Economics

HOMEWORK FOR INTRODUCTION TO ECONOMICS

I. True or false

1. Our needs and wants are limited

2. “A rise in consumer incomes will lead to a rise in the demand for new cars” is normative statement.

3. “The retirement age should be raised to 75 to combat the effects of our ageing population” is normative statement.

4. Resources are known as factors of production.

5. Macroeconomics is primary concerned with the behavior of the single households and individuals.

6. Scarcity is the economic problem of unlimited resources relative to finite needs and wants.

7. Capital resources in economics refer to the money that the owners of the business contribute to the business.

8. Economics is a study of scarcity.

9. Capital is money invested in shares.

10. An office building represents an example of a land resource

II. Multiple-choice question

1. Which one of the following is a factor of production?

A. Money

b. Government

c. Land

d. Checkable deposits

e. None of the above

2. What is opportunity cost?

a. the value of your choice

b. the dollar value of all your choices combined

c. the dollar and non-dollar value of all your choices

d. the value of your next best alternatives

e. the value of all your alternatives

3. When a country or entity has a comparative advantage, which of the following is true?

a. it has a higher opportunity cost when producing a good or service than any other country or entity

b. the country can produce more of that good than its competitor

c. the country can produce more of a particular good at a lower opportunity cost than any other country or entity

d. the country produces less of a particular good or service than any other country

4. Which of the following factors of production would a machine belong to ?

a. land

b. labor

c. capital

d. money

e. technology

5. If a country’s production possibilities curve shifts outward, which one of the following is true?

a. the country has underemployed its...