Question 1

Economics studies how decision makers use scarce resources to satisfy unlimited wants.

Accepted Answer

A) True 
 B)False

Question 2

Economic theories are:

Accepted Answer

A)  useful because they are as exact as theories in the physical sciences. 
B)  us eless 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)  us eless 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 3

Economists generally believe that:

Accepted Answer

A)  buyers and sellers have all the information they can use. 
B)  additional information is costly to acquire. 
C)  decision makers have complete knowledge of all the alternatives available. 
D)  economic decisions result from random behavior. 
E)  decision makers never make mistakes. 
A)  buyers and sellers have all the information they can use. 
B)  additional information is costly to acquire. 
C)  decision makers have complete knowledge of all the alternatives available. 
D)  economic decisions result from random behavior. 
E)  decision makers never make mistakes.

Question 4

Benjamin works as an economist for the federal government. Which of the following questions is he trying to answer as part of his job?

Accepted Answer

A)  H ow can I get rich by playing the stock market? 
B)  What are the best ways to reduce people's wants, given the scarcity of resources? 
C)  H ow can rational government officials determine what goods should be produced? 
D)  What is money? 
E)  H ow do people use limited resources to try to satisfy unlimited wants? 
A)  H ow can I get rich by playing the stock market? 
B)  What are the best ways to reduce people's wants, given the scarcity of resources? 
C)  H ow can rational government officials determine what goods should be produced? 
D)  What is money? 
E)  H ow do people use limited resources to try to satisfy unlimited wants?

Question 5

Considering both product markets and resource markets, most economic decision makers participate in the economy as both buyers and sellers.

Accepted Answer

A) True 
 B)False

Question 6

A good economic theory:

Accepted Answer

A)  has realistic assumptions. 
B)  contains as much detail as possible. 
C)  cannot be proven false. 
D)  predicts well. 
E)  can only be presented in mathematical terms. 
A)  has realistic assumptions. 
B)  contains as much detail as possible. 
C)  cannot be proven false. 
D)  predicts well. 
E)  can only be presented in mathematical terms.

Question 7

An economist would classify 100 shares of the Apple Computers stock as capital.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following broad categories are resources divided into?

Accepted Answer

A)  People, money, and machines 
B)  Savings, spending, investment, and capital 
C)  Human, technological, and government 
D)  Natural resources, labor, capital, and entrepreneurial ability 
E)  Free, scarce, abundant, and unlimited 
A)  People, money, and machines 
B)  Savings, spending, investment, and capital 
C)  Human, technological, and government 
D)  Natural resources, labor, capital, and entrepreneurial ability 
E)  Free, scarce, abundant, and unlimited

Question 9

Economists tell stories:

Accepted Answer

A)  in order to breathe life into economic theory and personalize abstract ideas. 
B)  because economics is an art, not a science. 
C)  as a way of rigorously testing economic theory. 
D)  because doing so is a required part of the scientific method. 
E)  to show how their theory can predict at least one real-world situation. 
A)  in order to breathe life into economic theory and personalize abstract ideas. 
B)  because economics is an art, not a science. 
C)  as a way of rigorously testing economic theory. 
D)  because doing so is a required part of the scientific method. 
E)  to show how their theory can predict at least one real-world situation.

Question 10

Which of the following sentences is the best example of scarcity of time?

Accepted Answer

A)  Peter buys a hamburger. 
B)  John-Michael wants to spend his money on a new hoverboard. 
C)  Alexander is doing homework instead of going to the movies with his friends. 
D)  Amanda, a geography teacher, is retired. 
E)  Bill is unemployed. 
A)  Peter buys a hamburger. 
B)  John-Michael wants to spend his money on a new hoverboard. 
C)  Alexander is doing homework instead of going to the movies with his friends. 
D)  Amanda, a geography teacher, is retired. 
E)  Bill is unemployed.

Question 11

Which of the following statements regarding the basic economic problem of scarcity is correct?

Accepted Answer

A)  The problem only exists in countries that are not highly industrialized. 
B)  The problem is likely to disappear as production increases. 
C)  The problem is sure to disappear as technology improves. 
D)  The problem will exist as long as resources are available in limited amounts. 
E)  The problem will disappear as a person's income falls. 
A)  The problem only exists in countries that are not highly industrialized. 
B)  The problem is likely to disappear as production increases. 
C)  The problem is sure to disappear as technology improves. 
D)  The problem will exist as long as resources are available in limited amounts. 
E)  The problem will disappear as a person's income falls.

Question 12

Which of the following would be a topic considered in the field of macroeconomics?

Accepted Answer

A)  The study of the amazing recent growth of the Chinese economy 
B)  The study of the relocation of U.S. manufacturing firms to China 
C)  The study of the differences in wages between men and women in the United States 
D)  The study of the effect of rent control on the housing market in New York City 
E)  The study of the impact of environmental regulations on the well-being of human populations 
A)  The study of the amazing recent growth of the Chinese economy 
B)  The study of the relocation of U.S. manufacturing firms to China 
C)  The study of the differences in wages between men and women in the United States 
D)  The study of the effect of rent control on the housing market in New York City 
E)  The study of the impact of environmental regulations on the well-being of human populations

Question 13

Economics:

Accepted Answer

A)  studies human behavior when scarcity exists and choices must be made. 
B)  provides the only reasonable explanation of how people make decisions. 
C)  can accurately explain all human behavior since it is based on the assumption of rationality. 
D)  is better at showing the way things ought to be than the other social sciences. 
E)  is the only social science that can explain the existence and behavior of public institutions. 
A)  studies human behavior when scarcity exists and choices must be made. 
B)  provides the only reasonable explanation of how people make decisions. 
C)  can accurately explain all human behavior since it is based on the assumption of rationality. 
D)  is better at showing the way things ought to be than the other social sciences. 
E)  is the only social science that can explain the existence and behavior of public institutions.

Question 14

Profit is the payment received by resource owners for the use of their capital.

Accepted Answer

A) True 
 B)False

Question 15

The scientific method is useful:

Accepted Answer

A)  only in fields of science such as chemistry and physics. 
B)  for testing the validity of theoretical predictions. 
C)  for testing the validity of a model's assumptions. 
D)  when no economic variables can be assumed to be constant. 
E)  only if a theory has been proven to be true. 
A)  only in fields of science such as chemistry and physics. 
B)  for testing the validity of theoretical predictions. 
C)  for testing the validity of a model's assumptions. 
D)  when no economic variables can be assumed to be constant. 
E)  only if a theory has been proven to be true.

Question 16

Macroeconomics is the study of:

Accepted Answer

A)  the behavior of large firms in the marketplace. 
B)  the economic behavior of individual decision makers. 
C)  the behavior of the economy as a whole. 
D)  how to use the fewest natural resources to produce goods and services. 
E)  the government's role as a stabilizing influence on the economy. 
A)  the behavior of large firms in the marketplace. 
B)  the economic behavior of individual decision makers. 
C)  the behavior of the economy as a whole. 
D)  how to use the fewest natural resources to produce goods and services. 
E)  the government's role as a stabilizing influence on the economy.

Question 17

One problem with rent controls is that policy makers often ignore its secondary effects.

Accepted Answer

A) True 
 B)False

Question 18

Labor and capital are exchanged in the resource market.

Accepted Answer

A) True 
 B)False

Question 19

A good economic theory:

Accepted Answer

A)  approaches reality in all its complexity. 
B)  involves so much distortion of reality that it is worthless. 
C)  focuses on the unique aspects of each situation. 
D)  involves some simplification of reality. 
E)  bears no relation to reality. 
A)  approaches reality in all its complexity. 
B)  involves so much distortion of reality that it is worthless. 
C)  focuses on the unique aspects of each situation. 
D)  involves some simplification of reality. 
E)  bears no relation to reality.

Question 20

Households:

Accepted Answer

A)  own and sell resources. 
B)  play a very minor role in the economy. 
C)  supply goods and services. 
D)  are the largest purchasers of resources. 
E)  set the price for goods. 
A)  own and sell resources. 
B)  play a very minor role in the economy. 
C)  supply goods and services. 
D)  are the largest purchasers of resources. 
E)  set the price for goods.

Economics studies how decision makers use scarce resources to satisfy unlimited wants.

Economic theories are:

Economists generally believe that:

Benjamin works as an economist for the federal government. Which of the following questions is he trying to answer as part of his job?

Considering both product markets and resource markets, most economic decision makers participate in the economy as both buyers and sellers.

A good economic theory:

An economist would classify 100 shares of the Apple Computers stock as capital.

Which of the following broad categories are resources divided into?

Economists tell stories:

Which of the following sentences is the best example of scarcity of time?

Which of the following statements regarding the basic economic problem of scarcity is correct?

Which of the following would be a topic considered in the field of macroeconomics?

Economics:

Profit is the payment received by resource owners for the use of their capital.

The scientific method is useful:

Macroeconomics is the study of:

One problem with rent controls is that policy makers often ignore its secondary effects.

Labor and capital are exchanged in the resource market.

A good economic theory:

Households:

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

Economics studies how decision makers use scarce resources to satisfy unlimited wants.

Economic theories are:

Economists generally believe that:

Benjamin works as an economist for the federal government. Which of the following questions is he trying to answer as part of his job?

Considering both product markets and resource markets, most economic decision makers participate in the economy as both buyers and sellers.

A good economic theory:

An economist would classify 100 shares of the Apple Computers stock as capital.

Which of the following broad categories are resources divided into?

Economists tell stories:

Which of the following sentences is the best example of scarcity of time?

Which of the following statements regarding the basic economic problem of scarcity is correct?

Which of the following would be a topic considered in the field of macroeconomics?

Economics:

Profit is the payment received by resource owners for the use of their capital.

The scientific method is useful:

Macroeconomics is the study of:

One problem with rent controls is that policy makers often ignore its secondary effects.

Labor and capital are exchanged in the resource market.

A good economic theory:

Households:

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