Question 1

The assumption of rational self-interest does not rule out the possibility of concern for other individuals.

Accepted Answer

A) True 
 B)False

Question 2

Because people's wants are unlimited but resources are scarce,_____:

Accepted Answer

A) only the rich get everything they want. 
B) choices must be made. 
C) there will be more services produced than goods. 
D) people search for spiritual fulfillment rather than material fulfillment. 
E) poor people never get anything they want. 
A) only the rich get everything they want. 
B) choices must be made. 
C) there will be more services produced than goods. 
D) people search for spiritual fulfillment rather than material fulfillment. 
E) poor people never get anything they want.

Question 3

Which of the following is a service?

Accepted Answer

A) Anything that is scarce and that satisfies unlimited human wants 
B) A thing for which people pay money 
C) An intangible activity that satisfies human wants 
D) Any output produced by a service sector industry,such as fast food 
E) Something less desirable than a good 
A) Anything that is scarce and that satisfies unlimited human wants 
B) A thing for which people pay money 
C) An intangible activity that satisfies human wants 
D) Any output produced by a service sector industry,such as fast food 
E) Something less desirable than a good

Question 4

The behavior of the entertainment industry in a city is a microeconomics topic.

Accepted Answer

A) True 
 B)False

Question 5

Someone who committed the association is causation fallacy might conclude that:

Accepted Answer

A) event B,which followed event A,was caused by the event A. 
B) event B,which followed event A,was not necessarily caused by event A. 
C) the simplest model is the best predictor. 
D) what is true for the individual is also true for the group. 
E) what is true for the individual is not necessarily true for the group. 
A) event B,which followed event A,was caused by the event A. 
B) event B,which followed event A,was not necessarily caused by event A. 
C) the simplest model is the best predictor. 
D) what is true for the individual is also true for the group. 
E) what is true for the individual is not necessarily true for the group.

Question 6

In economics,capital is defined as:

Accepted Answer

A) natural resources,such as water,oil,and iron ore. 
B) the natural,unskilled abilities of people. 
C) human creations used in the production process. 
D) money and other financial assets. 
E) the willingness of business owners to take risks. 
A) natural resources,such as water,oil,and iron ore. 
B) the natural,unskilled abilities of people. 
C) human creations used in the production process. 
D) money and other financial assets. 
E) the willingness of business owners to take risks.

Question 7

Alicia makes the statement that every time she eats chocolate,she gets acne.By ignoring the possibility that there may be another factor that causes Alicia to eat chocolate and which also causes her acne,Alicia is committing the:

Accepted Answer

A) fallacy of composition. 
B) fallacy that association is causation. 
C) fallacy of segmentation. 
D) mistake of ignoring secondary effects. 
E) mistake of looking beyond the obvious. 
A) fallacy of composition. 
B) fallacy that association is causation. 
C) fallacy of segmentation. 
D) mistake of ignoring secondary effects. 
E) mistake of looking beyond the obvious.

Question 8

Step one in the scientific method is to:

Accepted Answer

A) formulate a hypothesis. 
B) reflect an opinion. 
C) specify assumptions. 
D) identify the question and define relevant variables. 
E) test the hypothesis. 
A) formulate a hypothesis. 
B) reflect an opinion. 
C) specify assumptions. 
D) identify the question and define relevant variables. 
E) test the hypothesis.

Question 9

Economists often focus on average behavior because it is easier to predict.

Accepted Answer

A) True 
 B)False

Question 10

All economic models must involve simplifications because:

Accepted Answer

A) economists would be unable to command high salaries if their models were so simple that anyone could understand them. 
B) human behavior is very erratic and unpredictable. 
C) reality is too complex to understand in its entirety,so we must reduce the complexity to a level that we can understand. 
D) they always try to duplicate all possible information and cover all possible variables that might influence decision making. 
E) we must rely on value judgments and ignore reality. 
A) economists would be unable to command high salaries if their models were so simple that anyone could understand them. 
B) human behavior is very erratic and unpredictable. 
C) reality is too complex to understand in its entirety,so we must reduce the complexity to a level that we can understand. 
D) they always try to duplicate all possible information and cover all possible variables that might influence decision making. 
E) we must rely on value judgments and ignore reality.

Question 11

Economic theory:

Accepted Answer

A) expresses normative values. 
B) invents imaginative and interesting stories. 
C) predicts the behavior of a specific economic decision maker after an economic change. 
D) predicts the average behavior of a group of similar economic decision makers after an economic change. 
E) uses only perfect and complete information. 
A) expresses normative values. 
B) invents imaginative and interesting stories. 
C) predicts the behavior of a specific economic decision maker after an economic change. 
D) predicts the average behavior of a group of similar economic decision makers after an economic change. 
E) uses only perfect and complete information.

Question 12

The payments in return for labor and capital are _____,respectively.

Accepted Answer

A) profit and rent 
B) interest and profit 
C) rent and wages 
D) profit and wages 
E) wages and interest 
A) profit and rent 
B) interest and profit 
C) rent and wages 
D) profit and wages 
E) wages and interest

Question 13

Economics is as much an art as it is a science.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is an accurate list,in order,of the steps of the scientific method?

Accepted Answer

A) Define variables;state assumptions;form a hypothesis;test 
B) State assumptions;define variables;form a hypothesis;test 
C) Identify variables;state assumptions;test;form a hypothesis 
D) Identify variables;form a hypothesis;form behavioral assumptions;test 
E) Define assumptions;form behavioral assumptions;form hypothesis;test 
A) Define variables;state assumptions;form a hypothesis;test 
B) State assumptions;define variables;form a hypothesis;test 
C) Identify variables;state assumptions;test;form a hypothesis 
D) Identify variables;form a hypothesis;form behavioral assumptions;test 
E) Define assumptions;form behavioral assumptions;form hypothesis;test

Question 15

Economic theories are:

Accepted Answer

A) useful because they are as exact as theories in the physical sciences. 
B) useless because they are based on abstractions. 
C) useful because they allow us to make predictions. 
D) too complex to understand because they include all of reality. 
E) useful in predicting events only if their assumptions are realistic. 
A) useful because they are as exact as theories in the physical sciences. 
B) useless because they are based on abstractions. 
C) useful because they allow us to make predictions. 
D) too complex to understand because they include all of reality. 
E) useful in predicting events only if their assumptions are realistic.

Question 16

The expression "There's no such thing as a free lunch" means that:

Accepted Answer

A) services may be free,but goods are never free. 
B) even if it has a price of zero,a good or service has a cost. 
C) charitable organizations should not serve free lunches to the poor. 
D) poor people are really the ones who pay for their allegedly free lunches. 
E) someone has to pay the market price for a good or service. 
A) services may be free,but goods are never free. 
B) even if it has a price of zero,a good or service has a cost. 
C) charitable organizations should not serve free lunches to the poor. 
D) poor people are really the ones who pay for their allegedly free lunches. 
E) someone has to pay the market price for a good or service.

Question 17

In a circular-flow model,households supply all of the following except:

Accepted Answer

A) labor. 
B) goods and services. 
C) capital. 
D) entrepreneurial ability. 
E) natural resources. 
A) labor. 
B) goods and services. 
C) capital. 
D) entrepreneurial ability. 
E) natural resources.

Question 18

Economic information:​

Accepted Answer

A) is usually scarce and costly to acquire. 
B) is usually available free to any decision maker. 
C) is usually not required for rational decision making. 
D) must be complete before any decision is made. 
E) is usually useful only to governments. 
A) is usually scarce and costly to acquire. 
B) is usually available free to any decision maker. 
C) is usually not required for rational decision making. 
D) must be complete before any decision is made. 
E) is usually useful only to governments.

Question 19

Patrick decided to go to class today instead of going to the movies.He made this decision because:

Accepted Answer

A) Patrick's additional benefit of going to class exceeds the additional cost of going to class. 
B) Patrick's additional benefit of going to the movies exceeds the additional cost of going to class. 
C) Patrick's additional benefit of going to class exceeds the additional cost of going to the movies. 
D) Patrick's additional benefit of going to the movies exceeds the additional cost of going to the movies. 
E) Patrick's additional benefit of going to class equals the additional cost of going to the movies. 
A) Patrick's additional benefit of going to class exceeds the additional cost of going to class. 
B) Patrick's additional benefit of going to the movies exceeds the additional cost of going to class. 
C) Patrick's additional benefit of going to class exceeds the additional cost of going to the movies. 
D) Patrick's additional benefit of going to the movies exceeds the additional cost of going to the movies. 
E) Patrick's additional benefit of going to class equals the additional cost of going to the movies.

Question 20

In economics,capital refers to:

Accepted Answer

A) money. 
B) stocks,bonds,and other financial assets. 
C) the seat of the government. 
D) machines,buildings,tools,and knowledge. 
E) net worth (assets minus liabilities). 
A) money. 
B) stocks,bonds,and other financial assets. 
C) the seat of the government. 
D) machines,buildings,tools,and knowledge. 
E) net worth (assets minus liabilities).

The assumption of rational self-interest does not rule out the possibility of concern for other individuals.

Because people's wants are unlimited but resources are scarce,_____:

Which of the following is a service?

The behavior of the entertainment industry in a city is a microeconomics topic.

Someone who committed the association is causation fallacy might conclude that:

In economics,capital is defined as:

Alicia makes the statement that every time she eats chocolate,she gets acne.By ignoring the possibility that there may be another factor that causes Alicia to eat chocolate and which also causes her acne,Alicia is committing the:

Step one in the scientific method is to:

Economists often focus on average behavior because it is easier to predict.

All economic models must involve simplifications because:

Economic theory:

The payments in return for labor and capital are _____,respectively.

Economics is as much an art as it is a science.

Which of the following is an accurate list,in order,of the steps of the scientific method?

Economic theories are:

The expression "There's no such thing as a free lunch" means that:

In a circular-flow model,households supply all of the following except:

Economic information:

Patrick decided to go to class today instead of going to the movies.He made this decision because:

In economics,capital refers to:

Some Tools of Economic Analysis

Economic Decision Makers

Demand, Supply, and Markets

Introduction to Macroeconomics

Tracking the U S Economy

Unemployment and Inflation

Us Productivity and Growth

Aggregate Demand

Aggregate Supply

Fiscal Policy

Federal Budgets and Public Policy

Money and the Financial System

Banking and the Money Supply

Monetary Theory and Policy

The Policy Debate: Active or Passive

International Trade

International Finance

Economic Development

Filters

Exam 1: The Art and Science of Economic Analysis

The assumption of rational self-interest does not rule out the possibility of concern for other individuals.

Because people's wants are unlimited but resources are scarce,_____:

Which of the following is a service?

The behavior of the entertainment industry in a city is a microeconomics topic.

Someone who committed the association is causation fallacy might conclude that:

In economics,capital is defined as:

Alicia makes the statement that every time she eats chocolate,she gets acne.By ignoring the possibility that there may be another factor that causes Alicia to eat chocolate and which also causes her acne,Alicia is committing the:

Step one in the scientific method is to:

Economists often focus on average behavior because it is easier to predict.

All economic models must involve simplifications because:

Economic theory:

The payments in return for labor and capital are _____,respectively.

Economics is as much an art as it is a science.

Which of the following is an accurate list,in order,of the steps of the scientific method?

Economic theories are:

The expression "There's no such thing as a free lunch" means that:

In a circular-flow model,households supply all of the following except:

Economic information:​

Patrick decided to go to class today instead of going to the movies.He made this decision because:

In economics,capital refers to:

Some Tools of Economic Analysis

Economic Decision Makers

Demand, Supply, and Markets

Introduction to Macroeconomics

Tracking the U S Economy

Unemployment and Inflation

Us Productivity and Growth

Aggregate Demand

Aggregate Supply

Fiscal Policy

Federal Budgets and Public Policy

Money and the Financial System

Banking and the Money Supply

Monetary Theory and Policy

The Policy Debate: Active or Passive

International Trade

International Finance

Economic Development

Filters

Economic information: