WGU D089 Principles of Economics Exam Perfectly Answered
Question : Which type of economy is characterized by a
government that plans and controls all economic activity?Command
Correct answer: Command
Correct! A command economy is a centralized economic system in which all economic decisions are made by the nation's government.
Question : What is an example of a normative economic
statement?Marginal tax rates should be lowered on high-income individuals.
Correct 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.
Question : Which characteristic is associated with natural
resources from a business perspective?They exist without human effort.
Correct answer: They exist without human effort.
Correct! Natural resources are found in nature without any human effort.
Question : How can the available supply of natural resources
be increased?Discovering new ways to extract resources
Correct answer: Discovering new ways to extract resources
Correct! The discovery of different ways to extract natural resources can make them more available.
Question : 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?People respond to incentives.
Correct 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.
Question : What are the characteristics of the production
possibility frontier graph?Trade-offs in choices and downward sloping
Correct 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.
Question : How is scarcity represented on the production
possibility frontier?By there being attainable and unattainable points
Correct 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.
Question : The government imposes new safety regulations
on the production of gas stoves. What will happen in the market for gas stoves?Supply decreases.
Correct answer: Supply decreases.
Correct! New government regulations on producers will make it more expensive to produce gas stoves and will decrease supply.
Question : 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?The supply of steel is elastic.
Correct 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.
Question : An individual wants to sell a car that frequently
requires costly repairs. Although the car performs worse and