Question 1

Scarcity is a situation in which resources are unlimited in quantity and can be used in different ways.

Accepted Answer

A) True 
 B)False

Question 2

Recall the Application about the increase in purchases of hybrid vehicles to answer the following question(s).
-According to the Application, one factor which was responsible for roughly one-fifth of hybrid vehicles purchased in 2007 was a federal subsidy of up to $3,400 per hybrid vehicle. The increase in sales due to this subsidy is an example of which element of the economic way of thinking?

Accepted Answer

A)  responding to incentives 
B)  thinking at the margin 
C)  isolating variables 
D)  using assumptions to simplify 
A)  responding to incentives 
B)  thinking at the margin 
C)  isolating variables 
D)  using assumptions to simplify

Question 3

Negative relationships are also referred to as inverse relationships.

Accepted Answer

A) True 
 B)False

Question 4

Because resources are limited

Accepted Answer

A)  only the very wealthy can get everything they want. 
B)  firms will be forced out of business. 
C)  the availability of goods will be limited but the availability of services will not. 
D)  people must make choices. 
A)  only the very wealthy can get everything they want. 
B)  firms will be forced out of business. 
C)  the availability of goods will be limited but the availability of services will not. 
D)  people must make choices.

Question 5

Figure 1A.1
-Refer to Figure 1A.1. The slope of the line between the points where income equals 50 and income equals 200 is

Accepted Answer

A)  0.2. 
B)  5. 
C)  10. 
D)  50. 
A)  0.2. 
B)  5. 
C)  10. 
D)  50.

Question 6

The physical and mental effort people use to produce goods and services is a description of which factor of production?

Accepted Answer

A)  physical capital 
B)  human capital 
C)  labor 
D)  entrepreneurship 
A)  physical capital 
B)  human capital 
C)  labor 
D)  entrepreneurship

Question 7

A key assumption of most economic analysis is that people are altruistic, meaning that they act in their own self-interest.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is a macroeconomic question?

Accepted Answer

A)  Should we have a constitutional amendment requiring the government to implement a national consumption tax to replace the current income tax? 
B)  Why did a leading computer manufacturer establish call centers in India? 
C)  Why does a pharmaceutical manufacturer try to lower its production costs? 
D)  Should the government put a tax on alcohol in an attempt to assist in the funding of support groups like Alcoholics Anonymous? 
A)  Should we have a constitutional amendment requiring the government to implement a national consumption tax to replace the current income tax? 
B)  Why did a leading computer manufacturer establish call centers in India? 
C)  Why does a pharmaceutical manufacturer try to lower its production costs? 
D)  Should the government put a tax on alcohol in an attempt to assist in the funding of support groups like Alcoholics Anonymous?

Question 9

Macroeconomics is best described as the study of

Accepted Answer

A)  very large issues. 
B)  the choices made by individual households, firms, and governments. 
C)  the nation's economy as a whole. 
D)  the relationship between inflation and wage inequality. 
A)  very large issues. 
B)  the choices made by individual households, firms, and governments. 
C)  the nation's economy as a whole. 
D)  the relationship between inflation and wage inequality.

Question 10

Give an example of something that is scarce in your life and explain the choices you've made because of scarcity.

Accepted Answer

Responses

Question 11

Ceteris paribus is the same as rise / run.

Accepted Answer

A) True 
 B)False

Question 12

Economists will always reach the same conclusion in their positive analyses.

Accepted Answer

A) True 
 B)False

Question 13

The congestion tax implemented in London reduced traffic volume and cut travel time for cars and buses in half.

Accepted Answer

A) True 
 B)False

Question 14

Microeconomics helps explain economic fluctuations, why the economy shrinks and expands and why some of the economy's resources are idle.

Accepted Answer

A) True 
 B)False

Question 15

Recall the Application about the increase in purchases of hybrid vehicles to answer the following question(s).
-According to the Application, one factor which was responsible for roughly one-third of hybrid vehicles purchased in 2007 was an increase in the price of gasoline. The increase in sales due to higher gasoline prices describes the economic concept of

Accepted Answer

A)  using assumptions to simplify. 
B)  ceteris paribus. 
C)  marginal thinking. 
D)  rational self interest. 
A)  using assumptions to simplify. 
B)  ceteris paribus. 
C)  marginal thinking. 
D)  rational self interest.

Question 16

An economic model is a detailed version of an economic environment.

Accepted Answer

A) True 
 B)False

Question 17

A small change in a variable is

Accepted Answer

A)  an average change. 
B)  a ceteris paribus change. 
C)  an efficient change. 
D)  a marginal change. 
A)  an average change. 
B)  a ceteris paribus change. 
C)  an efficient change. 
D)  a marginal change.

Question 18

One of the key economic questions is "where should products be produced?"

Accepted Answer

A) True 
 B)False

Question 19

A variable measures

Accepted Answer

A)  something that always has the same value. 
B)  something that can take on different values. 
C)  factors that occur with high degrees of uncertainty. 
D)  the degree to which something varies over time. 
A)  something that always has the same value. 
B)  something that can take on different values. 
C)  factors that occur with high degrees of uncertainty. 
D)  the degree to which something varies over time.

Question 20

Normative economics

Accepted Answer

A)  is the focus of most modern economic reasoning. 
B)  answers the question "What ought to be?" 
C)  predicts the consequences of alternative actions. 
D)  answers the question "What is?" 
A)  is the focus of most modern economic reasoning. 
B)  answers the question "What ought to be?" 
C)  predicts the consequences of alternative actions. 
D)  answers the question "What is?"

Scarcity is a situation in which resources are unlimited in quantity and can be used in different ways.

Negative relationships are also referred to as inverse relationships.

Because resources are limited

Figure 1A.1 -Refer to Figure 1A.1. The slope of the line between the points where income equals 50 and income equals 200 is

The physical and mental effort people use to produce goods and services is a description of which factor of production?

A key assumption of most economic analysis is that people are altruistic, meaning that they act in their own self-interest.

Which of the following is a macroeconomic question?

Macroeconomics is best described as the study of

Give an example of something that is scarce in your life and explain the choices you've made because of scarcity.

Ceteris paribus is the same as rise / run.

Economists will always reach the same conclusion in their positive analyses.

The congestion tax implemented in London reduced traffic volume and cut travel time for cars and buses in half.

Microeconomics helps explain economic fluctuations, why the economy shrinks and expands and why some of the economy's resources are idle.

An economic model is a detailed version of an economic environment.

A small change in a variable is

One of the key economic questions is "where should products be produced?"

A variable measures

Normative economics

The Key Principles of Economics

Demand, Supply, and Market Equilibrium

Elasticity: A Measure of Responsiveness

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry, Monopolistic Competition, and Oligopoly

Imperfect Information, External Benefits, and External Costs

The Labor Market and the Distribution of Income

Measuring a Nations Production and Income

Unemployment and Inflation

Why Do Economies Grow

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money and the Banking System

Monetary Policy and Inflation

International Trade and Finance

Filters

Exam 1: Introduction: What Is Economics

Scarcity is a situation in which resources are unlimited in quantity and can be used in different ways.

Negative relationships are also referred to as inverse relationships.

Because resources are limited

Figure 1A.1 -Refer to Figure 1A.1. The slope of the line between the points where income equals 50 and income equals 200 is

The physical and mental effort people use to produce goods and services is a description of which factor of production?

A key assumption of most economic analysis is that people are altruistic, meaning that they act in their own self-interest.

Which of the following is a macroeconomic question?

Macroeconomics is best described as the study of

Give an example of something that is scarce in your life and explain the choices you've made because of scarcity.

Ceteris paribus is the same as rise / run.

Economists will always reach the same conclusion in their positive analyses.

The congestion tax implemented in London reduced traffic volume and cut travel time for cars and buses in half.

Microeconomics helps explain economic fluctuations, why the economy shrinks and expands and why some of the economy's resources are idle.

An economic model is a detailed version of an economic environment.

A small change in a variable is

One of the key economic questions is "where should products be produced?"

A variable measures

Normative economics

The Key Principles of Economics

Demand, Supply, and Market Equilibrium

Elasticity: A Measure of Responsiveness

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry, Monopolistic Competition, and Oligopoly

Imperfect Information, External Benefits, and External Costs

The Labor Market and the Distribution of Income

Measuring a Nations Production and Income

Unemployment and Inflation

Why Do Economies Grow

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money and the Banking System

Monetary Policy and Inflation

International Trade and Finance

Filters