Question 1

A trend is

Accepted Answer

A)  a measure of closeness on a scatter diagram. 
B)  the minimum value of a variable. 
C)  the difference between the maximum value of a variable and the minimum value of the variable. 
D)  the maximum value of a variable. 
E)  a general tendency for a variable to rise or fall. 
A)  a measure of closeness on a scatter diagram. 
B)  the minimum value of a variable. 
C)  the difference between the maximum value of a variable and the minimum value of the variable. 
D)  the maximum value of a variable. 
E)  a general tendency for a variable to rise or fall.

Question 2

The opportunity cost of a decision is measured in terms of

Accepted Answer

A)  sunk cost. 
B)  the next best thing given up. 
C)  the price of the alternative we choose. 
D)  time. 
E)  the price of a new opportunity that arises. 
A)  sunk cost. 
B)  the next best thing given up. 
C)  the price of the alternative we choose. 
D)  time. 
E)  the price of a new opportunity that arises.

Question 3

What is NOT true about rational choice?

Accepted Answer

A)  It is the same for all individuals. 
B)  It can result in different decisions for different individuals. 
C)  It is a choice that uses the available resources to best achieve the objective of the person making the choice. 
D)  It might turn out not to have been the best choice after the event. 
E)  It involves comparing costs and benefits 
A)  It is the same for all individuals. 
B)  It can result in different decisions for different individuals. 
C)  It is a choice that uses the available resources to best achieve the objective of the person making the choice. 
D)  It might turn out not to have been the best choice after the event. 
E)  It involves comparing costs and benefits

Question 4

If x increases whenever y decreases, then x and y are

Accepted Answer

A)  related but whether positively or negatively related depends on whether the x variable or the y variable is plotted on the vertical axis. 
B)  not related. 
C)  negatively related. 
D)  positively related. 
E)  directly related. 
A)  related but whether positively or negatively related depends on whether the x variable or the y variable is plotted on the vertical axis. 
B)  not related. 
C)  negatively related. 
D)  positively related. 
E)  directly related.

Question 5

Which of the following statements best describes the study of economics?

Accepted Answer

A)  Economics studies how firms make profits. 
B)  Economics studies how to organise production so that scarcity does not occur. 
C)  Economics studies how businesses reach decisions. 
D)  Economics studies how we make choices in the face of scarcity. 
E)  Economics studies how to create incentives so that scarcity does not exist. 
A)  Economics studies how firms make profits. 
B)  Economics studies how to organise production so that scarcity does not occur. 
C)  Economics studies how businesses reach decisions. 
D)  Economics studies how we make choices in the face of scarcity. 
E)  Economics studies how to create incentives so that scarcity does not exist.

Question 6

A linear relationship

Accepted Answer

A)  when graphed is a straight line. 
B)  when graphed is a line whose slope changes. 
C)  can be a positive or a negative relationship. 
D)  Both answers A and C are correct. 
E)  Both answers A and B are correct. 
A)  when graphed is a straight line. 
B)  when graphed is a line whose slope changes. 
C)  can be a positive or a negative relationship. 
D)  Both answers A and C are correct. 
E)  Both answers A and B are correct.

Question 7

If the change in y = 10 and the change in x = 3, there is

Accepted Answer

A)  a positive relationship between y and x. 
B)  no relationship between y and x. 
C)  an independent relationship between y and x. 
D)  a +0.33 relationship between the two variables. 
E)  a negative relationship between y and x. 
A)  a positive relationship between y and x. 
B)  no relationship between y and x. 
C)  an independent relationship between y and x. 
D)  a +0.33 relationship between the two variables. 
E)  a negative relationship between y and x.

Question 8

The ________ of something is the gain or pleasure that it brings.

Accepted Answer

A)  benefit 
B)  rational choice 
C)  opportunity cost 
D)  rational margin 
E)  marginal cost 
A)  benefit 
B)  rational choice 
C)  opportunity cost 
D)  rational margin 
E)  marginal cost

Question 9

You have chosen to take a trip during the mid-semester break. If you had not gone, you would either have worked at a temporary job or studied for exams. The opportunity cost of your trip is

Accepted Answer

A)  We cannot determine what the opportunity cost is without knowing which alternative, working or studying, you would have preferred. 
B)  the wages you would have earned from working. 
C)  the wages you would have earned from working and the lower grade earned by not studying. 
D)  the value of the trip. 
E)  the lower grade earned by not studying. 
A)  We cannot determine what the opportunity cost is without knowing which alternative, working or studying, you would have preferred. 
B)  the wages you would have earned from working. 
C)  the wages you would have earned from working and the lower grade earned by not studying. 
D)  the value of the trip. 
E)  the lower grade earned by not studying.

Question 10

Which of the following is the best example of a 'what?' question?

Accepted Answer

A)  Should higher-income or lower-income people buy SUVs? 
B)  Should cars be produced using workers or robots? 
C)  Should we make faster microprocessors or pest-resistant corn? 
D)  Should migrant workers or domestic workers be used to pick grapes? 
E)  What should doctors be paid? 
A)  Should higher-income or lower-income people buy SUVs? 
B)  Should cars be produced using workers or robots? 
C)  Should we make faster microprocessors or pest-resistant corn? 
D)  Should migrant workers or domestic workers be used to pick grapes? 
E)  What should doctors be paid?

Question 11

If the marginal benefit of the next slice of pizza exceeds the marginal cost, you will

Accepted Answer

A)  not eat the slice of pizza. 
B)  eat the slice of pizza. 
C)  eat half the slice. 
D)  be unable to choose between eating and not eating. 
E)  More information is needed about how much the marginal benefit exceeds the marginal cost to determine if you will or will not eat the slice. 
A)  not eat the slice of pizza. 
B)  eat the slice of pizza. 
C)  eat half the slice. 
D)  be unable to choose between eating and not eating. 
E)  More information is needed about how much the marginal benefit exceeds the marginal cost to determine if you will or will not eat the slice.

Question 12

Decision making on the margin involves

Accepted Answer

A)  eliminating the additional cost when making a decision. 
B)  comparing the total cost and the total benefit when making a decision. 
C)  comparing the marginal cost and marginal benefit when making a decision. 
D)  comparing the benefits for the social interest to the benefits for the person's self-interest. 
E)  determining the total benefit of a decision. 
A)  eliminating the additional cost when making a decision. 
B)  comparing the total cost and the total benefit when making a decision. 
C)  comparing the marginal cost and marginal benefit when making a decision. 
D)  comparing the benefits for the social interest to the benefits for the person's self-interest. 
E)  determining the total benefit of a decision.

Question 13

Scarcity exists because:

Accepted Answer

A)  human wants exceed the resources available to satisfy them. 
B)  some people make bad economic decisions. 
C)  people take too much leisure time. 
D)  some individuals have low incomes. 
E)  the costs of production are high. 
A)  human wants exceed the resources available to satisfy them. 
B)  some people make bad economic decisions. 
C)  people take too much leisure time. 
D)  some individuals have low incomes. 
E)  the costs of production are high.

Question 14

A slope is measured as the:

Accepted Answer

A)  value of the variable measured on the x-axis minus the value of the variable measured on the y-axis. 
B)  change in the value of variable on the y-axis divided by the change in the value of the variable on the x-axis. 
C)  value of the variable measured on the y-axis divided by the value of the variable measured on the x-axis. 
D)  value of the variable measured on the y-axis minus the value of the variable measured on the x-axis. 
E)  value of the variable measured on the x-axis divided by the value of the variable measured on the y-axis. 
A)  value of the variable measured on the x-axis minus the value of the variable measured on the y-axis. 
B)  change in the value of variable on the y-axis divided by the change in the value of the variable on the x-axis. 
C)  value of the variable measured on the y-axis divided by the value of the variable measured on the x-axis. 
D)  value of the variable measured on the y-axis minus the value of the variable measured on the x-axis. 
E)  value of the variable measured on the x-axis divided by the value of the variable measured on the y-axis.

Question 15

-A steep slope in a time-series graph means the variable is

Accepted Answer

A)  rising or falling quickly. 
B)  rising or falling slowly. 
C)  very close to its trend point. 
D)  falling. 
E)  high. 
A)  rising or falling quickly. 
B)  rising or falling slowly. 
C)  very close to its trend point. 
D)  falling. 
E)  high.

Question 16

We are investigating the relationship among three variables. We have graphed two of them. Suppose that the variable that is not measured on the x-axis or the y-axis changes. Then, there is

Accepted Answer

A)  an omitted variable. 
B)  a violation of the absence of trend assumption. 
C)  a shift in the plotted curve. 
D)  a movement along the plotted curve. 
E)  no impact on the plotted curve because the variable is not measured on either of the axes. 
A)  an omitted variable. 
B)  a violation of the absence of trend assumption. 
C)  a shift in the plotted curve. 
D)  a movement along the plotted curve. 
E)  no impact on the plotted curve because the variable is not measured on either of the axes.

Question 17

Matt pays a $50 a month membership fee at Bruno's Gym. He can exercise at the gym as many times as he wishes. If the membership fee is measured along the vertical axis and the number of times he exercises is measured along the horizontal axis, the graph between his membership fee and the number of times he exercises will

Accepted Answer

A)  start out positively sloped and then, as Matt loses interest, become negatively sloped. 
B)  be a horizontal line. 
C)  be negatively sloped. 
D)  be a vertical line. 
E)  be positively sloped. 
A)  start out positively sloped and then, as Matt loses interest, become negatively sloped. 
B)  be a horizontal line. 
C)  be negatively sloped. 
D)  be a vertical line. 
E)  be positively sloped.

Question 18

A graph shows that the number of Australian tourists visiting a Caribbean island increases as the temperature in southern Australia falls. The graph shows

Accepted Answer

A)  a direct relationship. 
B)  a negative relationship. 
C)  an invalid relationship. 
D)  no relationship. 
E)  a positive relationship. 
A)  a direct relationship. 
B)  a negative relationship. 
C)  an invalid relationship. 
D)  no relationship. 
E)  a positive relationship.

Question 19

Which economic question depends on the incomes that people earn and the prices they pay for goods and services?

Accepted Answer

A)  For whom? 
B)  What? 
C)  Where? 
D)  How? 
E)  Why? 
A)  For whom? 
B)  What? 
C)  Where? 
D)  How? 
E)  Why?

Question 20

Which of the following is a positive statement?

Accepted Answer

A)  The class average on this test should be more than 80 per cent. 
B)  A 10 per cent increase in income leads to a 4 per cent increase in the consumption of beef. 
C)  Taxes should be lower because then people get to keep more of what they earn, so they will work more. 
D)  Given their negative impact on productivity, the government should eliminate labour unions. 
E)  My economics class should last for two terms because it is my favourite class. 
A)  The class average on this test should be more than 80 per cent. 
B)  A 10 per cent increase in income leads to a 4 per cent increase in the consumption of beef. 
C)  Taxes should be lower because then people get to keep more of what they earn, so they will work more. 
D)  Given their negative impact on productivity, the government should eliminate labour unions. 
E)  My economics class should last for two terms because it is my favourite class.

A trend is

The opportunity cost of a decision is measured in terms of

What is NOT true about rational choice?

If x increases whenever y decreases, then x and y are

Which of the following statements best describes the study of economics?

A linear relationship

If the change in y = 10 and the change in x = 3, there is

The ________ of something is the gain or pleasure that it brings.

You have chosen to take a trip during the mid-semester break. If you had not gone, you would either have worked at a temporary job or studied for exams. The opportunity cost of your trip is

Which of the following is the best example of a 'what?' question?

If the marginal benefit of the next slice of pizza exceeds the marginal cost, you will

Decision making on the margin involves

Scarcity exists because:

A slope is measured as the:

-A steep slope in a time-series graph means the variable is

We are investigating the relationship among three variables. We have graphed two of them. Suppose that the variable that is not measured on the x-axis or the y-axis changes. Then, there is

A graph shows that the number of Australian tourists visiting a Caribbean island increases as the temperature in southern Australia falls. The graph shows

Which economic question depends on the incomes that people earn and the prices they pay for goods and services?

Which of the following is a positive statement?

The Australian and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 1: Getting Started

A trend is

The opportunity cost of a decision is measured in terms of

What is NOT true about rational choice?

If x increases whenever y decreases, then x and y are

Which of the following statements best describes the study of economics?

A linear relationship

If the change in y = 10 and the change in x = 3, there is

The ________ of something is the gain or pleasure that it brings.

You have chosen to take a trip during the mid-semester break. If you had not gone, you would either have worked at a temporary job or studied for exams. The opportunity cost of your trip is

Which of the following is the best example of a 'what?' question?

If the marginal benefit of the next slice of pizza exceeds the marginal cost, you will

Decision making on the margin involves

Scarcity exists because:

A slope is measured as the:

-A steep slope in a time-series graph means the variable is

We are investigating the relationship among three variables. We have graphed two of them. Suppose that the variable that is not measured on the x-axis or the y-axis changes. Then, there is

A graph shows that the number of Australian tourists visiting a Caribbean island increases as the temperature in southern Australia falls. The graph shows

Which economic question depends on the incomes that people earn and the prices they pay for goods and services?

Which of the following is a positive statement?

The Australian and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters