Question 1

An economist has data showing household income and energy consumption for 10 000 Canadian households. The best way to illustrate these data is

Accepted Answer

A)  a time-series line graph. 
B)  a cross-sectional bar-chart graph. 
C)  a scatter diagram. 
D)  a logarithmic scale diagram. 
E)  a time-series bar chart diagram. 
A)  a time-series line graph. 
B)  a cross-sectional bar-chart graph. 
C)  a scatter diagram. 
D)  a logarithmic scale diagram. 
E)  a time-series bar chart diagram. C

Question 2

On a coordinate graph with y on the vertical axis and x on the horizontal axis, suppose that two points on a straight line are X = 4, Y = 5), and X = 2, Y = 1). The slope of this line is

Accepted Answer

A)  -2. 
B)  - 1 . 2 
C)  1 . 2 
D)  4 . 5 
E)  2. 
A)  -2. 
B)  - 1 . 2 
C)  1 . 2 
D)  4 . 5 
E)  2. E

Question 3

The table below shows hypothetical data for the volume of gold and nickel output across several years.   TABLE 2-5
-Refer to Table 2-5. What is the index number for gold output in Year 8?

Accepted Answer

A)  111.9 
B)  111.9% 
C)  11.9 
D)  11.9% 
E)  1.119 
A)  111.9 
B)  111.9% 
C)  11.9 
D)  11.9% 
E)  1.119 A

Question 4

What is the best way to display the unemployment rate in each of the worldʹs developed economies in 2015?

Accepted Answer

A)  a time series line graph 
B)  a scatter diagram 
C)  a scatter diagram with two variables 
D)  a cross-sectional graph with time-series data 
E)  a cross-sectional bar chart graph 
A)  a time series line graph 
B)  a scatter diagram 
C)  a scatter diagram with two variables 
D)  a cross-sectional graph with time-series data 
E)  a cross-sectional bar chart graph

Question 5

An economist has data showing Canadian GDP for the years 1945 -2015. The best way to illustrate these data is

Accepted Answer

A)  a time-series line graph. 
B)  a cross-sectional bar-chart graph. 
C)  a scatter diagram. 
D)  a logarithmic scale diagram. 
E)  a time-series pie chart. 
A)  a time-series line graph. 
B)  a cross-sectional bar-chart graph. 
C)  a scatter diagram. 
D)  a logarithmic scale diagram. 
E)  a time-series pie chart.

Question 6

Negatively related variables change such that as the value of one variable

Accepted Answer

A)  decreases, the value of the other variable remains the same. 
B)  increases, the value of the other variable increases. 
C)  increases, the value of the other variable remains the same. 
D)  decreases, the value of the other variable decreases. 
E)  increases, the value of the other decreases. 
A)  decreases, the value of the other variable remains the same. 
B)  increases, the value of the other variable increases. 
C)  increases, the value of the other variable remains the same. 
D)  decreases, the value of the other variable decreases. 
E)  increases, the value of the other decreases.

Question 7

Suppose there is a theory that several things influence the price of fish in Halifax, one of which is the weather during the fishing season. When examining the determinants of the price of fish, the weather is

Accepted Answer

A)  an endogenous variable, as it influences the price of fish. 
B)  an exogenous variable, as it is determined outside the theory. 
C)  a stock, as it influences the quantity of fish caught. 
D)  an act of God and, therefore, has no legitimate connection with the theory. 
E)  an endogenous variable, as it is determined within the theory. 
A)  an endogenous variable, as it influences the price of fish. 
B)  an exogenous variable, as it is determined outside the theory. 
C)  a stock, as it influences the quantity of fish caught. 
D)  an act of God and, therefore, has no legitimate connection with the theory. 
E)  an endogenous variable, as it is determined within the theory.

Question 8

The table below shows the approximate value of Canadaʹs crude oil and natural gas exports over a 5 -year period. The amounts shown are billions of dollars.   TABLE 2-7
-Refer to Table 2-7. Assume that 2009 is the base year, with an index number = 100. What is the index number for the value of natural gas exports in 2013?

Accepted Answer

A)  70.6 
B)  1.42 
C)  142 
D)  142% 
E)  14.2 
A)  70.6 
B)  1.42 
C)  142 
D)  142% 
E)  14.2

Question 9

The table below shows hypothetical data for the volume of gold and nickel output across several years.   TABLE 2-6
-Refer to Table 2-6. What is the index number for nickel output in Year 5?

Accepted Answer

A)  -200 
B)  -200% 
C)  96 
D)  0.96% 
E)  96% 
A)  -200 
B)  -200% 
C)  96 
D)  0.96% 
E)  96%

Question 10

FIGURE 2-1
-Refer to Figure 2-1. What is the slope of the line in part i) of the figure?

Accepted Answer

A)  -10 
B)  5 
C)  -5 
D)  -1 
E)  1 
A)  -10 
B)  5 
C)  -5 
D)  -1 
E)  1

Question 11

The table below shows hypothetical data for volumes of e-books and hardcover books sold over a 3-year period in a particular city.   TABLE 2-3
-Refer to Table 2-3. Suppose we choose Year 1 as the base year and construct a series of index numbers with which to analyze the sales data. The index numbers for volumes of e-books sold starting with Year 1) is

Accepted Answer

A)  100; 44.2; 21.7. 
B)  100; 226.1; 460.9. 
C)  23 000; 52 000; 106 000. 
D)  100; 126.1; 360.1. 
E)  1; 0.442; 0.217. 
A)  100; 44.2; 21.7. 
B)  100; 226.1; 460.9. 
C)  23 000; 52 000; 106 000. 
D)  100; 126.1; 360.1. 
E)  1; 0.442; 0.217.

Question 12

When an increase in one variable is associated with a decrease in a second variable, the two variables are

Accepted Answer

A)  proportionally related. 
B)  inversely proportionally related. 
C)  positively related. 
D)  equivalent. 
E)  negatively related. 
A)  proportionally related. 
B)  inversely proportionally related. 
C)  positively related. 
D)  equivalent. 
E)  negatively related.

Question 13

The statement ʺY is a function of Xʺ means that the

Accepted Answer

A)  value of Y depends on that of X. 
B)  value of X depends on that of Y. 
C)  values of Y and X are the same. 
D)  values of Y and X are independent. 
E)  values of Y and X are related to some third variable. 
A)  value of Y depends on that of X. 
B)  value of X depends on that of Y. 
C)  values of Y and X are the same. 
D)  values of Y and X are independent. 
E)  values of Y and X are related to some third variable.

Question 14

FIGURE 2-3
-At the minimum or the maximum of the graph of a non-linear function with x on the horizontal axis and y on the vertical axis) the slope of the curve is

Accepted Answer

A)  1. 
B)  -1. 
C)  0. 
D)  infinite. 
E)  undefined. 
A)  1. 
B)  -1. 
C)  0. 
D)  infinite. 
E)  undefined.

Question 15

Suppose a theory predicts that lowering tuition fees at Canadian universities will increase enrollment from low-income households. If empirical evidence is inconsistent with this prediction, then we

Accepted Answer

A)  need to amend the theory. 
B)  should test the theory again. 
C)  should change the empirical data. 
D)  should increase tuition fees back to their initial level. 
E)  change the exogenous variables in the theory. 
A)  need to amend the theory. 
B)  should test the theory again. 
C)  should change the empirical data. 
D)  should increase tuition fees back to their initial level. 
E)  change the exogenous variables in the theory.

Question 16

FIGURE 2-1
-Refer to Figure 2-1. What is the slope of the line in part ii) of the figure?

Accepted Answer

A)  12.5 
B)  -12.5 
C)  1 
D)  0.05 
E)  0.08 
A)  12.5 
B)  -12.5 
C)  1 
D)  0.05 
E)  0.08

Question 17

The table below shows hypothetical per-minute cell phone charges for ʺpay-and-talkʺ service over several years.   TABLE 2-2
-Refer to Table 2-2. Assume that 2008 is used as the base year, with the index number = 100. The value of the index number in 2011 is calculated as follows:

Accepted Answer

A)  0.35 × 100 = 35. 
B)  0.35/0.55 = 0.64. 
C)  0.55/0.35 = 1.57. 
D)  0.35/0.55) × 100 = 63.64. 
E)  0.55/0.35) × 100 = 157.14. 
A)  0.35 × 100 = 35. 
B)  0.35/0.55 = 0.64. 
C)  0.55/0.35 = 1.57. 
D)  0.35/0.55) × 100 = 63.64. 
E)  0.55/0.35) × 100 = 157.14.

Question 18

Suppose economists at the World Bank develop a theory with a prediction that increased levels of foreign aid lead to increases in per capita GDP in the recipient developing countries. They find empirical evidence that is consistent with this theory. The economists are able to conclude that

Accepted Answer

A)  the theory is valid, but should be subjected to continued scrutiny. 
B)  the theory has been proven correct. 
C)  the theory is always reliable. 
D)  the evidence is rejected by the theory. 
E)  the assumptions used in the theory have been proven correct. 
A)  the theory is valid, but should be subjected to continued scrutiny. 
B)  the theory has been proven correct. 
C)  the theory is always reliable. 
D)  the evidence is rejected by the theory. 
E)  the assumptions used in the theory have been proven correct.

Question 19

An economist collects data comparing per-capita expenditures on health care across provinces and territories for the year 2015. The best way to illustrate this data is

Accepted Answer

A)  a time-series line graph. 
B)  a cross-sectional bar-chart graph. 
C)  a scatter diagram. 
D)  a logarithmic scale diagram. 
E)  a time-series bar chart diagram. 
A)  a time-series line graph. 
B)  a cross-sectional bar-chart graph. 
C)  a scatter diagram. 
D)  a logarithmic scale diagram. 
E)  a time-series bar chart diagram.

Question 20

The table below shows the approximate value of Canadaʹs crude oil and natural gas exports over a 5 -year period. The amounts shown are billions of dollars.   TABLE 2-7
-Refer to Table 2-7. Assume that 2009 is the base year, with an index number = 100. What is the index number for the value of crude oil exports in 2013?

Accepted Answer

A)  52.5 
B)  52.5% 
C)  38.5 
D)  90.6 
E)  190.6 
A)  52.5 
B)  52.5% 
C)  38.5 
D)  90.6 
E)  190.6

Exam 2: Economic Theories, Data, and Graphs

An economist has data showing household income and energy consumption for 10 000 Canadian households. The best way to illustrate these data is

On a coordinate graph with y on the vertical axis and x on the horizontal axis, suppose that two points on a straight line are X = 4, Y = 5), and X = 2, Y = 1). The slope of this line is

The table below shows hypothetical data for the volume of gold and nickel output across several years. TABLE 2-5 -Refer to Table 2-5. What is the index number for gold output in Year 8?

What is the best way to display the unemployment rate in each of the worldʹs developed economies in 2015?

An economist has data showing Canadian GDP for the years 1945 -2015. The best way to illustrate these data is

Negatively related variables change such that as the value of one variable

Suppose there is a theory that several things influence the price of fish in Halifax, one of which is the weather during the fishing season. When examining the determinants of the price of fish, the weather is

The table below shows hypothetical data for the volume of gold and nickel output across several years. TABLE 2-6 -Refer to Table 2-6. What is the index number for nickel output in Year 5?

FIGURE 2-1 -Refer to Figure 2-1. What is the slope of the line in part i) of the figure?

When an increase in one variable is associated with a decrease in a second variable, the two variables are

The statement ʺY is a function of Xʺ means that the

FIGURE 2-3 -At the minimum or the maximum of the graph of a non-linear function with x on the horizontal axis and y on the vertical axis) the slope of the curve is

Suppose a theory predicts that lowering tuition fees at Canadian universities will increase enrollment from low-income households. If empirical evidence is inconsistent with this prediction, then we

FIGURE 2-1 -Refer to Figure 2-1. What is the slope of the line in part ii) of the figure?

The table below shows hypothetical per-minute cell phone charges for ʺpay-and-talkʺ service over several years. TABLE 2-2 -Refer to Table 2-2. Assume that 2008 is used as the base year, with the index number = 100. The value of the index number in 2011 is calculated as follows:

Suppose economists at the World Bank develop a theory with a prediction that increased levels of foreign aid lead to increases in per capita GDP in the recipient developing countries. They find empirical evidence that is consistent with this theory. The economists are able to conclude that

An economist collects data comparing per-capita expenditures on health care across provinces and territories for the year 2015. The best way to illustrate this data is

Economic Issues and Concepts

Demand, Supply, and Price

Elasticity

Price Controls and Market Efficiency

Consumer Behaviour

Producers in the Short Run

Producers in the Long Run

Competitive Markets

Monopoly, Cartels, and Price Discrimination

Imperfect Competition and Strategic Behaviour

Economic Efficiency and Public Policy

How Factor Markets Work

Labour Markets and Income Inequality

Market Failures and Government Intervention

The Economics of Environmental Protection

Taxation and Public Expenditure

What Macroeconomics Is All About

The Measurement of National Income

The Simplest Short-Run Macro Model

Adding Government and Trade to the Simple Macro Model

Output and Prices in the Short Run

From the Short Run to the Long Run: the Adjustment of Factor Prices

Long-Run Economic Growth

Money and Banking

Money, Interest Rates, and Economic Activity

Monetary Policy in Canada

Inflation and Disinflation

Unemployment Fluctuations and the Nairu

Government Debt and Deficits

The Gains From International Trade

Trade Policy

Exchange Rates and the Balance of Payments

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