study for econ Ecn 101 exam 1 (part two)
For women aged 60 to 69, breast cancer screening significantly reduces breast cancer mortality.
Positive
Doctors should encourage women aged 60 to 69 to be screened for breast cancer.
Normative
The government should force doctors to encourage women aged 60 to 69 to be screened for breast cancer.
Normative
Economic models are most often composed of diagrams and equations.
True
Which of the following statements about models is correct?
Models assume away irrelevant details.
Which of the following statements about models is correct?
Models assume away irrelevant details.
The use of theory and observation is more difficult in economics than in sciences such as physics due to the difficulty in
performing an experiment in an economic system.
Instead of conducting laboratory experiments to generate data to test their theories, economists often
gather data from historical episodes of economic change.
Instead of conducting laboratory experiments to generate data to test their theories, economists often
gather data from historical episodes of economic change.
The production possibilities frontier is a graph that shows the various combinations of outputs that the economy can possibly produce given the available factors of production and the available production technology.
True
The production possibilities frontier provides an illustration of the principle that
people face trade-offs.
If an economy can produce more of one good without giving up any of another good, then the economy's current production point is inefficient.
True
Which of the following will cause an economy's production possibilities frontier (PPF) to take a bowed shape?
Not all resources are equally-suited to the production of both goods
Specialization and trade can make everyone better off if a person can obtain goods at prices that are less than that person's opportunity cost.
True
Trade allows a country to consume outside its production possibilities frontier.
True
Trade allows a country to consume outside its production possibilities frontier.
True
If one producer has the absolute advantage in the production of all goods, then that same producer will have the comparative advantage in the production of all goods as well.
False
If one producer has the absolute advantage in the production of all goods, then that same producer will have the comparative advantage in the production of all goods as well.
False
her opportunity cost of mowing her lawn is higher than the cost of paying someone to mow it for her.
A popular celebrity that is paid highly for her time should probably not mow her own lawn because
Suppose that Greece and Switzerland both produce oil and olives. Greece's opportunity cost of producing a crate of olives is 5 barrels of oil while Switzerland's opportunity cost of producing a crate of olives is 10 barrels of oil.
By comparing the opportunity cost of producing olives in the two countries, you can tell that __________ has a comparative advantage in the production of olives and __________ has a comparative advantage in the production of oil.
Greece; Switzerland
Suppose that Greece and Switzerland consider trading olives and oil with each other. Greece can gain from specialization and trade as long as it receives more than _________ barrels of oil for each crate of olives it exports to Switzerland. Similarly, Switzerland can gain from trade as long as it receives more than ________ crate of olives for each barrel of oil it exports to Greece.
5; 1/10
Based on your answer to the last question, which of the following prices of trade (that is, price of olives in terms of oil) would allow both Switzerland and Greece to gain from trade?
9 barrels of oil per crate of olives
The forces that make market economies work are
supply and demand
A competitive market is one in which there are
so many buyers and so many sellers, and each individual is referred to as a "price taker" because they have negligible impact on the price of the good
The claim that, with other things being equal, the quantity demanded of a good falls when the price of that good rises
Law of Demand
A graphical object showing the relationship between the price of a good and the amount of the good that buyers are willing and able to purchase at various prices
Demand Curve
The amount of a good that buyers are willing and able to purchase at a given price
Quantity Demanded
A table showing the relationship between the price of a good and the amount that buyers are willing and able to purchase at various prices
Demand Schedule
Which of the following events would cause a movement upward and to the left along the demand curve for olives?
The price of olives rises.