13. One of the biggest disadvantages of pure market economies is that they do NOT strongly promote
answer: economic security
14.During the Vietnam War, the US government instituted a military draft. Each day a slip was drawn and every draft-eligible male whose birthday was written on it was assigned the same draft number, starting with number one. Each draft number was called successively, and the men whose numbers were called were required to serve in the military. If they refused, the men could be arrested and charged with a crime. What two methods of allocation did the draft depend on the most?
answer: force and lottery
15. Which two methods are MOST common in a market economy?
answer: price and first come first serve
16. In a mixed market economy, the government provides public goods and services that the private sector cannot be relied upon to supply. These may include all of the following EXCEPT
answer: union organization.
17. Which is an example of an externality that is a market failure?
Answer: a factory produces so much noise that residents in a nearby neighborhood cannot even sleep
18. How is productivity determined?
Answer: by measuring the relationship of inputs to outputs
19. If an automaker invests in new assembly line equipment, that investment will MOST LIKELY
answer: increase the automaker's productivity
20. Which of the following is one way that an individual might invest in his or her own human capital?
answer: taking a lifeguard class at the public pool
21. James and Steve are brothers and are about the graduate high school. They both want to work in the automotive industry. James wants to start work right after graduation, while Steve plans to attend college before entering the workforce. How will Steve's investment likely affect his finances?
answer: It will increase his human capital, so Steve will likely earn more than James over his lifetime.
22. Which scenario BEST illustrates the connection between human capital and productivity?
answer: Kyoko, Patrick, and Max are all given the ingredients to make a chocolate cake, but only Kyoko receives a recipe. She finishes her cake before the others, and it is of much better quality.
23.Use the graph of a production possibilities curve to answer the question. Currently, a company produces metal and wooden baseball bats at point C on the production possibilities curve. Recently, the cost of aluminum went down and the company invested in new machinery that would allow it to produce more metal bats than before without reducing production of wooden bats. Which point represents the company's new production output?
answer: Point E
24.Look at the production possibilities frontier for cars and computers. Then answer the question that follows In which situation is the opportunity cost of producing additional computers the lowest?
answer: Computer production is increased from point B to point C.
25. Read the excerpt from Adam Smith's The Wealth of Nations. The woolen coat, for example, which covers the day-laborer… is the produce of the joint labor of a great multitude of workmen. The shepherd, the sorter of the wool, the wool-comber or carder, the dyer, the scribbler, the spinner, the weaver, the fuller, the dresser, with many others, must all join their different arts in order to complete even this homely production. In the excerpt, Smith is referring to the effects of which of the following economic principles? Select the ONE best term that applies.
answer: division of labor
*Could someone look over this and tell me if I chose correct answers!
