Question 1

Trina's Tropical Fish Store sells goldfish for $2 each and angelfish for $10 each.The opportunity cost of buying a goldfish is:

Accepted Answer

A) 5 angelfish 
B) 1/5 of an angelfish 
C) $10 
D) $2 
A) 5 angelfish 
B) 1/5 of an angelfish 
C) $10 
D) $2

Question 2

'An increase in the price of petrol will increase the demand for hybrid vehicles.' This statement is an example of a positive economic statement.

Accepted Answer

A) True 
 B)False

Question 3

What is equity, and how does it differ from efficiency?
__________________________________________________________________________________________________________________________________________________________________________________________

Accepted Answer

Equity refers to the fair distribution o

Question 4

Optimal decisions are made at the point where marginal cost equals zero.

Accepted Answer

A) True 
 B)False

Question 5

A grocery store sells a bag of potatoes at a fixed price of $2.30.Which of the following is a term used by economists to describe the money received from the sale of an additional bag of potatoes?

Accepted Answer

A) Marginal revenue 
B) Gross earnings 
C) Pure profit 
D) Marginal costs 
A) Marginal revenue 
B) Gross earnings 
C) Pure profit 
D) Marginal costs

Question 6

Which of the following is not an example of an economic trade-off that a firm has to make?

Accepted Answer

A) Whether it is cheaper to produce with more machines or with more workers 
B) Whether it is cheaper to outsource the production of a good or service 
C) Whether or not consumers will buy its products 
D) Whether it should produce more of its product 
A) Whether it is cheaper to produce with more machines or with more workers 
B) Whether it is cheaper to outsource the production of a good or service 
C) Whether or not consumers will buy its products 
D) Whether it should produce more of its product

Question 7

If it costs Sinclair $300 to produce 3 suede jackets and $420 to produce 4 suede jackets, then the difference of $120 is the marginal cost of producing the 4th suede jacket.

Accepted Answer

A) True 
 B)False

Question 8

What type of relationship is the relationship between consumer spending and disposable personal income?

Accepted Answer

A) An inverse relationship 
B) A direct relationship 
C) A negative relationship 
D) Independent 
A) An inverse relationship 
B) A direct relationship 
C) A negative relationship 
D) Independent

Question 9

Positive analysis is concerned with 'what ought to be,' while normative analysis is concerned with 'what is.'

Accepted Answer

A) True 
 B)False

Question 10

Explain the economic assumption that 'people are rational.'
__________________________________________________________________________________________________________________________________________________________________________________________

Accepted Answer

'People are rational' means that economi

Question 11

The Coffee Nook, a small cafe near campus, sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each.What is the opportunity cost of buying a Russian tea cake?

Accepted Answer

A) 2 1/2 cappuccinos 
B) 2/5 of a cappuccino 
C) $2.50 
D) $1.00 
A) 2 1/2 cappuccinos 
B) 2/5 of a cappuccino 
C) $2.50 
D) $1.00

Question 12

The Coffee Nook, a small cafe near campus, sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each.What is the opportunity cost of buying a cappuccino?

Accepted Answer

A) 2 1/2 Russian tea cakes 
B) 2/5 of a Russian tea cake 
C) $2.50 
D) $1.00 
A) 2 1/2 Russian tea cakes 
B) 2/5 of a Russian tea cake 
C) $2.50 
D) $1.00

Question 13

In economics, choices must be made because we live in a world of:

Accepted Answer

A) unemployment. 
B) scarcity. 
C) greed. 
D) unlimited resources. 
A) unemployment. 
B) scarcity. 
C) greed. 
D) unlimited resources.

Question 14

In a centrally planned economy, the households and firms decide how economic resources will be allocated.

Accepted Answer

A) True 
 B)False

Question 15

How are the fundamental economic questions answered in a market economy?

Accepted Answer

A) The government alone decides the answers. 
B) Individuals, firms, and the government interact in markets to decide the answers to these questions. 
C) Households and firms interact in markets to decide the answers to these questions. 
D) Large corporations alone decide the answers. 
A) The government alone decides the answers. 
B) Individuals, firms, and the government interact in markets to decide the answers to these questions. 
C) Households and firms interact in markets to decide the answers to these questions. 
D) Large corporations alone decide the answers.

Question 16

The government makes all economic decisions in a market economy.

Accepted Answer

A) True 
 B)False

Question 17

Scarcity is a problem that will eventually disappear as technology advances.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following are primarily macroeconomic topics and which are primarily microeconomic topics?
a.petrol prices
b.unemployment
c.inflation
d.health care costs
e.air pollution
f.economic growth
__________________________________________________________________________________________________________________________________________________________________________________________

Accepted Answer

b, c, and f are prim

Question 19

Allison's Auto Art is a company that applies pinstripes to vehicles.Allison's cost for a basic 1-colour pinstriping job is $35, and she charges $95 for this service.For a total price of $175, Allison will apply a fancier 3-colour pinstripe application to an automobile, a service that adds an additional $40 to the total cost of the package.What is the marginal cost of moving up from the 1-colour application to the 3-colour application?

Accepted Answer

A) $35 
B) $40 
C) $80 
D) $175 
A) $35 
B) $40 
C) $80 
D) $175

Question 20

An economic ________ is a simplified version of some aspect of economic life used to analyse an economic issue.

Accepted Answer

A) market 
B) trade-off 
C) variable 
D) model 
A) market 
B) trade-off 
C) variable 
D) model

Trina's Tropical Fish Store sells goldfish for $2 each and angelfish for $10 each.The opportunity cost of buying a goldfish is:

'An increase in the price of petrol will increase the demand for hybrid vehicles.' This statement is an example of a positive economic statement.

What is equity, and how does it differ from efficiency? __________________________________________________________________________________________________________________________________________________________________________________________

Optimal decisions are made at the point where marginal cost equals zero.

A grocery store sells a bag of potatoes at a fixed price of $2.30.Which of the following is a term used by economists to describe the money received from the sale of an additional bag of potatoes?

Which of the following is not an example of an economic trade-off that a firm has to make?

If it costs Sinclair $300 to produce 3 suede jackets and $420 to produce 4 suede jackets, then the difference of $120 is the marginal cost of producing the 4th suede jacket.

What type of relationship is the relationship between consumer spending and disposable personal income?

Positive analysis is concerned with 'what ought to be,' while normative analysis is concerned with 'what is.'

Explain the economic assumption that 'people are rational.' __________________________________________________________________________________________________________________________________________________________________________________________

The Coffee Nook, a small cafe near campus, sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each.What is the opportunity cost of buying a Russian tea cake?

The Coffee Nook, a small cafe near campus, sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each.What is the opportunity cost of buying a cappuccino?

In economics, choices must be made because we live in a world of:

In a centrally planned economy, the households and firms decide how economic resources will be allocated.

How are the fundamental economic questions answered in a market economy?

The government makes all economic decisions in a market economy.

Scarcity is a problem that will eventually disappear as technology advances.

An economic ________ is a simplified version of some aspect of economic life used to analyse an economic issue.

Choices and Trade-Offs in the Market

Where Prices Come From: The Interaction of Demand and Supply

Elasticity: The Responsiveness of Demand and Supply

Economic Efficiency, Government Price Setting and Taxes

Consumer Choice and Behavioural Economics

Technology Production and Costs

Firms in Perfectly Competitive Markets

Monopoly Markets

Monopolistic Competition: The Competitive Model in a More Realistic

Oligopoly: Markets With Few Competitors

The Markets for Labour and Other Factors of Production

Comparative Advantage and the Gains From International Trade

Government Intervention in the Market

Externalities, Environmental Policy and Public Goods

The Distribution of Income and Social Policy

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Exam 1: Economics: Foundations and Models

Trina's Tropical Fish Store sells goldfish for $2 each and angelfish for $10 each.The opportunity cost of buying a goldfish is:

'An increase in the price of petrol will increase the demand for hybrid vehicles.' This statement is an example of a positive economic statement.

What is equity, and how does it differ from efficiency? __________________________________________________________________________________________________________________________________________________________________________________________

Optimal decisions are made at the point where marginal cost equals zero.

A grocery store sells a bag of potatoes at a fixed price of $2.30.Which of the following is a term used by economists to describe the money received from the sale of an additional bag of potatoes?

Which of the following is not an example of an economic trade-off that a firm has to make?

If it costs Sinclair $300 to produce 3 suede jackets and $420 to produce 4 suede jackets, then the difference of $120 is the marginal cost of producing the 4th suede jacket.

What type of relationship is the relationship between consumer spending and disposable personal income?

Positive analysis is concerned with 'what ought to be,' while normative analysis is concerned with 'what is.'

Explain the economic assumption that 'people are rational.' __________________________________________________________________________________________________________________________________________________________________________________________

The Coffee Nook, a small cafe near campus, sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each.What is the opportunity cost of buying a Russian tea cake?

The Coffee Nook, a small cafe near campus, sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each.What is the opportunity cost of buying a cappuccino?

In economics, choices must be made because we live in a world of:

In a centrally planned economy, the households and firms decide how economic resources will be allocated.

How are the fundamental economic questions answered in a market economy?

The government makes all economic decisions in a market economy.

Scarcity is a problem that will eventually disappear as technology advances.

An economic ________ is a simplified version of some aspect of economic life used to analyse an economic issue.

Choices and Trade-Offs in the Market

Where Prices Come From: The Interaction of Demand and Supply

Elasticity: The Responsiveness of Demand and Supply

Economic Efficiency, Government Price Setting and Taxes

Consumer Choice and Behavioural Economics

Technology Production and Costs

Firms in Perfectly Competitive Markets

Monopoly Markets

Monopolistic Competition: The Competitive Model in a More Realistic

Oligopoly: Markets With Few Competitors

The Markets for Labour and Other Factors of Production

Comparative Advantage and the Gains From International Trade

Government Intervention in the Market

Externalities, Environmental Policy and Public Goods

The Distribution of Income and Social Policy

Filters