Question 1

Which principle underlies the interaction of individual choices?

Accepted Answer

A)  Choices are necessary because resources are scarce. 
B)  There are gains from trade. 
C)  "How much" is a decision at the margin 
D)  People usually respond to incentives,exploiting opportunities to make themselves better off. 
A)  Choices are necessary because resources are scarce. 
B)  There are gains from trade. 
C)  "How much" is a decision at the margin 
D)  People usually respond to incentives,exploiting opportunities to make themselves better off.

Question 2

A trade-off involves weighing costs and benefits.

Accepted Answer

A) True 
 B)False

Question 3

Your elderly grandma tells you: "I haven't been taking my beloved walks because I'm concerned about falling and getting hurt.See,there is always a cost to doing something.But if you don't do anything,then there is no cost." Your grandma does not understand the economic concept of:

Accepted Answer

A)  scarcity. 
B)  efficiency. 
C)  opportunity cost. 
D)  marginal analysis. 
A)  scarcity. 
B)  efficiency. 
C)  opportunity cost. 
D)  marginal analysis.

Question 4

Because Canada is a rich nation,free health care can be provided for all citizens without considering the issue of scarcity.

Accepted Answer

A) True 
 B)False

Question 5

I know when I shop at the local grocery store,I am helping my community.Which economic principle does this statement BEST represent?

Accepted Answer

A)  People usually respond to incentives,exploiting opportunities to make themselves better off. 
B)  There are gains from trade. 
C)  One person's spending is another person's income. 
D)  Overall spending sometimes gets out of line with the economy's productive capacity. 
A)  People usually respond to incentives,exploiting opportunities to make themselves better off. 
B)  There are gains from trade. 
C)  One person's spending is another person's income. 
D)  Overall spending sometimes gets out of line with the economy's productive capacity.

Question 6

If every individual were required to be self-sufficient:

Accepted Answer

A)  living standards would fall. 
B)  living standards for some individuals would fall,but for others,they would rise. 
C)  living standards would rise. 
D)  it's impossible to say how living standards would change. 
A)  living standards would fall. 
B)  living standards for some individuals would fall,but for others,they would rise. 
C)  living standards would rise. 
D)  it's impossible to say how living standards would change.

Question 7

People who live in large cities decide to spend less in their day-to-day activities.This will MOST likely lead to:

Accepted Answer

A)  less income for other people 
B)  more income for other people. 
C)  no impact on other people. 
D)  inflation. 
A)  less income for other people 
B)  more income for other people. 
C)  no impact on other people. 
D)  inflation.

Question 8

A university student is faced with a difficult decision of how to spend 1 hour tonight.She could babysit her professor's child at an hourly wage of $7;she could work at the university library at a wage of $6;or she could finish her economics homework assignment.If she chooses to complete her homework assignment,she has incurred an opportunity cost equal to:

Accepted Answer

A)  $7. 
B)  $6. 
C)  $13. 
D)  $0. 
A)  $7. 
B)  $6. 
C)  $13. 
D)  $0.

Question 9

Which factor is NOT an example of a resource?

Accepted Answer

A)  land 
B)  labour 
C)  capital 
D)  production 
A)  land 
B)  labour 
C)  capital 
D)  production

Question 10

Which statement is NOT one of the five principles for understanding how individual choices interact?

Accepted Answer

A)  There are gains from trade. 
B)  Markets move toward equilibrium. 
C)  Resources should be used as efficiently as possible to achieve society's goals. 
D)  Overall spending sometimes gets out of line with the economy's productive capability. 
A)  There are gains from trade. 
B)  Markets move toward equilibrium. 
C)  Resources should be used as efficiently as possible to achieve society's goals. 
D)  Overall spending sometimes gets out of line with the economy's productive capability.

Question 11

Which statement demonstrates how people respond to incentives to make themselves better off?

Accepted Answer

A)  More students major in economics when they hear that salaries for economists are rising. 
B)  Students are assigned dorm rooms through a lottery system. 
C)  Students are encouraged to donate blood because it is the right thing to do. 
D)  Students and faculty are encouraged to wear university apparel to support the university athletic teams. 
A)  More students major in economics when they hear that salaries for economists are rising. 
B)  Students are assigned dorm rooms through a lottery system. 
C)  Students are encouraged to donate blood because it is the right thing to do. 
D)  Students and faculty are encouraged to wear university apparel to support the university athletic teams.

Question 12

Freshwater is considered a scarce good because:

Accepted Answer

A)  not enough of it is available for all needs. 
B)  it does not have any uses. 
C)  scarce goods are not expensive. 
D)  not enough of it is available for all needs and because it is not expensive. 
A)  not enough of it is available for all needs. 
B)  it does not have any uses. 
C)  scarce goods are not expensive. 
D)  not enough of it is available for all needs and because it is not expensive.

Question 13

A central and fundamental theme in economics is that:

Accepted Answer

A)  wants are limited. 
B)  Canada is a rich country,but we are simply not aware of it. 
C)  people have unlimited wants but limited means to satisfy them. 
D)  resources are unlimited. 
A)  wants are limited. 
B)  Canada is a rich country,but we are simply not aware of it. 
C)  people have unlimited wants but limited means to satisfy them. 
D)  resources are unlimited.

Question 14

Economists believe that resources should be used as efficiently as possible to:

Accepted Answer

A)  achieve society's goals. 
B)  eliminate scarcity. 
C)  reduce inequity. 
D)  maximize profits. 
A)  achieve society's goals. 
B)  eliminate scarcity. 
C)  reduce inequity. 
D)  maximize profits.

Question 15

It is cheaper to produce corn in Quebec,because corn needs a lot of water and moderate temperatures.Which economic concept does this statement BEST represent?

Accepted Answer

A)  Government policies can change spending. 
B)  Markets move toward equilibrium. 
C)  Resources should be used as efficiently as possible to achieve society's goals. 
D)  One person's spending is another person's income. 
A)  Government policies can change spending. 
B)  Markets move toward equilibrium. 
C)  Resources should be used as efficiently as possible to achieve society's goals. 
D)  One person's spending is another person's income.

Question 16

Market failure occurs when the pursuit of self-interest leads to bad results for society.

Accepted Answer

A) True 
 B)False

Question 17

An economy has achieved _____ if it _____ pass up any opportunities to make some people better off without making others worse off.

Accepted Answer

A)  efficiency;does not 
B)  equity;does 
C)  efficiency;does 
D)  equity;does not 
A)  efficiency;does not 
B)  equity;does 
C)  efficiency;does 
D)  equity;does not

Question 18

Which statement is an example of individual choice?

Accepted Answer

A)  The government announces plans to ban smoking in all Quebec restaurants. 
B)  Lauren spends her allowance on pillows for her bed. 
C)  France decides to withhold funding to rebuild Iraq. 
D)  Africa decides to accept Canadian aid for humanitarian efforts. 
A)  The government announces plans to ban smoking in all Quebec restaurants. 
B)  Lauren spends her allowance on pillows for her bed. 
C)  France decides to withhold funding to rebuild Iraq. 
D)  Africa decides to accept Canadian aid for humanitarian efforts.

Question 19

You decide to join the economics club,but this means you can't join the accounting club because it meets at the same time.Which economic principle does this statement BEST represent?

Accepted Answer

A)  The true cost of something is its opportunity cost. 
B)  "How much" is a decision at the margin. 
C)  People usually respond to incentives,exploiting opportunities to make themselves better off. 
D)  There are gains from trade. 
A)  The true cost of something is its opportunity cost. 
B)  "How much" is a decision at the margin. 
C)  People usually respond to incentives,exploiting opportunities to make themselves better off. 
D)  There are gains from trade.

Question 20

Trade theoretically allows people to get more of what they want.

Accepted Answer

A) True 
 B)False

Which principle underlies the interaction of individual choices?

A trade-off involves weighing costs and benefits.

Your elderly grandma tells you: "I haven't been taking my beloved walks because I'm concerned about falling and getting hurt.See,there is always a cost to doing something.But if you don't do anything,then there is no cost." Your grandma does not understand the economic concept of:

Because Canada is a rich nation,free health care can be provided for all citizens without considering the issue of scarcity.

I know when I shop at the local grocery store,I am helping my community.Which economic principle does this statement BEST represent?

If every individual were required to be self-sufficient:

People who live in large cities decide to spend less in their day-to-day activities.This will MOST likely lead to:

Which factor is NOT an example of a resource?

Which statement is NOT one of the five principles for understanding how individual choices interact?

Which statement demonstrates how people respond to incentives to make themselves better off?

Freshwater is considered a scarce good because:

A central and fundamental theme in economics is that:

Economists believe that resources should be used as efficiently as possible to:

It is cheaper to produce corn in Quebec,because corn needs a lot of water and moderate temperatures.Which economic concept does this statement BEST represent?

Market failure occurs when the pursuit of self-interest leads to bad results for society.

An economy has achieved _ if it _ pass up any opportunities to make some people better off without making others worse off.

Which statement is an example of individual choice?

You decide to join the economics club,but this means you can't join the accounting club because it meets at the same time.Which economic principle does this statement BEST represent?

Trade theoretically allows people to get more of what they want.

Economic Models: Trade-Offs and Trade

Supply and Demand

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

Gdp and the Cpi: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Graphs in Economics

Filters

Exam 1: First Principles

Which principle underlies the interaction of individual choices?

A trade-off involves weighing costs and benefits.

Your elderly grandma tells you: "I haven't been taking my beloved walks because I'm concerned about falling and getting hurt.See,there is always a cost to doing something.But if you don't do anything,then there is no cost." Your grandma does not understand the economic concept of:

Because Canada is a rich nation,free health care can be provided for all citizens without considering the issue of scarcity.

I know when I shop at the local grocery store,I am helping my community.Which economic principle does this statement BEST represent?

If every individual were required to be self-sufficient:

People who live in large cities decide to spend less in their day-to-day activities.This will MOST likely lead to:

Which factor is NOT an example of a resource?

Which statement is NOT one of the five principles for understanding how individual choices interact?

Which statement demonstrates how people respond to incentives to make themselves better off?

Freshwater is considered a scarce good because:

A central and fundamental theme in economics is that:

Economists believe that resources should be used as efficiently as possible to:

It is cheaper to produce corn in Quebec,because corn needs a lot of water and moderate temperatures.Which economic concept does this statement BEST represent?

Market failure occurs when the pursuit of self-interest leads to bad results for society.

An economy has achieved _____ if it _____ pass up any opportunities to make some people better off without making others worse off.

Which statement is an example of individual choice?

You decide to join the economics club,but this means you can't join the accounting club because it meets at the same time.Which economic principle does this statement BEST represent?

Trade theoretically allows people to get more of what they want.

Economic Models: Trade-Offs and Trade

Supply and Demand

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

Gdp and the Cpi: Tracking the Macroeconomy

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Graphs in Economics

Filters

An economy has achieved _ if it _ pass up any opportunities to make some people better off without making others worse off.