Question 1

How does a tradeoff exist between a clean environment and a higher level of income?

Accepted Answer

A)  Studies show that individuals with higher levels of income purchase more environmentally friendly products than low-income individuals. 
B)  To pay for pollution cleanup, the government must increase taxes, which lowers income. 
C)  Laws that reduce pollution raise costs of production and reduce incomes. 
D)  By employing individuals to clean up pollution, employment and income both rise. 
A)  Studies show that individuals with higher levels of income purchase more environmentally friendly products than low-income individuals. 
B)  To pay for pollution cleanup, the government must increase taxes, which lowers income. 
C)  Laws that reduce pollution raise costs of production and reduce incomes. 
D)  By employing individuals to clean up pollution, employment and income both rise.

Question 2

When policymakers make policies that change the costs and benefits that people face, what is the result for society?

Accepted Answer

A)  people's behaviours are altered 
B)  people ignore incentives 
C)  inflation occurs 
D)  government revenue is reduced 
A)  people's behaviours are altered 
B)  people ignore incentives 
C)  inflation occurs 
D)  government revenue is reduced

Question 3

Which of these consumption activities will most likely impose an external cost?

Accepted Answer

A)  an executive plays a vigorous game of golf 
B)  a student in a dorm plays a YouTube video at 120 decibels late at night 
C)  a young mother exercises to a yoga video 
D)  a construction worker eats a sandwich during his lunch break 
A)  an executive plays a vigorous game of golf 
B)  a student in a dorm plays a YouTube video at 120 decibels late at night 
C)  a young mother exercises to a yoga video 
D)  a construction worker eats a sandwich during his lunch break

Question 4

Which statement is consistent with the tenth principle of economics?

Accepted Answer

A)  If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will temporarily fall. 
B)  If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will temporarily rise. 
C)  If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will permanently fall. 
D)  If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will permanently rise. 
A)  If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will temporarily fall. 
B)  If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will temporarily rise. 
C)  If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will permanently fall. 
D)  If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will permanently rise.

Question 5

What concept is illustrated by the adage, "There is no such thing as a free lunch"?

Accepted Answer

A)  tradeoffs 
B)  scarcity 
C)  productivity 
D)  efficiency 
A)  tradeoffs 
B)  scarcity 
C)  productivity 
D)  efficiency

Question 6

What is the definition of productivity?

Accepted Answer

A)  the amount of goods and services produced from each hour of a worker's time 
B)  the amount of labour that can be saved by replacing workers with machines 
C)  the actual amount of effort workers put into an hour of working time 
D)  the estimated amount of effort workers put into an hour of working time 
A)  the amount of goods and services produced from each hour of a worker's time 
B)  the amount of labour that can be saved by replacing workers with machines 
C)  the actual amount of effort workers put into an hour of working time 
D)  the estimated amount of effort workers put into an hour of working time

Question 7

Which of the following would NOT be a result of laws that require firms to reduce pollution?

Accepted Answer

A)  lower spending by government 
B)  higher prices to consumers 
C)  lower wages to workers 
D)  smaller profit to firms 
A)  lower spending by government 
B)  higher prices to consumers 
C)  lower wages to workers 
D)  smaller profit to firms

Question 8

How can trade benefit a family?

Accepted Answer

A)  by allowing the family to buy a greater variety of goods and services at a lower cost 
B)  by allowing each person to buy only the goods and services they want most 
C)  only if the family is not in economic competition with other families 
D)  trade can only benefit entire nations, not individuals 
A)  by allowing the family to buy a greater variety of goods and services at a lower cost 
B)  by allowing each person to buy only the goods and services they want most 
C)  only if the family is not in economic competition with other families 
D)  trade can only benefit entire nations, not individuals

Question 9

Mike has spent $500 purchasing and repairing an old fishing boat, which he expects to sell for $800. He discovers that he needs an additional repair, which will cost $600. He can sell the boat as it is now for $300. What should he do?

Accepted Answer

A)  He should take the $300. 
B)  He should never sell something for less than its cost. 
C)  He should complete the repairs and sell the boat. 
D)  It doesn't matter which action he takes; the outcome is the same either way. 
A)  He should take the $300. 
B)  He should never sell something for less than its cost. 
C)  He should complete the repairs and sell the boat. 
D)  It doesn't matter which action he takes; the outcome is the same either way.

Question 10

If education produces external benefits for society, what might NOT be an appropriate policy for society to establish regarding education?

Accepted Answer

A)  tax incentives for schooling 
B)  mandatory minimum levels of education 
C)  programs that promote the hiring of high school dropouts 
D)  free bussing to local high schools 
A)  tax incentives for schooling 
B)  mandatory minimum levels of education 
C)  programs that promote the hiring of high school dropouts 
D)  free bussing to local high schools

Question 11

What will pollution regulations do?

Accepted Answer

A)  increase profit to firms 
B)  impose a tradeoff on society 
C)  allow firms to raise workers' wages 
D)  lower prices for consumers 
A)  increase profit to firms 
B)  impose a tradeoff on society 
C)  allow firms to raise workers' wages 
D)  lower prices for consumers

Question 12

For society, when is a good NOT scarce?

Accepted Answer

A)  if at least one individual in society can obtain all he or she wants of the good 
B)  if firms are producing at full capacity 
C)  if all members of society can have all they want of the good 
D)  if those who have enough income can buy all they want of the good 
A)  if at least one individual in society can obtain all he or she wants of the good 
B)  if firms are producing at full capacity 
C)  if all members of society can have all they want of the good 
D)  if those who have enough income can buy all they want of the good

Question 13

Which of the following is an example of market power?

Accepted Answer

A)  a fast food restaurant in a university town 
B)  a wheat farmer in Saskatchewan 
C)  the only motel is in a remote Yukon town 
D)  a shoe store in Ontario 
A)  a fast food restaurant in a university town 
B)  a wheat farmer in Saskatchewan 
C)  the only motel is in a remote Yukon town 
D)  a shoe store in Ontario

Question 14

A marginal change is a small incremental adjustment to an existing plan of action.

Accepted Answer

A) True 
 B)False

Question 15

When the government attempts to improve equity in an economy, what is often the result?

Accepted Answer

A)  an increase in overall output in the economy 
B)  additional government revenue since overall income will increase 
C)  an actual reduction in equity 
D)  reduced efficiency in the economy 
A)  an increase in overall output in the economy 
B)  additional government revenue since overall income will increase 
C)  an actual reduction in equity 
D)  reduced efficiency in the economy

Question 16

In each of the following decision situations, show what tradeoffs are involved.
a) You are driving and need to decide how fast to drive.
b) You meet a young lady at a party and you are considering whether to ask her out.
c) You like a co-worker whom you have known for a couple of years, and you need to decide whether to go on a date with him.
d) You ponder moving back with your parents.
e) You need to decide whether to buy a used or a new car.
f) You are thinking about opening a computer services business in your basement.
g) You are a consultant for the City of Toronto. The city council asks you to analyze the implications of a new high-rise office building in downtown.

Accepted Answer

a)Driving faster gets you earlier to you

Question 17

How does a market economy reward people?

Accepted Answer

A)  according to their need for goods and services 
B)  according to their willingness to work 
C)  according to their ability to produce things that other people are willing to pay for 
D)  according to their ability to produce things of cultural importance 
A)  according to their need for goods and services 
B)  according to their willingness to work 
C)  according to their ability to produce things that other people are willing to pay for 
D)  according to their ability to produce things of cultural importance

Question 18

Your professor loves her work teaching economics. She has been offered other positions in the corporate world making 25 percent more, but has decided to stay in teaching. What might change her decision?

Accepted Answer

A)  if the marginal cost of teaching increased 
B)  if the marginal benefit of teaching increased 
C)  if the marginal cost of teaching decreased 
D)  if the marginal cost of a corporate job increased 
A)  if the marginal cost of teaching increased 
B)  if the marginal benefit of teaching increased 
C)  if the marginal cost of teaching decreased 
D)  if the marginal cost of a corporate job increased

Question 19

What will happen if a copper refinery does NOT bear the entire cost of the smoke it emits?

Accepted Answer

A)  It will not emit any smoke so as to avoid the entire cost of the smoke. 
B)  It will emit lower levels of smoke. 
C)  It will emit an acceptable level of smoke. 
D)  It will emit too much smoke. 
A)  It will not emit any smoke so as to avoid the entire cost of the smoke. 
B)  It will emit lower levels of smoke. 
C)  It will emit an acceptable level of smoke. 
D)  It will emit too much smoke.

Question 20

With the understanding that people respond to incentives, outline the possible outcome for teachers if the K-12 school year is extended to 11 months per year instead of the existing 10 months per year.

Accepted Answer

The concept of working longer per year w

How does a tradeoff exist between a clean environment and a higher level of income?

When policymakers make policies that change the costs and benefits that people face, what is the result for society?

Which of these consumption activities will most likely impose an external cost?

Which statement is consistent with the tenth principle of economics?

What concept is illustrated by the adage, "There is no such thing as a free lunch"?

What is the definition of productivity?

Which of the following would NOT be a result of laws that require firms to reduce pollution?

How can trade benefit a family?

Mike has spent $500 purchasing and repairing an old fishing boat, which he expects to sell for $800. He discovers that he needs an additional repair, which will cost $600. He can sell the boat as it is now for $300. What should he do?

If education produces external benefits for society, what might NOT be an appropriate policy for society to establish regarding education?

What will pollution regulations do?

For society, when is a good NOT scarce?

Which of the following is an example of market power?

A marginal change is a small incremental adjustment to an existing plan of action.

When the government attempts to improve equity in an economy, what is often the result?

How does a market economy reward people?

Your professor loves her work teaching economics. She has been offered other positions in the corporate world making 25 percent more, but has decided to stay in teaching. What might change her decision?

What will happen if a copper refinery does NOT bear the entire cost of the smoke it emits?

With the understanding that people respond to incentives, outline the possible outcome for teachers if the K-12 school year is extended to 11 months per year instead of the existing 10 months per year.

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Small Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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Exam 1: Ten Principles of Economics

How does a tradeoff exist between a clean environment and a higher level of income?

When policymakers make policies that change the costs and benefits that people face, what is the result for society?

Which of these consumption activities will most likely impose an external cost?

Which statement is consistent with the tenth principle of economics?

What concept is illustrated by the adage, "There is no such thing as a free lunch"?

What is the definition of productivity?

Which of the following would NOT be a result of laws that require firms to reduce pollution?

How can trade benefit a family?

Mike has spent $500 purchasing and repairing an old fishing boat, which he expects to sell for $800. He discovers that he needs an additional repair, which will cost $600. He can sell the boat as it is now for $300. What should he do?

If education produces external benefits for society, what might NOT be an appropriate policy for society to establish regarding education?

What will pollution regulations do?

For society, when is a good NOT scarce?

Which of the following is an example of market power?

A marginal change is a small incremental adjustment to an existing plan of action.

When the government attempts to improve equity in an economy, what is often the result?

How does a market economy reward people?

Your professor loves her work teaching economics. She has been offered other positions in the corporate world making 25 percent more, but has decided to stay in teaching. What might change her decision?

What will happen if a copper refinery does NOT bear the entire cost of the smoke it emits?

With the understanding that people respond to incentives, outline the possible outcome for teachers if the K-12 school year is extended to 11 months per year instead of the existing 10 months per year.

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Small Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

Filters