Question 1

Of the three major economic questions, which of the following is the best example of a "What? " question?

Accepted Answer

A) Should automobiles be produced using workers or robots? 
B) Should higher-income or lower-income people buy SUVs? 
C) Should we make faster microprocessors or pest-resistant corn? 
D) Should migrant workers or domestic workers be used to pick grapes? 
E) What should doctors be paid? 
A) Should automobiles be produced using workers or robots? 
B) Should higher-income or lower-income people buy SUVs? 
C) Should we make faster microprocessors or pest-resistant corn? 
D) Should migrant workers or domestic workers be used to pick grapes? 
E) What should doctors be paid?

Question 2

If x increases whenever y decreases, then x and y are

Accepted Answer

A) not related. 
B) positively related. 
C) directly related. 
D) negatively related. 
E) related but whether positively or negatively related depends on whether the x variable or the y variable is plotted on the vertical axis. 
A) not related. 
B) positively related. 
C) directly related. 
D) negatively related. 
E) related but whether positively or negatively related depends on whether the x variable or the y variable is plotted on the vertical axis.

Question 3

If there is a positive relationship between two variables,

Accepted Answer

A) the graph of the relationship will be upward sloping. 
B) the graph of the relationship will be downward sloping. 
C) the slope of the line graphing the relationship will be negative. 
D) Both answers A and C are correct. 
E) Both answers B and C are correct. 
A) the graph of the relationship will be upward sloping. 
B) the graph of the relationship will be downward sloping. 
C) the slope of the line graphing the relationship will be negative. 
D) Both answers A and C are correct. 
E) Both answers B and C are correct.

Question 4

Economics is the social science that studies

Accepted Answer

A) the real reasons people buy goods and services. 
B) the psychology of individuals and businesses. 
C) whether a nation has enough natural resources. 
D) how people make choices to cope with scarcity. 
E) how choices made in the social interest could eliminate scarcity. 
A) the real reasons people buy goods and services. 
B) the psychology of individuals and businesses. 
C) whether a nation has enough natural resources. 
D) how people make choices to cope with scarcity. 
E) how choices made in the social interest could eliminate scarcity.

Question 5

Which of the following statements best describes the study of economics? Economics studies how

Accepted Answer

A) to organize production so that scarcity does not occur. 
B) firms make profits. 
C) we make choices in the face of scarcity. 
D) to create incentives so that scarcity does not exist. 
E) businesses reach decisions. 
A) to organize production so that scarcity does not occur. 
B) firms make profits. 
C) we make choices in the face of scarcity. 
D) to create incentives so that scarcity does not exist. 
E) businesses reach decisions.

Question 6

-A graph of the relationship between two variables is a line that slopes down to the right. These two variables are ________ related.

Accepted Answer

A) positively 
B) directly 
C) negatively 
D) not 
E) trend-line 
A) positively 
B) directly 
C) negatively 
D) not 
E) trend-line

Question 7

When two variables in a graph are related to a third, changing the third causes

Accepted Answer

A) a movement along the curve. 
B) a shift of the curve. 
C) no change in the curve because the third variable isn't on the axes. 
D) either a shift or a movement in the curve but more information is needed to determine which occurs. 
E) None of the above answers is correct. 
A) a movement along the curve. 
B) a shift of the curve. 
C) no change in the curve because the third variable isn't on the axes. 
D) either a shift or a movement in the curve but more information is needed to determine which occurs. 
E) None of the above answers is correct.

Question 8

Suppose the relationship between a person's age and his or her height is plotted with the age measured along the x-axis and the height measured along the y-axis. Then, the curve showing this relationship is

Accepted Answer

A) a straight line with a positive slope. 
B) positively sloped and becoming less steep. 
C) a straight line with a negative slope. 
D) negatively sloped and becoming less steep. 
E) positively sloped and becoming more steep. 
A) a straight line with a positive slope. 
B) positively sloped and becoming less steep. 
C) a straight line with a negative slope. 
D) negatively sloped and becoming less steep. 
E) positively sloped and becoming more steep.

Question 9

With y measured on the vertical axis and x measured on the horizontal axis, the slope of a straight line is defined as

Accepted Answer

A) y/x. 
B) x/y. 
C) (change in y)/(change in x). 
D) (change in x)/(change in y). 
E) y - x. 
A) y/x. 
B) x/y. 
C) (change in y)/(change in x). 
D) (change in x)/(change in y). 
E) y - x.

Question 10

John has two hours of free time this evening. He ranked his alternatives, first go to a concert, second go to a movie, third study for an economics exam, and fourth answer his e-mail. What is the opportunity cost of attending the concert for John?

Accepted Answer

A) attending a movie 
B) studying for an economics exam 
C) answering his e-mail 
D) attending a movie, studying for an economics exam, and answering his e-mail 
E) going to the concert because that is what John chose to do. 
A) attending a movie 
B) studying for an economics exam 
C) answering his e-mail 
D) attending a movie, studying for an economics exam, and answering his e-mail 
E) going to the concert because that is what John chose to do.

Question 11

Three variables are related and two of them are plotted in a figure. If the variable that is not measured on either the x-axis or the y-axis changes, then there is

Accepted Answer

A) a movement along the drawn curve. 
B) a shift in the curve. 
C) no impact on the curve because the variable is not measured on either of the axes. 
D) either a shift in the curve or a movement along the curve, but more information is needed to determine which. 
E) None of the above answers is correct. 
A) a movement along the drawn curve. 
B) a shift in the curve. 
C) no impact on the curve because the variable is not measured on either of the axes. 
D) either a shift in the curve or a movement along the curve, but more information is needed to determine which. 
E) None of the above answers is correct.

Question 12

Two economists can agree that raising the minimum wage creates unemployment yet one might argue that raising the minimum wage is a good policy and the other that it is a bad policy. Why can this difference exist?
 Be sure to use the terms positive and normative in your answer.

Accepted Answer

Positive statements are statements that

Question 13

If whenever one variable increases, another variable also increases, then these two variables are ________ related.

Accepted Answer

A) positively 
B) negatively 
C) inversely 
D) cross-sectionally 
E) trend-line 
A) positively 
B) negatively 
C) inversely 
D) cross-sectionally 
E) trend-line

Question 14

Whenever people's incomes increase, they buy more guitars. Hence a scatter diagram shows that the relationship between income and guitars purchased is

Accepted Answer

A) a positive relationship. 
B) a linear relationship. 
C) a negative relationship. 
D) some sort of relationship, but whether it is positive or negative depends on whether income is plotted on the vertical or horizontal axis. 
E) a U-shaped relationship. 
A) a positive relationship. 
B) a linear relationship. 
C) a negative relationship. 
D) some sort of relationship, but whether it is positive or negative depends on whether income is plotted on the vertical or horizontal axis. 
E) a U-shaped relationship.

Question 15

Which type of graph is most useful in determining if two variables are correlated?

Accepted Answer

A) time-series 
B) scatter diagram 
C) cross-section 
D) variable-correlation figure 
E) None of the above answers is correct. 
A) time-series 
B) scatter diagram 
C) cross-section 
D) variable-correlation figure 
E) None of the above answers is correct.

Question 16

Which type of economic graph reveals trends in data?

Accepted Answer

A) cross-section graph 
B) time-series graph 
C) scatter diagram 
D) Answers A and C are correct. 
E) Answers A, B, and C are all correct. 
A) cross-section graph 
B) time-series graph 
C) scatter diagram 
D) Answers A and C are correct. 
E) Answers A, B, and C are all correct.

Question 17

The statement that "increases in the tax on gasoline increase the price of gasoline" is an example of a

Accepted Answer

A) normative statement. 
B) positive statement. 
C) macroeconomic statement. 
D) rational-decision statement. 
E) marginal statement. 
A) normative statement. 
B) positive statement. 
C) macroeconomic statement. 
D) rational-decision statement. 
E) marginal statement.

Question 18

Whether a company produces fishing rods mostly by hand or using high-tech machinery is a question of

Accepted Answer

A) for whom will goods be produced. 
B) when will the goods be produced. 
C) where will the goods be produced. 
D) how will the goods be produced. 
E) why will the goods be produced. 
A) for whom will goods be produced. 
B) when will the goods be produced. 
C) where will the goods be produced. 
D) how will the goods be produced. 
E) why will the goods be produced.

Question 19

The value of the best thing that a person must give up when making a decision is known as the ________ cost.

Accepted Answer

A) direct 
B) benefit's 
C) opportunity 
D) explicit 
E) sunk 
A) direct 
B) benefit's 
C) opportunity 
D) explicit 
E) sunk

Question 20

The vertical axis in a graph

Accepted Answer

A) is named the y-axis. 
B) is named the x-axis. 
C) measures time in a cross-section and time series graph. 
D) has no origin. 
E) measures time only in a time series graph. 
A) is named the y-axis. 
B) is named the x-axis. 
C) measures time in a cross-section and time series graph. 
D) has no origin. 
E) measures time only in a time series graph.

Of the three major economic questions, which of the following is the best example of a "What? " question?

If x increases whenever y decreases, then x and y are

If there is a positive relationship between two variables,

Economics is the social science that studies

Which of the following statements best describes the study of economics? Economics studies how

-A graph of the relationship between two variables is a line that slopes down to the right. These two variables are ________ related.

When two variables in a graph are related to a third, changing the third causes

Suppose the relationship between a person's age and his or her height is plotted with the age measured along the x-axis and the height measured along the y-axis. Then, the curve showing this relationship is

With y measured on the vertical axis and x measured on the horizontal axis, the slope of a straight line is defined as

John has two hours of free time this evening. He ranked his alternatives, first go to a concert, second go to a movie, third study for an economics exam, and fourth answer his e-mail. What is the opportunity cost of attending the concert for John?

Three variables are related and two of them are plotted in a figure. If the variable that is not measured on either the x-axis or the y-axis changes, then there is

Two economists can agree that raising the minimum wage creates unemployment yet one might argue that raising the minimum wage is a good policy and the other that it is a bad policy. Why can this difference exist? Be sure to use the terms positive and normative in your answer.

If whenever one variable increases, another variable also increases, then these two variables are ________ related.

Whenever people's incomes increase, they buy more guitars. Hence a scatter diagram shows that the relationship between income and guitars purchased is

Which type of graph is most useful in determining if two variables are correlated?

Which type of economic graph reveals trends in data?

The statement that "increases in the tax on gasoline increase the price of gasoline" is an example of a

Whether a company produces fishing rods mostly by hand or using high-tech machinery is a question of

The value of the best thing that a person must give up when making a decision is known as the ________ cost.

The vertical axis in a graph

The Us and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, Education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 1: Getting Started

Of the three major economic questions, which of the following is the best example of a "What? " question?

If x increases whenever y decreases, then x and y are

If there is a positive relationship between two variables,

Economics is the social science that studies

Which of the following statements best describes the study of economics? Economics studies how

-A graph of the relationship between two variables is a line that slopes down to the right. These two variables are ________ related.

When two variables in a graph are related to a third, changing the third causes

Suppose the relationship between a person's age and his or her height is plotted with the age measured along the x-axis and the height measured along the y-axis. Then, the curve showing this relationship is

With y measured on the vertical axis and x measured on the horizontal axis, the slope of a straight line is defined as

John has two hours of free time this evening. He ranked his alternatives, first go to a concert, second go to a movie, third study for an economics exam, and fourth answer his e-mail. What is the opportunity cost of attending the concert for John?

Three variables are related and two of them are plotted in a figure. If the variable that is not measured on either the x-axis or the y-axis changes, then there is

Two economists can agree that raising the minimum wage creates unemployment yet one might argue that raising the minimum wage is a good policy and the other that it is a bad policy. Why can this difference exist? Be sure to use the terms positive and normative in your answer.

If whenever one variable increases, another variable also increases, then these two variables are ________ related.

Whenever people's incomes increase, they buy more guitars. Hence a scatter diagram shows that the relationship between income and guitars purchased is

Which type of graph is most useful in determining if two variables are correlated?

Which type of economic graph reveals trends in data?

The statement that "increases in the tax on gasoline increase the price of gasoline" is an example of a

Whether a company produces fishing rods mostly by hand or using high-tech machinery is a question of

The value of the best thing that a person must give up when making a decision is known as the ________ cost.

The vertical axis in a graph

The Us and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, Education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters