Eight Powerful Ideas MCQ
1. Which of the following statements about economic growth rates is TRUE?
Answer
Correct Answer:
A slight difference in growth rates over a long period of time makes a big difference.
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2. Inflation is defined as ______.
Answer
Correct Answer:
An increase in the overall price level in an economy
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3. In a market economy, a trade-off often exists between the size of the economic pie and how it is divided, or between ______.
Answer
Correct Answer:
Efficiency and equality
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4. What type of market failure occurs when a single seller dominates a market and excludes others from participating in mutually beneficial exchange?
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5. In a market economy, most of the resources are owned by ______.
Answer
Correct Answer:
Private individuals and firms
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6. Production of citrus crops in Florida demonstrates what concept in economics?
Answer
Correct Answer:
Specialization
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7. The voluntary exchange of goods and services is called ______.
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8. Which of the following statements about incentives is most accurate?
Answer
Correct Answer:
Incentives may be either positive or negative.
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9. In economic decision making, the difference between expected marginal benefits and expected marginal costs is known as the ______.
Answer
Correct Answer:
Net benefit
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10. Economists consider the concept of need difficult to define because ______.
Answer
Correct Answer:
It is hard to compare “needs” among people
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11. In economics, the idea that people make the best choice they can, based on their values, information, and circumstances, is called ______.
Answer
Correct Answer:
Rational decision making
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12. In economic decision making, the term opportunity cost refers to ______.
Answer
Correct Answer:
The value of the best alternative that was not chosen
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13. Which of the following items is considered an economic good?
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14. A person who combines the resources of labor, land, and capital to produce goods and services is called a(n) ______.
Answer
Correct Answer:
Entrepreneur
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15. Office buildings, machines, and factories are all considered what type of economic resource?
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16. Items we value or desire that we can reach out and touch are called
Answer
Correct Answer:
Tangible Goods
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17. Specializing is Concentrating on the production of _____ Goods
Answer
Correct Answer:
Both of these
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18. Services are ______ items of value provided to consumers
Answer
Correct Answer:
Intangible
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19. If the expected marginal benefits are greater than the expected marginal costs
Answer
Correct Answer:
Rule of rational choice
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20. Rational decision making is the idea that people do the best they can, based on their values and information.
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21. Output per worker is called
Answer
Correct Answer:
Productivity
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22. Price controls are Government-mandated ________ prices
Answer
Correct Answer:
Minimum or Maximum
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23. An incentive that either reduces costs or increases benefits
Answer
Correct Answer:
Positive incentive
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24. The value of the best forgone alternative that was not chosen is called
Answer
Correct Answer:
Opportunity cost
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25. ________ is the difference between the expected marginal benefits and the expected marginal costs
Answer
Correct Answer:
Net benefit
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26. An incentive that either increases costs or reduces benefits, resulting in a decrease in an activity or behavior is called
Answer
Correct Answer:
Negative incentive
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27. When the economy fails to allocate resources efficiently on its own is called
Answer
Correct Answer:
Market failure
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28. Marginal thinking is Focusing on the ____ choices
Answer
Correct Answer:
Additional or Marginal
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29. ______ is the natural resources used in the production of goods
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30. Labor is the _______ effort used in the production of goods and services
Answer
Correct Answer:
Both of these
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31. Goods that we cannot reach out and touch are called
Answer
Correct Answer:
Intangible goods
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32. Items we value or desire are called Goods
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33. A benefit from consumption that spills over to those who are not consuming the good is called
Answer
Correct Answer:
Externality
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34. Those who combine labor, and capital to produce services are called
Answer
Correct Answer:
Entrepreneurs
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35. Entrepreneurial ability is an ability to develop new products or _____existing products and/or production processes.
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36. When an economy gets the most out of its scarce resources is called______.
Answer
Correct Answer:
Efficiency
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37. The economy’s ability to produce more goods and services is economic _____.
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38. Economic goods are goods that are desirable but ____ in supply.
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39. ______advantage that occurs when a person, a region, or country can produce a good or service at a lower opportunity cost than others.
Answer
Correct Answer:
Comparative
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40. The equipment and structures used to produce goods and services is called _____.
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41. Bads are Items that we do not desire or want such as terrorism, smog, or poison
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Microeconomics MCQs | Topic-wise
