Econ

Front 1

The largest functional share of the national income consists of:

Back 1

wages and salaries.

Front 2

In the above diagrams for a hypothetical economy, Figure 1 shows the: (1)

Back 2

distribution of income.

Front 3

In the above diagrams for a hypothetical economy, Figure 2 shows the: (1)

Back 3

personal distribution of income.

Front 4

The distribution of income among individual households is known as:

Back 4

the personal distribution of income.

Front 5

Listed in descending order of relative size, households divide their total incomes among:

Back 5

consumption expenditures, taxes, and saving.

Front 6

descending order of relative size, total consumption spending is comprised of:

Back 6

services, nondurable goods, and durable goods.

Front 7

define durable goods as those products expected to last at least _____ year(s).

Back 7

3

Front 8

Which form of business enterprise accounts for the largest number of firms in the United States?

Back 8

proprietorships

Front 9

The advantages of the corporate form of business include:

Back 9

the ability to raise financial capital by selling stocks and bonds.

Front 10

Suppose you own $50,000 of personal property, $5,000 of stock in General Statics Corporation, a $10,000 savings account, and $20,000 of government bonds. If General Statics goes bankrupt, the most you could lose is:

Back 10

$5,000.

Front 11

The owners of a firm face unlimited liability for the firm's debts in:

Back 11

both a proprietorship and a partnership.

Front 12

As it relates to corporations, the principal-agent problem is that:

Back 12

the goals of the corporate managers (the agents) may not match the goals of the corporate owners (the principals).

Front 13

Most output in the United States is produced by:

Back 13

corporations.

Front 14

Corporations comprise about _____ percent of all businesses, but produce nearly _____ percent of domestic output.

Back 14

20; 85

Front 15

Negative externalities arise:

Back 15

when firms "use" resources without being compelled to pay for their full costs.

Front 16

A pure market economy over allocates resources to the production of goods that:

Back 16

involve negative externalities.

Front 17

If a market is competitive but externalities are present, the resulting equilibrium output:

Back 17

may be either larger or smaller than the most efficient output.

Front 18

. Externalities:

Back 18

relate to both costs and benefits.

Front 19

If the production of a good or service creates sizable positive externalities, government might correct for the:

Back 19

over allocation of resources to its production by granting a subsidy.

Front 20

For which of the following goods or services would a government subsidy be most likely to improve the allocation of resources?

Back 20

cancer research

Front 21

Susie lives in a dorm and likes to play loud music in her room. Her neighbor Kara enjoys the same type of music and gets pleasure from Susie turning up the music. Her other neighbor, Alex, can't stand Susie's music and gets mad when she turns it up for all to hear. When Susie plays her music loudly, she creates:

Back 21

a positive externality for Kara, and a negative externality for Alex.

Front 22

Rivalry and excludability are the main characteristics of:

Back 22

private goods.

Front 23

Non excludability is the idea that:

Back 23

individuals who are unable or unwilling to pay for a good cannot be excluded from the benefits provided by that product.