Exam 1: Introduction: What Is Economics

Macroeconomics helps explain economic fluctuations, why the economy shrinks and expands and why some of the economy's resources are idle.

Would an economist consider clean air a scarce resource? Explain.

The study of the choices made by individual households, firms, and government is called:

Which of the following is not an economic decision in a modern economy?

Government policies concerning the money supply and the control of inflation are topic of concern in microeconomics.

Economics is best defined as the study of:

Macroeconomics involves the study of the decision- making of individuals or individual firms.

Normative economics questions, "What ought to be?" Positive economics predicts the consequences of alternative actions, answering the questions, "What is?" or "What will be?"

An arrangement that allows buyers and sellers to exchange things is called:

Microeconomics is the branch of economics that helps explain economic fluctuations, why the economy shrinks and expands and why some of the economy's resources are idle.

Which of the following is an example of a marginal question?

The economic view of traffic congestion considers

Figure 1.1 -Refer to Figure 1.1. If hours worked are zero in Figure 1.1, then income is

Economists will never reach the same conclusions in their positive analyses.

If each extra driver on the road makes every other drivers commute last one minute longer and there are 600 drivers on the road, then one extra driver costs society

Scarcity can best be defined as a situation in which:

When economists construct economic models,:

Which of the following is not a market?

Economists have found that as a nation's economy grows

If one variable declines the other variable declines, the two variables are negatively related.