Essay about Econ Ch.1

728 Words Jan 14th, 2015 3 Pages
Chapter 01 Limits, Alternatives, and Choice

Multiple Choice

[QUESTION]
1. Economics is a social science that studies how individuals, institutions, and society may:
A) Expand the amount of productive resources available to them
B) Attain a minimum level of unemployment
C) Best use scarce resources to achieve the maximum satisfaction of economic wants
D) Reduce the prices of goods and services to consumers
Answer: C
Topic: The Economic Perspective
Difficulty: 2 Medium
Learning Objective: 01-01
Bloom’s: Level 1 Remember
AACSB: Analytic

[QUESTION]
2. The key economic concept that serves as the basis for the study of economics is:
A) Inflation
B) Unemployment
C) Money
D) Scarcity
Answer: D
Topic: The Economic
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The idea in economics that "there is no free lunch" means that:
A) Businesses would go bankrupt if they offered free lunches
B) The thought of a free lunch is often better than the reality of consuming it
C) There are opportunity costs involved when scarce resources are used up for free lunches
D) Businesses use free lunches to attract customers but this advertising practice is inefficient
Answer: C
Topic: The Economic Perspective
Difficulty: 2 Medium
Learning Objective: 01-01
Bloom’s: Level 2 Understand
AACSB: Analytic

[QUESTION]
7. Opportunity cost is best defined as:
A) Marginal cost minus marginal benefit
B) The time spent on an economic activity
C) The value of the best forgone alternative
D) The money cost of an economic decision
Answer: C
Topic: The Economic Perspective
Difficulty: 1 Easy
Learning Objective: 01-01
Bloom’s: Level 1 Remember
AACSB: Analytic

[QUESTION]
8. Tammie makes $150 a day as a bank clerk. She takes off two days off work without pay to fly to another city to attend the concert of her favorite music group. The cost of transportation for the trip is $250. The cost of the concert ticket is $50. The opportunity cost of Tammie's attending the concert is:
A)…

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