Question 1

________ have a horizontal and a vertical axis and are used in economics to illustrate relationships between two economic variables.

Accepted Answer

A) Two-dimensional graphs 
B) One-dimensional graphs 
C) Pie Charts 
D) Bar graphs 
A) Two-dimensional graphs 
B) One-dimensional graphs 
C) Pie Charts 
D) Bar graphs

Question 2

Automobile manufacturers produce a range of automobiles such as sports utility vehicles,luxury sedans,pickup trucks and compact cars.What fundamental economic question are they addressing by making this range of products?

Accepted Answer

A) How will goods that consumers want be produced? 
B) Why should a variety of automobiles be produced? 
C) What will be produced? 
D) For whom will automobiles be produced? 
A) How will goods that consumers want be produced? 
B) Why should a variety of automobiles be produced? 
C) What will be produced? 
D) For whom will automobiles be produced?

Question 3

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 primar

Question 4

Policies based on positive economic ideas tend to decrease economic efficiency and reduce equity.

Accepted Answer

A) True 
 B)False

Question 5

Arlene quits her $125 000-a-year job to take care of her ailing parents.What is the opportunity cost of her decision?

Accepted Answer

A) zero,since she will no longer be earning a salary 
B) It depends on the 'going rate' for home-care providers. 
C) at least $125 000 
D) the value she attributes to the satisfaction she receives from taking care of her parents 
A) zero,since she will no longer be earning a salary 
B) It depends on the 'going rate' for home-care providers. 
C) at least $125 000 
D) the value she attributes to the satisfaction she receives from taking care of her parents

Question 6

What is the difference between positive economic analysis and normative economic analysis? Give one example each of a positive and normative economic issue or question or statement.

Accepted Answer

Positive economic analysis is concerned

Question 7

Suppose that some teachers have decided that economic and financial uncertainty have made the prospect of retiring more risky,and therefore carry a higher cost than not retiring.By using all available information as they act to achieve their goals,these teachers are exemplifying the economic idea that

Accepted Answer

A) people are rational. 
B) people respond to economic incentives. 
C) optimal decisions are made at the margin. 
D) equity is more important than efficiency. 
A) people are rational. 
B) people respond to economic incentives. 
C) optimal decisions are made at the margin. 
D) equity is more important than efficiency.

Question 8

Explain why economics is considered a social science.

Accepted Answer

Economics is a social science

Question 9

Mr.Peabody chooses to invest in companies that produce goods and services based on consumer preferences.Mr.Peabody is investing in companies that are attempting to be

Accepted Answer

A) allocatively efficient. 
B) productively efficient. 
C) guaranteed to make a profit. 
D) all of the above. 
A) allocatively efficient. 
B) productively efficient. 
C) guaranteed to make a profit. 
D) all of the above.

Question 10

The decision about what goods and services will be produced in a market economy is made by

Accepted Answer

A) lawmakers in the government voting on what will be produced. 
B) workers deciding to produce only what the boss says must be produced. 
C) producers deciding what society wants most. 
D) consumers and firms choosing which goods and services to buy or produce. 
A) lawmakers in the government voting on what will be produced. 
B) workers deciding to produce only what the boss says must be produced. 
C) producers deciding what society wants most. 
D) consumers and firms choosing which goods and services to buy or produce.

Question 11

Figure 1-3  
-Refer to Figure 1-3.Calculate the area of the trapezoid X.

Accepted Answer

A) $270 
B) $720 
C) $810 
D) $2520 
A) $270 
B) $720 
C) $810 
D) $2520

Question 12

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 13

If the price of milk was $2.50 a litre and it is now $3.25 a litre,what is the percentage change in price?

Accepted Answer

A) 13 per cent 
B) 30 per cent 
C) 75 per cent 
D) 77 per cent 
A) 13 per cent 
B) 30 per cent 
C) 75 per cent 
D) 77 per cent

Question 14

What is meant by the statement that 'optimal decisions are made at the margin'?

Accepted Answer

In economics,the word 'marginal' means '

Question 15

What is an economic model?

Accepted Answer

An economic model is a simplif

Question 16

Economic models do all of the following except

Accepted Answer

A) answer economic questions. 
B) portray reality in all its minute details. 
C) make economic ideas explicit and concrete for use by decision makers. 
D) simplify some aspect of economic life. 
A) answer economic questions. 
B) portray reality in all its minute details. 
C) make economic ideas explicit and concrete for use by decision makers. 
D) simplify some aspect of economic life.

Question 17

The branch of economics which studies the behaviour of entire economies is called

Accepted Answer

A) public economics. 
B) microeconomics. 
C) macroeconomics. 
D) normative economics. 
A) public economics. 
B) microeconomics. 
C) macroeconomics. 
D) normative economics.

Question 18

The term ________ in economics refers to a group of buyers and sellers of a product and the arrangement by which they come together to trade.

Accepted Answer

A) collective 
B) cooperative 
C) market 
D) trade-off 
A) collective 
B) cooperative 
C) market 
D) trade-off

Question 19

What is the 'omitted variable' problem in determining cause and effect?

Accepted Answer

A) It is a problem that arises when an insignificant variable is given too much weight in an economic analysis,leading to skewed conclusions about cause and effect. 
B) It is a problem that arises when a significant variable is not given enough weight in an economic analysis,leading to skewed conclusions about cause and effect. 
C) It is a problem that arises when an insignificant economic variable that should have been omitted is included in an economic analysis,leading to false conclusions about cause and effect. 
D) It is a problem that arises when an economic variable that affects other variables is omitted from an analysis,and its omission leads to false conclusions about cause and effect. 
A) It is a problem that arises when an insignificant variable is given too much weight in an economic analysis,leading to skewed conclusions about cause and effect. 
B) It is a problem that arises when a significant variable is not given enough weight in an economic analysis,leading to skewed conclusions about cause and effect. 
C) It is a problem that arises when an insignificant economic variable that should have been omitted is included in an economic analysis,leading to false conclusions about cause and effect. 
D) It is a problem that arises when an economic variable that affects other variables is omitted from an analysis,and its omission leads to false conclusions about cause and effect.

Question 20

Explain the economic idea that 'people respond to incentives.'

Accepted Answer

Human beings act from a variety of motiv

________ have a horizontal and a vertical axis and are used in economics to illustrate relationships between two economic variables.

Automobile manufacturers produce a range of automobiles such as sports utility vehicles,luxury sedans,pickup trucks and compact cars.What fundamental economic question are they addressing by making this range of products?

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

Policies based on positive economic ideas tend to decrease economic efficiency and reduce equity.

Arlene quits her $125 000-a-year job to take care of her ailing parents.What is the opportunity cost of her decision?

What is the difference between positive economic analysis and normative economic analysis? Give one example each of a positive and normative economic issue or question or statement.

Explain why economics is considered a social science.

Mr.Peabody chooses to invest in companies that produce goods and services based on consumer preferences.Mr.Peabody is investing in companies that are attempting to be

The decision about what goods and services will be produced in a market economy is made by

Figure 1-3 -Refer to Figure 1-3.Calculate the area of the trapezoid X.

By definition,economics is the study of

If the price of milk was $2.50 a litre and it is now $3.25 a litre,what is the percentage change in price?

What is meant by the statement that 'optimal decisions are made at the margin'?

What is an economic model?

Economic models do all of the following except

The branch of economics which studies the behaviour of entire economies is called

The term ________ in economics refers to a group of buyers and sellers of a product and the arrangement by which they come together to trade.

What is the 'omitted variable' problem in determining cause and effect?

Explain the economic idea that 'people respond to incentives.'

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

Oligopoly: Firms in Less Competitive Markets

The Markets for Labour and Other Factors of Production

International Trade

Government Intervention in the Market

Externalities, Environmental Policy and Public Goods

The Distribution of Income and Social Policy

Filters

Exam 1: Economics: Foundations and Models

________ have a horizontal and a vertical axis and are used in economics to illustrate relationships between two economic variables.

Automobile manufacturers produce a range of automobiles such as sports utility vehicles,luxury sedans,pickup trucks and compact cars.What fundamental economic question are they addressing by making this range of products?

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

Policies based on positive economic ideas tend to decrease economic efficiency and reduce equity.

Arlene quits her $125 000-a-year job to take care of her ailing parents.What is the opportunity cost of her decision?

What is the difference between positive economic analysis and normative economic analysis? Give one example each of a positive and normative economic issue or question or statement.

Explain why economics is considered a social science.

Mr.Peabody chooses to invest in companies that produce goods and services based on consumer preferences.Mr.Peabody is investing in companies that are attempting to be

The decision about what goods and services will be produced in a market economy is made by

Figure 1-3 -Refer to Figure 1-3.Calculate the area of the trapezoid X.

By definition,economics is the study of

If the price of milk was $2.50 a litre and it is now $3.25 a litre,what is the percentage change in price?

What is meant by the statement that 'optimal decisions are made at the margin'?

What is an economic model?

Economic models do all of the following except

The branch of economics which studies the behaviour of entire economies is called

The term ________ in economics refers to a group of buyers and sellers of a product and the arrangement by which they come together to trade.

What is the 'omitted variable' problem in determining cause and effect?

Explain the economic idea that 'people respond to incentives.'

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

Oligopoly: Firms in Less Competitive Markets

The Markets for Labour and Other Factors of Production

International Trade

Government Intervention in the Market

Externalities, Environmental Policy and Public Goods

The Distribution of Income and Social Policy

Filters