade;with other producers. ? Question;110 out of 2 points Which of the following is;included in GDP? ? Question;120 out of 2 points Frictional unemployment results;from ? Question;130 out of 2 points To produce electricity a U.S.;energy company purchases electrical generators from a company in Germany. Which;of the following happens to the components of U.S. GDP? ? Question;140 out of 2 points A plane from St. Louis to Orlando;is about to take off, but it still has a few empty seats. If the average cost;per seat is $500, the airline must charge standby passengers more than $500 to;profit from the sale of the seat. ? Question;152 out of 2 points The consumer price index is computed;using weights based ? Question;160 out of 2 points The cyclical unemployment rate is;the natural rate of unemployment minus the actual unemployment rate. ? Question;172 out of 2 points In a market economy, the;decisions of what and how much to produce are generally made by ? Question;182 out of 2 points On the one hand more rapid;population growth may lower productivity by stretching the supply of natural;resources and reducing the amount of capital available per worker. On the other;hand, a large population may enhance the rate of technological progress because;there are more scientists and engineers. ? Question;192 out of 2 points Mike is a U.S. citizen who works;in a motorcycle factory in Mexico. Wendy is a foreign exchange student from;Germany who works in a fast food restaurant in the U.S. Whose output is included in GDP? ? Question;200 out of 2 points Which of the following are;included in the investment category of GDP? ? Question;212 out of 2 points A company announces that it has;made record profits. According to the efficient markets hypothesis, this;announcement should ? Question;222 out of 2 points Some economists question the;efficient markets hypothesis and believe that irrational psychological factors;also influence asset prices. ? Question;230 out of 2 points The efficient markets hypothesis;implies that. ? Question;240 out of 2 points Which of the following should not;be included in the cost of going to college? ? Question;250 out of 2 points A high price-earnings ratio;indicates either that a stock is undervalued or that people expect the;corporation's earnings to fall. ? Question;262 out of 2 points Most unemployment spells are;short, and most unemployment observed at any given time is long-term. ? Question;272 out of 2 points Financial markets are financial;institutions through which savers can directly provide funds to borrowers. ? Question;282 out of 2 points Which of the following is true;concerning stocks? ? Question;292 out of 2 points Suppose that the CPI includes two;goods, rice and bread which are substitutes. If the year after the base year;the price of bread rises relative to the price of rice then ? Question;300 out of 2 points Which of the following statements;is false? ? Question;310 out of 2 points In one day Adam can produce;either 5 shirts or 10 ties, and in one day Bob can produce either 6 shirts or;15 ties. Of course, Adam or Bob could split their time between producing shirts;and ties and produce some combination of the two goods. Suppose Adam and Bob;each specialize in the production of the good for which he has the comparative;advantage, and they agree to trade at a price of 4 shirts for 9 ties. Which of;the following statements is correct? ? Question;320 out of 2 points When two individuals voluntarily;trade, ? Question;332 out of 2 points An increase in the amount of;money in the economy will increase inflation and, as a result, push;unemployment higher in the short run. ? Question;340 out of 2 points The federal government enacted;regulation in the 1960s requiring people to wear seatbelts in their cars. Which;of the following did not occur as a result of this legislation? ? Question;352 out of 2 points The sale of used cars is not;included in GDP. ? Question;360 out of 2 points Diversification reduces ? Question;370 out of 2 points In one day Cindy can either build;1 computer or 2 stereos, and in one day Dana can build either 2 computers or 3;stereos. Of course, Cindy or Dana could split their time between the two;activities and produce some combination of the two products. Suppose Cindy and;Dana each specialize in the production of the good for which she has the;comparative advantage, and they agree to trade at a price of 7 stereos for 4;computers. Which of the following statements is correct? ? Question;382 out of 2 points Tim has looked for work in the;past, but because he's been unsuccessful finding work he has temporary given up;looking for work and hasn't looked during the last month. The BLS counts Tim as unemployed.;If he were counted as out of the labor force the unemployment rate would remain;the same. ? Question;392 out of 2 points A person who moved money from;bonds to stocks would increase both risk and return. ? Question;400 out of 2 points Economists use assumptions in;order to ? Question;412 out of 2 points Indexation is the automatic;correction by law or contract of a dollar amount for the effects of inflation. ? Question;420 out of 2 points If country A has a higher level;of real GDP per person than country B, we can be certain that people in country;A are better off. ? Question;432 out of 2 points Adverse selection means that ? Question;442 out of 2 points Trade allows countries to;specialize in what they do best and to enjoy a greater variety of goods and;services. ? Question;452 out of 2 points Which of the following is human;capital? ? Question;460 out of 2 points In one day Adam can produce;either 5 shirts or 10 ties, and in one day Bob can produce either 6 shirts or;15 ties. Of course, Adam or Bob could split their time between producing shirts;and ties and produce some combination of the two goods. Which of the;following statements is correct? ? Question;470 out of 2 points Efficiency wages make;unemployment ? Question;480 out of 2 points Differences in natural resources;explain some differences in the standard of living around the world, but;abundant natural resources are not necessary for an economy to be highly;productive. ? Question;492 out of 2 points Points lying on the production;possibilities frontier are efficient outcomes while points lying inside the;production possibilities frontier are inefficient outcomes. ? Question;500 out of 2 points Which of the following is an;example of a normative statement?

 

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