Question 1

Economic analysis that is concerned with both facts and ethical standards is called _______.

Accepted Answer

A)  positive economics. 
B)  normative economics. 
C)  econometrics. 
D)  welfare economics. 
E)  ceteris paribus. 
A)  positive economics. 
B)  normative economics. 
C)  econometrics. 
D)  welfare economics. 
E)  ceteris paribus.

Question 2

You have just purchased a car for $20,000 and realized that you still have to pay for insurance,licence,parking and gasoline.The $20,000 spent on the car represents

Accepted Answer

A)  sunk cost. 
B)  opportunity cost. 
C)  marginal cost. 
D)  average cost. 
E)  total costs. 
A)  sunk cost. 
B)  opportunity cost. 
C)  marginal cost. 
D)  average cost. 
E)  total costs.

Question 3

Applying the cost-benefit principle to the issues of large class sizes and recent tuition hikes in Canadian universities and colleges will help to find

Accepted Answer

A)  a fair solution to the problems of such increases. 
B)  the best solution to the problems of such increases. 
C)  a plausible explanation of the problems of such increases. 
D)  out who could best bear the full burden of such increases. 
E)  out whether the government is doing their best to avert the problems of such increases. 
A)  a fair solution to the problems of such increases. 
B)  the best solution to the problems of such increases. 
C)  a plausible explanation of the problems of such increases. 
D)  out who could best bear the full burden of such increases. 
E)  out whether the government is doing their best to avert the problems of such increases.

Question 4

The average benefit of an activity is the

Accepted Answer

A)  total benefit of the activity times the number of units. 
B)  total benefit of the activity divided by the number of units. 
C)  number of units divided by the total benefit of the activity. 
D)  number of units times the total benefit of the activity. 
E)  reciprocal of the total benefits of the activity. 
A)  total benefit of the activity times the number of units. 
B)  total benefit of the activity divided by the number of units. 
C)  number of units divided by the total benefit of the activity. 
D)  number of units times the total benefit of the activity. 
E)  reciprocal of the total benefits of the activity.

Question 5

The branch of economics that involves the application of statistical techniques to economic data is

Accepted Answer

A)  macroeconomics. 
B)  microeconomics. 
C)  positive economics. 
D)  welfare economics. 
E)  econometrics. 
A)  macroeconomics. 
B)  microeconomics. 
C)  positive economics. 
D)  welfare economics. 
E)  econometrics.

Question 6

You started a new business and your twin sister helped you out for free while she turned down a project that would have paid her a total of $200.When calculating the costs involved in starting up the new business,you should

Accepted Answer

A)  not include $200 since you did not have to pay your sister. 
B)  include $200 as the sunk cost. 
C)  include $200 as an average weekly cost since this is what your sister might have received. 
D)  include $200 as the opportunity cost of your sister's labour. 
E)  not include your sister's labour since she is family. 
A)  not include $200 since you did not have to pay your sister. 
B)  include $200 as the sunk cost. 
C)  include $200 as an average weekly cost since this is what your sister might have received. 
D)  include $200 as the opportunity cost of your sister's labour. 
E)  not include your sister's labour since she is family.

Question 7

The following table provides the costs (Cost A and Cost B)and the benenfits associated with each unit of activity
-Consider the Benefit column.As additional units of the activity are undertaken,which of the following statements is the most appropriate?

Accepted Answer

A)  The benefit is rising by increasing marginal amounts. 
B)  The benefit is rising by decreasing marginal amounts. 
C)  The benefit is rising by constant marginal amounts. 
D)  The benefit is changing erratically with no obvious pattern. 
E)  The benefit is falling by constant marginal amounts. 
A)  The benefit is rising by increasing marginal amounts. 
B)  The benefit is rising by decreasing marginal amounts. 
C)  The benefit is rising by constant marginal amounts. 
D)  The benefit is changing erratically with no obvious pattern. 
E)  The benefit is falling by constant marginal amounts.

Question 8

The cost-benefit principle

Accepted Answer

A)  states that an action should be taken only if the total benefit is at least as great as the total cost. 
B)  implies that the cost of all alternatives should be included when choosing among alternatives. 
C)  states that an action should be taken only if the extra benefit is at least as great as the extra cost. 
D)  states that an action should be taken only if the average benefit is greater than the average cost. 
E)  states that an action should be taken only if the extra benefit is less than the extra cost. 
A)  states that an action should be taken only if the total benefit is at least as great as the total cost. 
B)  implies that the cost of all alternatives should be included when choosing among alternatives. 
C)  states that an action should be taken only if the extra benefit is at least as great as the extra cost. 
D)  states that an action should be taken only if the average benefit is greater than the average cost. 
E)  states that an action should be taken only if the extra benefit is less than the extra cost.

Question 9

The scarcity problem indicates __________ and the cost-benefit principle indicates __________.

Accepted Answer

A)  that choices must be made;how to make the choices 
B)  how to make the choices;that choices must be made 
C)  that choices must be made;just one of many possible ways to make the choices 
D)  that choices must be made;that the choices will be poor 
E)  that choices must be made;that the costs can never outweigh the benefits of the choices 
A)  that choices must be made;how to make the choices 
B)  how to make the choices;that choices must be made 
C)  that choices must be made;just one of many possible ways to make the choices 
D)  that choices must be made;that the choices will be poor 
E)  that choices must be made;that the costs can never outweigh the benefits of the choices

Question 10

The study of individual choices and group behaviour in individual markets defines

Accepted Answer

A)  microeconomics. 
B)  economics. 
C)  the scarcity principle. 
D)  macroeconomics. 
E)  the cost-benefit principlE. 
A)  microeconomics. 
B)  economics. 
C)  the scarcity principle. 
D)  macroeconomics. 
E)  the cost-benefit principlE.

Question 11

The extra cost that results from an extra unit of an activity is the

Accepted Answer

A)  marginal benefit. 
B)  marginal surplus. 
C)  marginal cost. 
D)  reservation cost. 
E)  same as the opportunity cost. 
A)  marginal benefit. 
B)  marginal surplus. 
C)  marginal cost. 
D)  reservation cost. 
E)  same as the opportunity cost.

Question 12

The Web site for this textbook can be viewed simultaneously by thousands of students around the world without paying money to view it.Does this suggest that the concept of scarcity does not apply to Web sites?

Accepted Answer

A)  No,because each of the students incurs an opportunity cost,measured by the next best alternative to viewing the Web site. 
B)  Yes,because an additional student viewing the Web site does not prevent another student from viewing it. 
C)  Yes,because the students do not have to pay money to view the Web site and thus they do not have to forgo something else to view it. 
D)  No,because the more students who view it,the slower the transmission of the information to each of the students. 
E)  Yes,because the technology of the internet has made the principles of economics outdated. 
A)  No,because each of the students incurs an opportunity cost,measured by the next best alternative to viewing the Web site. 
B)  Yes,because an additional student viewing the Web site does not prevent another student from viewing it. 
C)  Yes,because the students do not have to pay money to view the Web site and thus they do not have to forgo something else to view it. 
D)  No,because the more students who view it,the slower the transmission of the information to each of the students. 
E)  Yes,because the technology of the internet has made the principles of economics outdated.

Question 13

Ian paid $475 for an airline ticket to fly to Acapulco,Mexico for a spring break vacation.Unfortunately,he fell ill and could not go to Acapulco.When he called the airline to cancel the ticket,he was reminded that the ticket was non-refundable,but that he could exchange it for another ticket within one year if he pays a $75 fee at the time of the exchange.Several months later he is deciding whether to exchange the ticket for a ticket of the same price to Acapulco.The opportunity cost of going to Acapulco would equal

Accepted Answer

A)  the ticket price of $475 plus the $75 exchange fee,if he has no other trip that he will take within the year. 
B)  the ticket price of $475 plus the $75 exchange fee,if he has another trip that he will take within the year. 
C)  the $75 exchange fee,if he has no other trip that he will take within the year. 
D)  the $75 exchange fee,if he has another trip that he will take within the year. 
E)  $0,if he has no other trip that he will take within the year. 
A)  the ticket price of $475 plus the $75 exchange fee,if he has no other trip that he will take within the year. 
B)  the ticket price of $475 plus the $75 exchange fee,if he has another trip that he will take within the year. 
C)  the $75 exchange fee,if he has no other trip that he will take within the year. 
D)  the $75 exchange fee,if he has another trip that he will take within the year. 
E)  $0,if he has no other trip that he will take within the year.

Question 14

The existence of the cost-benefit principle stems from

Accepted Answer

A)  the limited nature of wants. 
B)  the trade-offs the scarcity problem indicates must be made. 
C)  the necessity of government intervention. 
D)  opportunity costs. 
E)  the unlimited nature of resources. 
A)  the limited nature of wants. 
B)  the trade-offs the scarcity problem indicates must be made. 
C)  the necessity of government intervention. 
D)  opportunity costs. 
E)  the unlimited nature of resources.

Question 15

Ethical or value standards are important for the analysis of ______.

Accepted Answer

A)  positive economics. 
B)  the fallacy of composition. 
C)  econometrics. 
D)  spurious correlation. 
E)  welfare economics. 
A)  positive economics. 
B)  the fallacy of composition. 
C)  econometrics. 
D)  spurious correlation. 
E)  welfare economics.

Question 16

Dividing the total cost of N units of an activity by N reveals the

Accepted Answer

A)  average benefit. 
B)  marginal cost. 
C)  units per cost. 
D)  average cost. 
E)  additional cost. 
A)  average benefit. 
B)  marginal cost. 
C)  units per cost. 
D)  average cost. 
E)  additional cost.

Question 17

The following table provides the costs (Cost A and Cost B)and the benenfits associated with each unit of activity
  
-The average cost of 4 units of the activity is

Accepted Answer

A)  $2. 
B)  $10. 
C)  $18. 
D)  $20. 
E)  $50. 
A)  $2. 
B)  $10. 
C)  $18. 
D)  $20. 
E)  $50.

Question 18

TechU College is an expensive private institution and the University of Nova Scotia (UNS)is a public institution.Three semester hours cost $5,000 at TechU and $360 at UNS.If both universities do not refund any tuition after the 3rd week of class,then the cost of dropping a class after the 3rd week is

Accepted Answer

A)  $5,000 at TechU and $360 at UNS. 
B)  More than $5,000 at TechU and more than $360 at UNS. 
C)  not dependent on the price of tuition at either institution. 
D)  higher at TechU. 
E)  lower at UNS. 
A)  $5,000 at TechU and $360 at UNS. 
B)  More than $5,000 at TechU and more than $360 at UNS. 
C)  not dependent on the price of tuition at either institution. 
D)  higher at TechU. 
E)  lower at UNS.

Question 19

Macroeconomics is distinguished by its concentration on

Accepted Answer

A)  choices. 
B)  the performance of national economies and ways to improve upon that performance. 
C)  individual markets. 
D)  the level of prices in specific markets. 
E)  abstract models. 
A)  choices. 
B)  the performance of national economies and ways to improve upon that performance. 
C)  individual markets. 
D)  the level of prices in specific markets. 
E)  abstract models.

Question 20

An economic model is a representation of economic reality that

Accepted Answer

A)  highlights all possible variables and the relationships among them. 
B)  highlights particular variables and the relationships among them. 
C)  predicts how government actions influence the private sector. 
D)  illustrates the difference between economic and non-economic theories. 
E)  focuses strictly on welfare economics. 
A)  highlights all possible variables and the relationships among them. 
B)  highlights particular variables and the relationships among them. 
C)  predicts how government actions influence the private sector. 
D)  illustrates the difference between economic and non-economic theories. 
E)  focuses strictly on welfare economics.

Economic analysis that is concerned with both facts and ethical standards is called _______.

You have just purchased a car for $20,000 and realized that you still have to pay for insurance,licence,parking and gasoline.The $20,000 spent on the car represents

Applying the cost-benefit principle to the issues of large class sizes and recent tuition hikes in Canadian universities and colleges will help to find

The average benefit of an activity is the

The branch of economics that involves the application of statistical techniques to economic data is

You started a new business and your twin sister helped you out for free while she turned down a project that would have paid her a total of $200.When calculating the costs involved in starting up the new business,you should

The following table provides the costs (Cost A and Cost B)and the benenfits associated with each unit of activity -Consider the Benefit column.As additional units of the activity are undertaken,which of the following statements is the most appropriate?

The cost-benefit principle

The scarcity problem indicates and the cost-benefit principle indicates .

The study of individual choices and group behaviour in individual markets defines

The extra cost that results from an extra unit of an activity is the

The Web site for this textbook can be viewed simultaneously by thousands of students around the world without paying money to view it.Does this suggest that the concept of scarcity does not apply to Web sites?

The existence of the cost-benefit principle stems from

Ethical or value standards are important for the analysis of ______.

Dividing the total cost of N units of an activity by N reveals the

The following table provides the costs (Cost A and Cost B)and the benenfits associated with each unit of activity -The average cost of 4 units of the activity is

Macroeconomics is distinguished by its concentration on

An economic model is a representation of economic reality that

Measuring Macroeconomic Performance: Saving and Wealth

Measuring Macroeconomic Performance: Wages, Employment and the Labour Market

Short-Term Economic Fluctuations

Spending and Output in the Short Run

Fiscal Policy

Money, Prices and the Reserve Bank

The Reserve Bank and the Economy

The Aggregate Demand - Aggregate Supply Model

Macroeconomic Policy

The Economy in the Long Run: an Introduction to Economic Growth

The Production Function Approach to Understanding Growth

Savings, Capital Formation and Comparative Economic Growth

International Trade

Exchange Rates and the Open Economy

The Balance of Payments: Net Exports and International Capital Flows

Filters

Exam 1: Measuring Macroeconomic Performance: Output and Prices

Economic analysis that is concerned with both facts and ethical standards is called _______.

You have just purchased a car for $20,000 and realized that you still have to pay for insurance,licence,parking and gasoline.The $20,000 spent on the car represents

Applying the cost-benefit principle to the issues of large class sizes and recent tuition hikes in Canadian universities and colleges will help to find

The average benefit of an activity is the

The branch of economics that involves the application of statistical techniques to economic data is

You started a new business and your twin sister helped you out for free while she turned down a project that would have paid her a total of $200.When calculating the costs involved in starting up the new business,you should

The following table provides the costs (Cost A and Cost B)and the benenfits associated with each unit of activity -Consider the Benefit column.As additional units of the activity are undertaken,which of the following statements is the most appropriate?

The cost-benefit principle

The scarcity problem indicates __________ and the cost-benefit principle indicates __________.

The study of individual choices and group behaviour in individual markets defines

The extra cost that results from an extra unit of an activity is the

The Web site for this textbook can be viewed simultaneously by thousands of students around the world without paying money to view it.Does this suggest that the concept of scarcity does not apply to Web sites?

The existence of the cost-benefit principle stems from

Ethical or value standards are important for the analysis of ______.

Dividing the total cost of N units of an activity by N reveals the

The following table provides the costs (Cost A and Cost B)and the benenfits associated with each unit of activity -The average cost of 4 units of the activity is

Macroeconomics is distinguished by its concentration on

An economic model is a representation of economic reality that

Measuring Macroeconomic Performance: Saving and Wealth

Measuring Macroeconomic Performance: Wages, Employment and the Labour Market

Short-Term Economic Fluctuations

Spending and Output in the Short Run

Fiscal Policy

Money, Prices and the Reserve Bank

The Reserve Bank and the Economy

The Aggregate Demand - Aggregate Supply Model

Macroeconomic Policy

The Economy in the Long Run: an Introduction to Economic Growth

The Production Function Approach to Understanding Growth

Savings, Capital Formation and Comparative Economic Growth

International Trade

Exchange Rates and the Open Economy

The Balance of Payments: Net Exports and International Capital Flows

Filters

The scarcity problem indicates and the cost-benefit principle indicates .