Question 1

By definition,economics is the study of

Accepted Answer

A) how to make money in the stock market. 
B) how to make money in a market economy. 
C) the choices people make to attain their goals, given their scarce resources. 
D) supply and demand. 
A) how to make money in the stock market. 
B) how to make money in a market economy. 
C) the choices people make to attain their goals, given their scarce resources. 
D) supply and demand.

Question 2

The government makes all economic decisions in a mixed economy.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is a positive economic statement?

Accepted Answer

A) Everyone should live at the same standard of living. 
B) If the price of gasoline rises, a smaller quantity of it will be bought. 
C) The government should close income tax loopholes. 
D) U)S.firms should not be allowed to outsource production of goods and services. 
A) Everyone should live at the same standard of living. 
B) If the price of gasoline rises, a smaller quantity of it will be bought. 
C) The government should close income tax loopholes. 
D) U)S.firms should not be allowed to outsource production of goods and services.

Question 4

Which of the following statements about the economic decisions consumers,firms,and the government have to make is false?

Accepted Answer

A) Governments face the problem of scarcity in making economic decisions. 
B) Only individuals face scarcity; firms and the government do not. 
C) Both firms and individuals face scarcity. 
D) Each faces the problem of scarcity which necessitates trade-offs in making economic decisions. 
A) Governments face the problem of scarcity in making economic decisions. 
B) Only individuals face scarcity; firms and the government do not. 
C) Both firms and individuals face scarcity. 
D) Each faces the problem of scarcity which necessitates trade-offs in making economic decisions.

Question 5

Suppose a doctor can earn an additional $25,000 in revenue per year by keeping her office open on Sundays.At what additional cost would keeping the office open on Sundays not be considered economically rational?

Accepted Answer

If the additional cost of keep

Question 6

If the marginal cost of keeping a doctor's office open one additional hour per day is $200,then the doctor should keep the office open for one extra hour

Accepted Answer

A) only if the marginal benefit she receives is greater than $200 plus an acceptable profit margin. 
B) as long as the marginal benefit she receives is just equal to or greater than $200. 
C) as long as the marginal cost does not rise. 
D) until the marginal benefit she receives reaches zero. 
A) only if the marginal benefit she receives is greater than $200 plus an acceptable profit margin. 
B) as long as the marginal benefit she receives is just equal to or greater than $200. 
C) as long as the marginal cost does not rise. 
D) until the marginal benefit she receives reaches zero.

Question 7

Figure 1-5
  
-Refer to Figure 1-5.Calculate the area of the triangle A.

Accepted Answer

A) $8.4 million 
B) $6.3 million 
C) $3.15 million 
D) $2.1 million 
A) $8.4 million 
B) $6.3 million 
C) $3.15 million 
D) $2.1 million

Question 8

Human capital refers to

Accepted Answer

A) the money people have. 
B) the machines workers have to work with. 
C) the accumulated skills and training workers have. 
D) the wealth people have. 
A) the money people have. 
B) the machines workers have to work with. 
C) the accumulated skills and training workers have. 
D) the wealth people have.

Question 9

"The distribution of income should be determined by the government" is an example of a positive economic statement.

Accepted Answer

A) True 
 B)False

Question 10

Consumers and make all economic decisions in a mixed economy.

Accepted Answer

A) True 
 B)False

Question 11

Table 1-4
 $$\begin{array} { | c | c | } 
\hline \begin{array} { c } 
\text { Hours } \
\text { Open }
\end{array} & \begin{array} { c } 
\text { Total } \
\text { Revenue } \
\text { (dollars) }
\end{array} \
\hline 1 & \$ 35 \
\hline 2 & 60 \
\hline 3 & 80 \
\hline 4 & 92 \
\hline 5 & 100 \
\hline 6 & 105 \
\hline
\end{array}$$ 
Eva runs a small bakery in the village of Roggerli.She is debating whether she should extend her hours of operation.Eva figures that her sales revenue will depend on the number of hours the bakery is open as shown in the table above.She would have to hire a worker for those hours at a wage rate of $12 per hour.
-Refer to Table 1-4.Using marginal analysis,determine how many hours should Eva extend her bakery's hours of operations?

Accepted Answer

A) 2 hours 
B) 3 hours 
C) 4 hours 
D) 5 hours 
E) 6 hours 
A) 2 hours 
B) 3 hours 
C) 4 hours 
D) 5 hours 
E) 6 hours

Question 12

Which of the following is an example of an activity undertaken by an entrepreneur?

Accepted Answer

A) choosing the color scheme for your renovated kitchen 
B) being promoted to the position of Chief of Police 
C) being appointed to the U.S.Supreme Court 
D) starting your own snow cone business 
A) choosing the color scheme for your renovated kitchen 
B) being promoted to the position of Chief of Police 
C) being appointed to the U.S.Supreme Court 
D) starting your own snow cone business

Question 13

Which of the following contributes to the efficiency of markets?

Accepted Answer

A) Governments play an active role in the day-to-day operations of markets. 
B) Markets are able to bring about an equitable distribution of goods and services. 
C) Markets promote equal standards of living. 
D) Markets promote competition and voluntary exchange. 
A) Governments play an active role in the day-to-day operations of markets. 
B) Markets are able to bring about an equitable distribution of goods and services. 
C) Markets promote equal standards of living. 
D) Markets promote competition and voluntary exchange.

Question 14

Table 1-6
 $$\begin{array} { | c | c | } 
\hline \begin{array} { c } 
\text { Hours } \
\text { Open }
\end{array} & \begin{array} { c } 
\text { Tatal } \
\text { Revenue } \
\text { (dallars) }
\end{array} \
\hline 1 & \$ 275 \
\hline 2 & 375 \
\hline 3 & 450 \
\hline 4 & 500 \
\hline 5 & 530 \
\hline 6 & 550 \
\hline
\end{array}$$ 
Ivan runs a custom jewelry shop in Sparkle City.He is debating whether he should extend his hours of operation.Ivan figures that his sales revenue will depend on the number of hours the jewelry shop is open as shown in the table above.He would have to hire a worker for those hours at a wage rate of $25 per hour.
-Refer to Table 1-6.Using marginal analysis,determine how many hours should Ivan extend his hours of operations?

Accepted Answer

A) 2 hours 
B) 3 hours 
C) 4 hours 
D) 5 hours 
E) 6 hours 
A) 2 hours 
B) 3 hours 
C) 4 hours 
D) 5 hours 
E) 6 hours

Question 15

Which of the following is a microeconomics question?

Accepted Answer

A) Why do economies experience periods of recession? 
B) Will government intervention lower the unemployment rate? 
C) Why has growth in the economy slowed down over the past decade? 
D) How will Apple decide on a selling price for the iPad? 
A) Why do economies experience periods of recession? 
B) Will government intervention lower the unemployment rate? 
C) Why has growth in the economy slowed down over the past decade? 
D) How will Apple decide on a selling price for the iPad?

Question 16

Which of the following are positive economic statements and which are normative economic statements?
a.An increase in the minimum wage causes unemployment.
b.The government should raise the minimum wage above $7.25 per hour.
c.The prolonged recession has caused the unemployment rate to reach a 30-year high.
d.Interest rates need to be lower for the economy to emerge from the recession.
e.Inflation has decreased since the onset of the recession.
f.Once the recession has ended,interest rates should increased to assure that inflation does not go up.

Accepted Answer

Statements a,c,and e are posit

Question 17

Which of the following is a normative economic statement?

Accepted Answer

A) Rising corn prices have increased the price of corn-based ethanol. 
B) With rising home prices and falling mortgage interest rates, the amount of home foreclosures has decreased. 
C) The federal government is considering increasing regulations on the use of fossil fuels to promote the use of wind power. 
D) Farmers should not be allowed to grow and sell genetically-modified crops. 
A) Rising corn prices have increased the price of corn-based ethanol. 
B) With rising home prices and falling mortgage interest rates, the amount of home foreclosures has decreased. 
C) The federal government is considering increasing regulations on the use of fossil fuels to promote the use of wind power. 
D) Farmers should not be allowed to grow and sell genetically-modified crops.

Question 18

Describe what has happened to state obesity rates in the United States since 1994.

Accepted Answer

There has been a dramatic increase in ob

Question 19

Table 1-4
 $$\begin{array} { | c | c | } 
\hline \begin{array} { c } 
\text { Hours } \
\text { Open }
\end{array} & \begin{array} { c } 
\text { Total } \
\text { Revenue } \
\text { (dollars) }
\end{array} \
\hline 1 & \$ 35 \
\hline 2 & 60 \
\hline 3 & 80 \
\hline 4 & 92 \
\hline 5 & 100 \
\hline 6 & 105 \
\hline
\end{array}$$ 
Eva runs a small bakery in the village of Roggerli.She is debating whether she should extend her hours of operation.Eva figures that her sales revenue will depend on the number of hours the bakery is open as shown in the table above.She would have to hire a worker for those hours at a wage rate of $12 per hour.
-Refer to Table 1-4.What is Eva's marginal benefit if she decides to stay open for two hours instead of one hour?

Accepted Answer

A) $25 
B) $36 
C) $60 
D) $95 
A) $25 
B) $36 
C) $60 
D) $95

Question 20

What is the difference between accounting profit and economic profit?

Accepted Answer

Profit is the difference between revenue

By definition,economics is the study of

The government makes all economic decisions in a mixed economy.

Which of the following is a positive economic statement?

Which of the following statements about the economic decisions consumers,firms,and the government have to make is false?

Suppose a doctor can earn an additional $25,000 in revenue per year by keeping her office open on Sundays.At what additional cost would keeping the office open on Sundays not be considered economically rational?

If the marginal cost of keeping a doctor's office open one additional hour per day is $200,then the doctor should keep the office open for one extra hour

Figure 1-5 -Refer to Figure 1-5.Calculate the area of the triangle A.

Human capital refers to

"The distribution of income should be determined by the government" is an example of a positive economic statement.

Consumers and make all economic decisions in a mixed economy.

Which of the following is an example of an activity undertaken by an entrepreneur?

Which of the following contributes to the efficiency of markets?

Which of the following is a microeconomics question?

Which of the following is a normative economic statement?

Describe what has happened to state obesity rates in the United States since 1994.

What is the difference between accounting profit and economic profit?

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

Exam 1: Economics: Foundations and Models

By definition,economics is the study of

The government makes all economic decisions in a mixed economy.

Which of the following is a positive economic statement?

Which of the following statements about the economic decisions consumers,firms,and the government have to make is false?

Suppose a doctor can earn an additional $25,000 in revenue per year by keeping her office open on Sundays.At what additional cost would keeping the office open on Sundays not be considered economically rational?

If the marginal cost of keeping a doctor's office open one additional hour per day is $200,then the doctor should keep the office open for one extra hour

Figure 1-5 -Refer to Figure 1-5.Calculate the area of the triangle A.

Human capital refers to

"The distribution of income should be determined by the government" is an example of a positive economic statement.

Consumers and make all economic decisions in a mixed economy.

Which of the following is an example of an activity undertaken by an entrepreneur?

Which of the following contributes to the efficiency of markets?

Which of the following is a microeconomics question?

Which of the following is a normative economic statement?

Describe what has happened to state obesity rates in the United States since 1994.

What is the difference between accounting profit and economic profit?

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters