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Flashcards in TEST 1 Deck (35):

Karl Marx Said

from each according to his ability to each according to his need


In the 1950s, socialists changed their emphasis in advocating socialism in capitalist countries, why?

Because marx's predictions about the labor markets did not materialize


Darius chose to buy a new car rather than to get a college education. From this we conclude that he valued the new car more than he valued an education. Our conclusion is based on...

The theory of reveal preference


Ramona is willing to accept a minimum of $35 to mow her neighbors yard. This means that Ramona's cost of mowing the neighbor's yard is...



The cost of pizza is

The value that someone must sacrifice in order to obtain a pizza


a new law restricts danger to workers in the workplace. Which is true?

some workers may object because it would lower their salaries


Compared to a situation where the government gives no support for a university education, if the government gives grants of $4000 per year to each student

there would be a social loss because the value of education to the newly enrolled students would be less than the cost of the education to those students


scientists have discovered how to make previously harmless bacteria able to infect humans, causing discomfort, but not death, they have also found a was to quickly cure an infected person. it is true that

people will not better off because people do not actually profit from destruction


The value of something is

the most one is willing to sacrifice to obtain something


In the UK, one does not have to pay in order to visit a doctor, how does this pertain to the no free lunch principle

this is NOT a violation of the no free lunch priciple


The reason oil companies would spend more on exploration as world oil supplies run low is

the price of oil is high


"Good results arise when things are let alone," is a statement

made by an ancient philosopher regarding spontaneous order


Rational ignorance theory says the benefit of voting is trivially small because

the likelihood that one vote will change the election is trivially small


the government affects the ethanol market by

mandating that it be used in gasoline

paying subsidies to ethanol manufacturers

restricting ethanol imports


In 2009 expensive testing for the metal, lead, in toys...

was welcomed by large toy manufacturers


"If CAFE regulations were repealed, no fuel efficient cars would be built." this is an example of

status quo minus fallacy


The direct costs of regulation include

business employees and programs for reporting, planning and administering compliance with regulation

wasteful activities such as hiring lobbyists


Sam Peltzman has pointed out that due to safety improvements on automobiles...

There are more accidents and more pedestrian deaths


Bastiat says that the main argument his opponents make in favor of taxes is that...

they provide income for public officials, who make purchases which give others income


for individuals and for entire economies, having more income and wealth depend on having...

higher quality resources


Bastiat says that if government transported grain, rather than the private market that...

government costs would be higher due to the lack of competition


the Law of Increasing Opportunity Costs comes from...

the principle of optimal arrangement

the fact that resources are not identical


Points inside the production possibilities frontier represent combinations...

such that there are unemployed resources


The japanese government built an island in Osaka bay and put an airport on it. The island is...



according to Bastiat, in the manufacture of a coat....

everyone in the production process is a middleman


Milton Friedman was once told that workers in an underdeveloped country used shovels instead of bulldozers in order to create more jobs. He recommended that they..

use spoons instead.


Adam Smith said...

those who pursue self interest promote the public interest better than those who intended to promote public interests.


Transactions costs are

resources used to find and complete exchanges


When we add the balance of the current account and the balance of the capital account we get

zero. The current account is the negative of the capital account


If foreigners want more US goods, we expect the dollar to...

Appreciate and exporting become harder


People who work in the oil refining industry, which depends on foreign oil imports prefer a

a strong dollar.

Because a stronger dollar will purchase more oil imports


When we restrict imports with a quota, the group who loses the most are....

domestic consumers of the goood


The point of "The Petition of the Candlemakers" is...

to turn our back on trade is to turn our back on the enlightenment of reason


Comparative advantage comes from...

differences in abilites


in Bastiats story about buying French or Belgian iron, the Protectionists Law will.....

Make a french hat maker worse off, and a french publisher worse off