Question 1

Every citizen in the United States should be required to become licensed to carry a firearm for the sake of protection. This statement is best described as

Accepted Answer

A)  a positive statement. 
B)  a normative statement. 
C)  a marginal statement. 
D)  an implication of an efficient market. 
A)  a positive statement. 
B)  a normative statement. 
C)  a marginal statement. 
D)  an implication of an efficient market.

Question 2

Related to the Economics in Practice on page 3: According to the Economics in Practice, when rains in rural India are plentiful, the opportunity cost of having someone out of the labor force, and therefore unable to work in agricultural production,

Accepted Answer

A)  increases. 
B)  decreases. 
C)  remains unchanged. 
D)  is zero, because the person is out of the labor force. 
A)  increases. 
B)  decreases. 
C)  remains unchanged. 
D)  is zero, because the person is out of the labor force.

Question 3

Opportunity cost is

Accepted Answer

A)  that which we forgo, or give up, when we make a choice or a decision. 
B)  a cost that cannot be avoided, regardless of what is done in the future. 
C)  the additional cost of producing an additional unit of output. 
D)  the additional cost of buying an additional unit of a product. 
A)  that which we forgo, or give up, when we make a choice or a decision. 
B)  a cost that cannot be avoided, regardless of what is done in the future. 
C)  the additional cost of producing an additional unit of output. 
D)  the additional cost of buying an additional unit of a product.

Question 4

Refer to Scenario 1.2 below to answer the question(s) that follow.
SCENARIO 1.2: A scientist wants to understand the relationship between automobile emissions and the level of global warming. The scientist collects data on the volume of automobile emissions and the levels of global warming over time. The scientist concludes that a 1% increase in automobile emissions causes a 0.0003% increase in average global temperatures. From this information he concludes that the automobile emissions are harmful to the environment and should be reduced to stop the increase in global temperatures.
-Refer to Scenario 1.2. The statement that a 1% increase in the automobile emissions causes a 0.0003% increase in average global temperatures is an example of

Accepted Answer

A)  positive economics. 
B)  marginal economics. 
C)  normative economics. 
D)  the fallacy of logic. 
A)  positive economics. 
B)  marginal economics. 
C)  normative economics. 
D)  the fallacy of logic.

Question 5

Dividing the change in quantity on the horizontal axis by the change in quantity on the vertical axis calculates the slope of a line.

Accepted Answer

A) True 
 B)False

Question 6

Ockham's razor is the principle that states

Accepted Answer

A)  supply creates its own demand. 
B)  we must forgo something when making a decision. 
C)  costs which have been incurred cannot be avoided. 
D)  irrelevant detail should not be included in a model. 
A)  supply creates its own demand. 
B)  we must forgo something when making a decision. 
C)  costs which have been incurred cannot be avoided. 
D)  irrelevant detail should not be included in a model.

Question 7

Refer to the information provided in Figure 1.3 below to answer the question(s) that follow.   Figure 1.3
-Refer to Figure 1.3. At Point A the slope of the line is 3, so at Point D the slope would be

Accepted Answer

A)  greater than 3. 
B)  less than 3. 
C)  equal to 3. 
D)  indeterminate from this information. 
A)  greater than 3. 
B)  less than 3. 
C)  equal to 3. 
D)  indeterminate from this information.

Question 8

Opportunity cost is

Accepted Answer

A)  the additional cost incurred from the consumption of one more unit of output. 
B)  the cost involved when choosing between alternatives. 
C)  the cost of production which cannot be recaptured. 
D)  the total cost incurred from the consumption of additional output. 
A)  the additional cost incurred from the consumption of one more unit of output. 
B)  the cost involved when choosing between alternatives. 
C)  the cost of production which cannot be recaptured. 
D)  the total cost incurred from the consumption of additional output.

Question 9

Refer to the information provided in Figure 1.3 below to answer the question(s) that follow.   Figure 1.3
-Refer to Figure 1.3. The slope of the line between Points B and D is

Accepted Answer

A)  -3. 
B)  -0.33. 
C)  0.33. 
D)  3. 
A)  -3. 
B)  -0.33. 
C)  0.33. 
D)  3.

Question 10

If the slope of a straight line is 4 and if Y (the variable on the vertical axis) decreases by 20, then X (the variable on the horizontal axis)

Accepted Answer

A)  increases by 5. 
B)  decreases by 5. 
C)  increases by 80. 
D)  decreases by 80. 
A)  increases by 5. 
B)  decreases by 5. 
C)  increases by 80. 
D)  decreases by 80.

Question 11

Empirical economics refers to the

Accepted Answer

A)  exclusion of irrelevant data when analyzing a model. 
B)  collection and use of data to test economic theories. 
C)  model of economics used prior to the Industrial Revolution. 
D)  belief that what is true for a part is necessarily true for the whole. 
A)  exclusion of irrelevant data when analyzing a model. 
B)  collection and use of data to test economic theories. 
C)  model of economics used prior to the Industrial Revolution. 
D)  belief that what is true for a part is necessarily true for the whole.

Question 12

Related to the Economics in Practice on page 6: According to the Economics in Practice, a majority of the $10 retail value of the Barbie doll

Accepted Answer

A)  is needed to pay for the cost of the Taiwanese plastic used to make the dolls. 
B)  pays for the Chinese labor used to assemble the doll. 
C)  is captured in the United States. 
D)  goes to the Japanese manufacturer of the hair which is used for the dolls. 
A)  is needed to pay for the cost of the Taiwanese plastic used to make the dolls. 
B)  pays for the Chinese labor used to assemble the doll. 
C)  is captured in the United States. 
D)  goes to the Japanese manufacturer of the hair which is used for the dolls.

Question 13

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

Accepted Answer

A)  How will an increase in the price of diesel fuel affect truck drivers? 
B)  What fraction of an income-tax rebate check will be spent on consumer goods? 
C)  Should the government provide free prescription drugs to lower-income citizens? 
D)  How will an increase in the minimum wage affect migrant workers? 
A)  How will an increase in the price of diesel fuel affect truck drivers? 
B)  What fraction of an income-tax rebate check will be spent on consumer goods? 
C)  Should the government provide free prescription drugs to lower-income citizens? 
D)  How will an increase in the minimum wage affect migrant workers?

Question 14

If you eat at a sushi restaurant that charges $20 for its all-you-can-eat sushi special, then the marginal cost of your 10th piece of sushi is

Accepted Answer

A)  zero. 
B)  $2. 
C)  $200. 
D)  $2,000. 
A)  zero. 
B)  $2. 
C)  $200. 
D)  $2,000.

Question 15

Which of the following is not an opportunity cost of attending college?

Accepted Answer

A)  the tuition you pay 
B)  the income you could have earned if you didn't attend college 
C)  the alternative uses of the time you spend studying 
D)  the cost of the food that you consume while you are attending college 
A)  the tuition you pay 
B)  the income you could have earned if you didn't attend college 
C)  the alternative uses of the time you spend studying 
D)  the cost of the food that you consume while you are attending college

Question 16

An efficient market is a market

Accepted Answer

A)  that deals in unlimited resources. 
B)  in which long-term profits are guaranteed. 
C)  in which profit opportunities are eliminated almost instantaneously. 
D)  in which there are no opportunity costs. 
A)  that deals in unlimited resources. 
B)  in which long-term profits are guaranteed. 
C)  in which profit opportunities are eliminated almost instantaneously. 
D)  in which there are no opportunity costs.

Question 17

If information is more costly and less easily available, then usually this

Accepted Answer

A)  makes markets more efficient. 
B)  makes markets less efficient. 
C)  decreases profit opportunities. 
D)  decreases the opportunity cost of acquiring more information. 
A)  makes markets more efficient. 
B)  makes markets less efficient. 
C)  decreases profit opportunities. 
D)  decreases the opportunity cost of acquiring more information.

Question 18

"Post hoc, ergo propter hoc" literally translated means, "all else equal."

Accepted Answer

A) True 
 B)False

Question 19

Refer to the information provided in Figure 1.3 below to answer the question(s) that follow.   Figure 1.3
-Refer to Figure 1.3. The slope of the line between Points D and C is

Accepted Answer

A)  -3. 
B)  -0.33. 
C)  0.33. 
D)  3. 
A)  -3. 
B)  -0.33. 
C)  0.33. 
D)  3.

Question 20

Resources are unlimited in a wealthy society.

Accepted Answer

A) True 
 B)False

Exam 1: The Scope and Method of Economics

Every citizen in the United States should be required to become licensed to carry a firearm for the sake of protection. This statement is best described as

Related to the Economics in Practice on page 3: According to the Economics in Practice, when rains in rural India are plentiful, the opportunity cost of having someone out of the labor force, and therefore unable to work in agricultural production,

Opportunity cost is

Dividing the change in quantity on the horizontal axis by the change in quantity on the vertical axis calculates the slope of a line.

Ockham's razor is the principle that states

Refer to the information provided in Figure 1.3 below to answer the question(s) that follow. Figure 1.3 -Refer to Figure 1.3. At Point A the slope of the line is 3, so at Point D the slope would be

Opportunity cost is

Refer to the information provided in Figure 1.3 below to answer the question(s) that follow. Figure 1.3 -Refer to Figure 1.3. The slope of the line between Points B and D is

If the slope of a straight line is 4 and if Y (the variable on the vertical axis) decreases by 20, then X (the variable on the horizontal axis)

Empirical economics refers to the

Related to the Economics in Practice on page 6: According to the Economics in Practice, a majority of the $10 retail value of the Barbie doll

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

If you eat at a sushi restaurant that charges $20 for its all-you-can-eat sushi special, then the marginal cost of your 10th piece of sushi is

Which of the following is not an opportunity cost of attending college?

An efficient market is a market

If information is more costly and less easily available, then usually this

"Post hoc, ergo propter hoc" literally translated means, "all else equal."

Refer to the information provided in Figure 1.3 below to answer the question(s) that follow. Figure 1.3 -Refer to Figure 1.3. The slope of the line between Points D and C is

Resources are unlimited in a wealthy society.

The Economic Problem: Scarcity and Choice

Demand, Supply, and Market Equilibrium

Demand and Supply Applications

Elasticity

Household Behavior and Consumer Choice

The Production Process: the Behavior of Profit-Maximizing Firms

Short-Run Costs and Output Decisions

Long-Run Costs and Output Decisions

Input Demand: the Labor and Land Markets

Input Demand: the Capital Market and the Investment Decision

General Equilibrium and the Efficiency of Perfect Competition

Monopoly and Antitrust Policy

Oligopoly

Monopolistic Competition

Externalities, Public Goods, and Common Resources

Uncertainty and Asymmetric Information

Income Distribution and Poverty

Public Finance: the Economics of Taxation

International Trade, Comparative Advantage, and Protectionism

Economic Growth in Developing Economies

Critical Thinking About Research

Filters