WGU Principles of Economics - D089 TESTS Questions And Answers!!Which type of economy is characterized by a government that plans and controls all economic activity? - Answer Command Correct! A command economy is a centralized economic system in which all economic decisions are made by the nation's government.What is an example of a normative economic statement? - Answer Marginal tax rates should be lowered on high-income individuals.Correct! A marginal tax rate is the amount of money an individual pays in taxes on each additional dollar earned. This statement uses the word "should", which makes it a value judgment or opinion and a normative statement.Which characteristic is associated with natural resources from a business perspective? - Answer They exist without human effort.Correct! Natural resources are found in nature without any human effort.How can the available supply of natural resources be increased? - Answer Discovering new ways to extract resources Correct! The discovery of different ways to extract natural resources can make them more available.A ski resort sells tickets online at $70 per ticket. The resort is not selling many tickets, so it offers a two-for-one opportunity. Which economic principle is being used? - Answer People respond to incentives.Correct! The incentive of a sale or coupon changed the cost from $70 to $35, making the ski trip more affordable and desirable. This incentive is what likely changed buyers' behaviors.What are the characteristics of the production possibility frontier graph? - Answer Trade-offs in choices and downward sloping Correct! The graph of the production possibility frontier reflects trade-offs in choices and is downward sloping.How is scarcity represented on the production possibility frontier? - Answer By there being attainable and unattainable points Correct! The production possibility frontier depicts the impact of scarcity by providing a clear mark between the set of attainable and unattainable points.The government imposes new safety regulations on the production of gas stoves.What will happen in the market for gas stoves? - Answer Supply decreases.Correct! New government regulations on producers will make it more expensive to produce gas stoves and will decrease supply.The price of steel has increased by 5%, which leads to an increase in quantity supplied by 8%. Which outcome can be concluded from the demand and supply of steel? - Answer The supply of steel is elastic.Correct! Because the quantity supplied increased by more than 5%, it is reasonable to conclude that the supply of steel is elastic.
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