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Econ Final Review

53 Questions  I  By Sarah3gibson
ECON Final Review

  
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1.  People make decisions at the margin by
A.
B.
C.
D.
2.  If a technological advance makes it possible to produce bananas at a lower cost,
A.
B.
C.
D.
3.  When opening a restaurant you need to buy ovens, freezers, tables and cash registers. Economists call these expenditures 
A.
B.
C.
D.
4.  Which of the following is generally an opportunity cost of investment in human capital?
A.
B.
C.
D.
5.  Suppose that in October the price of a cafe latte was $1.50 and 400 lattes were consumed. In November the price of a latte was $2.00 and 200 lattes were consumed. What might have caused this change?
A.
B.
C.
D.
6.  Rick loses his job and immediately begins looking for another. Ceteris paribus, the unemployment rate
A.
B.
C.
D.
7.  An organization that tries to encourage the flow of investment to poor countries is the
A.
B.
C.
D.
8.  Inward-oriented policies 
A.
B.
C.
D.
9.  A person who is NOT counted as unemployed by the BLS is
A.
B.
C.
D.
10.  Which of the following is the correct definition of GDP?
A.
B.
C.
D.
11.  If the government's expenditures exceeded its receipts, it would likely
A.
B.
C.
D.
12.  Which of the following is adverse selection?
A.
B.
C.
D.
13.  The two loops of the circular flow diagram represent the flow of 
A.
B.
C.
D.
14.  If the equilibrium price of a good increases and the equilibrium quantity of the good decreases, we can conclude that
A.
B.
C.
D.
15.  Which of the following DOES NOT affect the quantity demanded of a product?
A.
B.
C.
D.
16.  Which of the following contributes to low growth of real GDP per person?
A.
B.
C.
D.
17.  Suppose that demand for pizza is given by Q=40-3p and the supply of pizza is given by Q=P-8. The equilibrium price of pizza is _____ and the equilibrium quantity of pizza is _____.
A.
B.
C.
D.
18.  Which of the following would NOT be considered physical capital?
A.
B.
C.
D.
19.  Unemployment insurance
A.
B.
C.
D.
20.  Without trade
A.
B.
C.
D.
21.  Assume that chicken and beef are substitutes. When the price of beef increases,
A.
B.
C.
D.
22.  In 2002 real GDP in Oceania was 561 billion and the population was 2.2 million. In 2001 real GDP was 500 billion and the population was 2 million. What was the approximate growth rate of real GDP per person?
A.
B.
C.
D.
23.  The CPI is a measure of the overall cost of
A.
B.
C.
D.
24.  A supply curve is defined as the relationship between 
A.
B.
C.
D.
25.  Suppose that consumers expect the price of a product to decrease in the future. The result is that
A.
B.
C.
D.
26.  New products are invented every year. Consequently, real GDP growth
A.
B.
C.
D.
27.  If nominal GDP is $10 trillion and real GDP is $8 trillion, the GDP deflator is
A.
B.
C.
D.
28.  When the price of peanuts falls,
A.
B.
C.
D.
29.  Human capital is
A.
B.
C.
D.
30.  In the circular flow diagram, 
A.
B.
C.
D.
31.  Suppose that steak is a normal good. When income decreases, the equilibrium quantity of steak will _____ and the equilibrium price of steak will _____.
A.
B.
C.
D.
32.  Suppose that in 1996, 12 million cars were purchased at $15,000 each, while in 1997, 10 million cars were purchased at $12,000 each. What might have caused this change?
A.
B.
C.
D.
33.  Hops are used to produce beer. If the price of hops increases
A.
B.
C.
D.
34.  Suppose that a new advertising campaign extolling the virtues of apple juice is unsuccessful, and a major freeze destroys half the country's apple crop. What happens to the price and quantity of apple juice?
A.
B.
C.
D.
35.  The average amount of goods and services produced from each hour of a worker's time is called
A.
B.
C.
D.
36.  A transfer payment is
A.
B.
C.
D.
37.  Real GDP per person 
A.
B.
C.
D.
38.  If the nominal interest rate is 8 percent and the rate of inflation is 3 percent, the real interest rate is
A.
B.
C.
D.
39.  The primary reason that U.S. living standards are higher today than a century ago is that
A.
B.
C.
D.
40.  A perpetuity is distinguished from other bonds in that it
A.
B.
C.
D.
41.  Property rights refer to 
A.
B.
C.
D.
42.  Suppose that people expect that the price of orange juice will rise next month. We could predict that the equilibrium quantity of orange juice will ______ and the equilibrium price of range juice will ______ this month.
A.
B.
C.
D.
43.  Which of the following is an example of "brain drain"?
A.
B.
C.
D.
44.  Peaches and cream are complements. When the price of peaches rises, and the price of raw milk (used to make cream) falls,
A.
B.
C.
D.
45.  Institutions in the economy that help to match one person's saving with another person's investment are collectively called the
A.
B.
C.
D.
46.  Which of the following is the correct way to measure productivity?
A.
B.
C.
D.
47.  Over the last few decades Americans have chosen to cook less at home and eat more at restaurants. This change in behavior, by itself, 
A.
B.
C.
D.
48.  An inferior good is defined as a good for which demand increases when 
A.
B.
C.
D.
49.  Scarcity exists when
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B.
C.
D.
50.  Suppose that tea and coffee are normal goods and that the price of coffee rises. If the income effect outweighs the substitution effect, we would predict that people will consume _____ coffee and _____ tea.
A.
B.
C.
D.
51.  The substitution bias in the consumer price index refers to the
A.
B.
C.
D.
52.  In 2000 in Japan, the unemployment rate was about 4.8 percent, the labor force participation rate was about 62 percent, and the adult population was about 108 million. How many people were employed and how many were unemployed?
A.
B.
C.
D.
53.  Most spells of unemployment are
A.
B.
C.
D.
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