IS and Econ 13 c. was the greatest economist of the
Winter 2012 twentieth century.
First Midterm Examination sample d. a and c.
questions e. None of the above - he is just another
(Answers are starred “*”) economic pundit on TV.
2. Most people in low-income countries have 7. The 2 ND Industrial Revolution took place
purchasing power that is primarily in
a. about the same as the income per capita a. Great Britain.
of Mexico. b. the United States.*
b. lower than the income per capita of c. France.
Mexico.* d. Japan.
c. five times less than U.S. per capita e. Sweden.
income. 8. Since the late nineteenth century the
d. less than one hundredth of U.S. per economies of rich countries have been
capita income. characterized by the following EXCEPT
e. about twice the income per capita of a. an increasing division of labor.
Mexico. b. larger firms.
c. an increasing bureaucratization of firms.
3. “PPP” as used in this course refers to d. a diminished role of government.*
a. Purchasing Power Parity* e. the growth of joint-stock companies.
b. Public Policy Polling
c. Point-to-Point Protocol Sweden and Finland produce only two goods,
d. Point-to-Point Protection herring and cell phones. This table shows the
e. Public Purchasing Policy maximum amount that each nation can produce
of the two goods
4. According to the 2009 data on Gross National .
Income (“GNI”) per capita we examined Sweden Finland
a. China has a higher GNI per capita Herrings 100,000 50,000
Cell phones 10,000 10,000
b. China has a higher GNI per capita than
France. Assume the production possibilities frontier is
c. China has a higher GNI per capita than linear and Sweden and Finland are the only two
Japan. countries that can trade. Use this information in
d. Mexico has a higher GNI per capita the questions bellow.
e. a and b.
11. The opportunity cost of one herring in
5. Hunters and gatherers had a. 10,000 herrings
a. a lower protein intake and lower life b. 10,000 cell phones.
expectancies than agriculturalists. c. 1/10 of a cell phone.*
b. a higher protein intake and higher life d. 10 cell phones
expectancies than agriculturalists.*
c. a higher protein intake and lower life e. 5 herrings
expectancies than agriculturalists. 12. The opportunity cost of one herring in
d. a lower protein intake and higher life Finland is
expectancies than agriculturalists. a. 10,000 cell phones.
e. generally lower material well-being than b. 5 cell phones.
agriculturalists. c. 1/10 of a cell phone
6. Adam Smith d. 1/5 of a cell phone.*
e. 10 cell phones.
a. was the author of the "Wealth of
Nations."* 13. The opportunity cost of one cell phone in
b. was an ardent supporter of the corporate Finland is
form of firm organization. a. 5 herrings.*
b. 10 herrings. c. 50,000 herrings b. 5,000
d. 1/5 of a herring. c. 25,000
e. 1/10 of a cell phone. d. 50,000*
14. The following statement is true:
a. Sweden has an absolute advantage 18. The maximum amount of herrings that
(“AA”) in the production of cell phones. Finland can produce for consumption or trade is
b. Finland has an AA in cell phone a. 0
production. b. 5,000
c. Sweden has an AA in herring c. 25,000*
production. d. 50,000
d. b and c. e. 100,000
e. Absolute advantage cannot be
determined from the information 20. 200 years ago average life expectancy at
provided.* birth was
a. higher than 40 years in all European
15. The following statement is true: countries.
a. Sweden has comparative advantage b. lower than 40 years in all European
(“CA”) in herring production.* countries.
b. Sweden has CA in cell phone. c. higher than 50 years in all countries.
c. Finland has CA in both herring and cell d. lower than 50 years in all countries.*
phone production and therefore does not e. a and c.
need to import anything.
d. Finland has CA in herring production. 21. Changes in the following variable shift the
e. Comparative advantage cannot be demand curve for a good.
determined from the information a. Marketing and advertising.
provided. b. The preferences of the consumers.
c. The prices of related goods.
16. The following statement is true: d. The income of consumers.
a. Finland has comparative advantage e. All of the above.*
(“CA”) in herring production.
b. Sweden has CA in cell phone 22. Ch