AP Mac Modules 1-4 A Question Preview (ID: 35243)
AP Mac Mod 1-4.
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If wages grew at a 3% rate this year and average prices grew ______, people would be _____ off this year compared with last year.
a) 3%; better
b) faster than 3%; better
c) slower than 3%; better
d) faster than 10%; better
An expansion is a period in which:
a) the price level falls.
b) employment falls.
c) unemployment rises.
d) output rises.
If the production possibility curve were a straight line sloping down from left to right, this would suggest that:
a) more of both goods could be produced moving along the curve.
b) the two products must have the same price.
c) the opportunity costs of the products are constant.
d) there are no opportunity costs.
Which of the following is most likely a macroeconomic question rather than a microeconomic question?
a) “Are consumers buying more bottled water and less fruit juice?”
b) “Are salaries for nurses rising or falling?”
c) “Should a tax be levied on each ton of carbon a factory emits?”
d) “Is the national unemployment rate rising or falling?”
An increase in efficiency means that an economy has:
a) increased its opportunity costs.
b) increased the equity of its distribution of goods and services.
c) made some people better off without making others worse off.
d) increased the incentives for its citizens to follow their own self-interest.
The basic concern of economics is:
a) to keep business firms from losing money.
b) to prove that capitalism is better than socialism.
c) to study the choices people make.
d) to use unlimited resources to produce goods and services to satisfy limited wants.
Which of the following is an example of normative economics?
a) The minimum wage has not kept pace with inflation.
b) The minimum wage is an important tool in fighting poverty and should be increased.
c) The minimum wage creates higher unemployment for teens and unskilled workers.
d) A higher minimum wage is expected to increase the price of a fast-food cheeseburger.
When an economy experiences a contraction in its business cycle, this is often:
a) considered the long run.
b) considered to be a recession.
c) accompanied by an increase in employment.
d) viewed as a rarity in the business cycle.
Recessions are periods when:
a) output rises.
b) the aggregate price level rises.
c) the unemployment rate is falling.
d) output and employment are falling.
A period of falling real gross domestic product is an indicator of a(n):
a) peak.
b) trough.
c) expansion.
d) recession.
The problem of determining what goods and services society should produce:
a) exists because we can produce more than we need or want.
b) exists because there are not enough resources to provide all the goods and services that people want to purchase.
c) would not exist if all goods and services were scarce.
d) would not exist if government owned all of the resources.
We are forced to make choices because of:
a) exploitation.
b) efficiency.
c) scarcity.
d) the margin.
An economy is said to have a comparative advantage if it:
a) can produce more of all goods than another economy.
b) can produce less of all goods than another economy.
c) has the highest opportunity cost for producing a particular good.
d) has the lowest opportunity cost for producing a particular good.
An economy that has the lowest opportunity cost for producing a particular good is said to have a(n):
a) technological advantage.
b) comparative advantage.
c) production possibility curve.
d) increasing opportunity cost.
Specialization and trade should lead to all of the following except:
a) individuals learning specific skills and earning a salary.
b) a decrease in total economic output.
c) higher living standards.
d) the exchange of goods and services in markets.
Imports are good and services that are:
a) sold outside of the country.
b) sold inside a country.
c) purchased from another country.
d) purchased inside the country.
The process through which an economy's production possibility curve is shifted outward is:
a) comparative advantage.
b) economic growth.
c) full employment.
d) specialization.
An economy that has the lowest opportunity cost for producing a particular good is said to have a(n):
a) absolute advantage.
b) comparative advantage.
c) production possibility curve.
d) increasing opportunity cost.
An example of a positive statement is:
a) the rate of unemployment is 4%.
b) a high rate of economic growth is good for the country.
c) everyone in the country needs to be covered by national health insurance.
d) baseball players should not be paid higher salaries than the president of the United States.
When we are forced to make choices we are facing the concept of:
a) ceteris paribus.
b) free goods.
c) scarcity.
d) the margin.
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