2024 – 1 To correct for inflation GDP numbers must be converted using the price level in a given year known

1)To correct for inflation, GDP numbers must be converted using the price level in a given year known as the

Answer

Base year

Real year

Current year

Constant year

Inflation year

2) A production possibilities curve represents all of an economy’s combinations for production that are

Answer

Unattainable

Possible and Efficient

Attainable

Inefficient

Desirable

Question 3

Which of the following is a technique used to determine the optimal level of an economic activity?

Answer

Cost/benefit analysis

Production possibilities curve analysis

GDP analysis

Opportunity cost analysis

Question 4

The bow shape of the production possibilities curve reflects

Answer

The opportunity cost concept

The concept of increasing opportunity costs

The concept of diminishing marginal returns

The marginal social cost/marginal social benefit principle

Question 5

Real per capita GDP is defined as

Answer

Population/real GDP

GDP/population

Real GDP/price index

Real GDP/population

Price index/GDP

Question 6

Marginal social cost refers to the

Answer

Cost incurred due to an action undertaken by society

Total expenditures by society on a good like a public park

Cost borne by society when 1 more unit of a good is produced

Cost to society of sub-standard production

Cost to society when an additional unit of a social good is produced

Question 7

If population in a country falls while GDP stays the same, the country’s

Answer

Real GDP falls

Real GDP rises

Per capita GDP rises

Per capita GDP falls

Welfare falls

Question 8

With private property rights, the decision about how to use resources are made by

Answer

The government

Private firms

Individual resource owners

Resource committees

Question 9

The know-how and the means and methods of production available in an economy are known as

Answer

Technology

Capital

Human capital

Labor

Management

Question 10

The purpose of a base year when constructing a price index is:

Answer

Showing how the output values rise from year to year

Encourage inflation

Providing a means to compare the economy’s output across different time periods

To show why expenditures on government goods and services need to increase

Indicate the progress in keeping prices low

Question 11

Economic reasoning would not be necessary if

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Our wants were limited

Resources were expansive

Scarcity were decreased

We could have everything we wanted

Politicians were better at running the economy

Question 12

The fundamental economic problem involves

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Overpopulation

Inflation and unemployment

Scarce resources and unlimited wants

Cheap foreign labor

Supply and demand

Question 13

Labor resources include

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The equipment workers use to complete their work

Only non-management personnel

Any efforts of a person to produce goods

Only the physical efforts of an economy’s people

Question 14

A country can shift out its production possibilities curve by

Answer

Improving its technology

Shifting its production from one good to another

Experiencing a population drop

Using its farmland more productively

Question 15

The means for satisfying wants are

Answer

Insatiable

Unlimited

Infinite

Scarce

Unavailable