Question 1

Studying how the management of Hewlett Packard decides how many computers to produce and the price to charge for its computers would be considered

Accepted Answer

A) descriptive economics. 
B) empirical economics. 
C) microeconomics. 
D) macroeconomics. 
A) descriptive economics. 
B) empirical economics. 
C) microeconomics. 
D) macroeconomics.

Question 2

The reason that opportunity costs arise is that

Accepted Answer

A) an economy relies on money to facilitate exchange of goods and services. 
B) resources are scarce. 
C) there are no alternative decisions that could be made. 
D) people have limited wants. 
A) an economy relies on money to facilitate exchange of goods and services. 
B) resources are scarce. 
C) there are no alternative decisions that could be made. 
D) people have limited wants.

Question 3

Stanley Jevons,an economist in the nineteenth century,noted a high correlation between economic prosperity and sunspots.Based on this observation he developed a "sunspot theory" of how the economy operated.We now know that Jevons

Accepted Answer

A) committed the fallacy of composition. 
B) committed the ceteris paribus error. 
C) was confusing causality. 
D) showed good reasoning for the nineteenth but not the twentieth century. 
A) committed the fallacy of composition. 
B) committed the ceteris paribus error. 
C) was confusing causality. 
D) showed good reasoning for the nineteenth but not the twentieth century.

Question 4

If you eat at a sushi restaurant that charges $20 for its all you can eat sushi special,then the marginal cost of your 10th piece of sushi is

Accepted Answer

A) zero. 
B) $2. 
C) $200. 
D) $2,000. 
A) zero. 
B) $2. 
C) $200. 
D) $2,000.

Question 5

The fallacy of composition is

Accepted Answer

A) the belief that if Event A happens before Event B happens,then Event A causes Event B to occur. 
B) the belief that what is true for the whole is necessarily true of the parts. 
C) the belief that what is true for a part is necessarily true for the whole. 
D) the belief that it is impossible to draw generalizations about cause and effect. 
A) the belief that if Event A happens before Event B happens,then Event A causes Event B to occur. 
B) the belief that what is true for the whole is necessarily true of the parts. 
C) the belief that what is true for a part is necessarily true for the whole. 
D) the belief that it is impossible to draw generalizations about cause and effect.

Question 6

It always rains about an hour after you finish washing your car.Concluding that washing your car caused it to rain is an example of the

Accepted Answer

A) fallacy of composition. 
B) post hoc,ergo propter hoc fallacy. 
C) fallacy of inductive reasoning. 
D) ceteris paribus conditions. 
A) fallacy of composition. 
B) post hoc,ergo propter hoc fallacy. 
C) fallacy of inductive reasoning. 
D) ceteris paribus conditions.

Question 7

The aggregate price level is a topic of macroeconomics.

Accepted Answer

A) True 
 B)False

Question 8

If as the variable on the Y-axis falls the variable on the X-axis rises,the relationship between X and Y is said to be a negative relationship.

Accepted Answer

A) True 
 B)False

Question 9

Positive economics is an approach to economics that

Accepted Answer

A) seeks to understand behavior and the operation of systems while making judgments about their usefulness to society. 
B) analyzes outcomes of economic behavior,evaluates them as good or bad,and may prescribe preferred courses of action. 
C) seeks to understand behavior and the operation of systems without making judgments. 
D) examines the role of government in the economy. 
A) seeks to understand behavior and the operation of systems while making judgments about their usefulness to society. 
B) analyzes outcomes of economic behavior,evaluates them as good or bad,and may prescribe preferred courses of action. 
C) seeks to understand behavior and the operation of systems without making judgments. 
D) examines the role of government in the economy.

Question 10

If as the variable on the Y-axis rises the variable on the X-axis rises,the relationship between X and Y is said to be a positive relationship.

Accepted Answer

A) True 
 B)False

Question 11

Better insurance benefits increase the incentive of some individuals to work.This statement is best described as

Accepted Answer

A) a positive statement. 
B) an example of the ceteris paribus assumption. 
C) a normative statement. 
D) a comparative economics statement. 
A) a positive statement. 
B) an example of the ceteris paribus assumption. 
C) a normative statement. 
D) a comparative economics statement.

Question 12

You have decided that you want to attend a costume party as Iron Man.You estimate that it will cost $40 to assemble your costume.After spending $40 on the costume,you realize that the additional pieces you need will cost you $25 more.The marginal cost of completing the costume is

Accepted Answer

A) $15. 
B) $25. 
C) $40. 
D) $65. 
A) $15. 
B) $25. 
C) $40. 
D) $65.

Question 13

Opportunity costs arise due to scarce resources.

Accepted Answer

A) True 
 B)False

Question 14

If the slope of a straight line is 4 and if X (the variable on the horizontal axis)increases by 12,then Y (the variable on the vertical axis)will

Accepted Answer

A) decrease by 3. 
B) decrease by 0.33. 
C) increase by 3. 
D) increase by 48. 
A) decrease by 3. 
B) decrease by 0.33. 
C) increase by 3. 
D) increase by 48.

Question 15

Refer to Scenario 1.1 below to answer the questions that follow.
SCENARIO 1.1: An economist wants to understand the relationship between minimum wages and the level of teenage unemployment.The economist collects data on the values of the minimum wage and the levels of teenage unemployment over time.The economist concludes that a 1% increase in minimum wage causes a 0.2% increase in teenage unemployment.From this information he concludes that the minimum wage is harmful to teenagers and should be reduced or eliminated to increase employment among teenagers.
-Refer to Scenario 1.1.The statement that a 1% increase in the minimum wage causes a 0.2% increase in teenage unemployment is an example of

Accepted Answer

A) the fallacy of composition. 
B) normative economics. 
C) positive economics. 
D) Ockham's razor. 
A) the fallacy of composition. 
B) normative economics. 
C) positive economics. 
D) Ockham's razor.

Question 16

Which of the following is an example of a normative statement?

Accepted Answer

A) The unemployment rate is six percent. 
B) There should be no unemployment in an advanced industrial society. 
C) Higher prices cause consumers to buy less. 
D) Equilibrium price implies that quantity demanded equals quantity supplied. 
A) The unemployment rate is six percent. 
B) There should be no unemployment in an advanced industrial society. 
C) Higher prices cause consumers to buy less. 
D) Equilibrium price implies that quantity demanded equals quantity supplied.

Question 17

A formal statement of a theory is known as a(n)

Accepted Answer

A) model. 
B) positive statement. 
C) empirical measure. 
D) causal statement. 
A) model. 
B) positive statement. 
C) empirical measure. 
D) causal statement.

Question 18

Ceteris paribus literally translated means,"buyer beware."

Accepted Answer

A) True 
 B)False

Question 19

The value of the best alternative foregone is the opportunity cost of making a decision.

Accepted Answer

A) True 
 B)False

Question 20

At a political rally,you stand up to see better.Everyone else stands up,as well.This is an example of

Accepted Answer

A) ceteris paribus. 
B) the post hoc,ergo propter hoc fallacy. 
C) the fallacy of composition. 
D) Ockham's razor. 
A) ceteris paribus. 
B) the post hoc,ergo propter hoc fallacy. 
C) the fallacy of composition. 
D) Ockham's razor.

Studying how the management of Hewlett Packard decides how many computers to produce and the price to charge for its computers would be considered

The reason that opportunity costs arise is that

Stanley Jevons,an economist in the nineteenth century,noted a high correlation between economic prosperity and sunspots.Based on this observation he developed a "sunspot theory" of how the economy operated.We now know that Jevons

If you eat at a sushi restaurant that charges $20 for its all you can eat sushi special,then the marginal cost of your 10th piece of sushi is

The fallacy of composition is

It always rains about an hour after you finish washing your car.Concluding that washing your car caused it to rain is an example of the

The aggregate price level is a topic of macroeconomics.

If as the variable on the Y-axis falls the variable on the X-axis rises,the relationship between X and Y is said to be a negative relationship.

Positive economics is an approach to economics that

If as the variable on the Y-axis rises the variable on the X-axis rises,the relationship between X and Y is said to be a positive relationship.

Better insurance benefits increase the incentive of some individuals to work.This statement is best described as

You have decided that you want to attend a costume party as Iron Man.You estimate that it will cost $40 to assemble your costume.After spending $40 on the costume,you realize that the additional pieces you need will cost you $25 more.The marginal cost of completing the costume is

Opportunity costs arise due to scarce resources.

If the slope of a straight line is 4 and if X (the variable on the horizontal axis)increases by 12,then Y (the variable on the vertical axis)will

Which of the following is an example of a normative statement?

A formal statement of a theory is known as a(n)

Ceteris paribus literally translated means,"buyer beware."

The value of the best alternative foregone is the opportunity cost of making a decision.

At a political rally,you stand up to see better.Everyone else stands up,as well.This is an example of

The Economic Problem: Scarcity and Choice

Demand,supply,and Market Equilibrium

Demand and Supply Applications

Introduction to Macroeconomics

Measuring National Output and National Income

Unemployment,inflation,and Long-Run Growth

Aggregate Expenditure and Equilibrium Output

The Government and Fiscal Policy

The Money Supply and the Federal Reserve System

Money Demand and the Equilibrium Interest Rate

The Determination of Aggregate Output, the Price Level, and the Interest Rate

Policy Effects and Costs Shocks in the Asad Model

The Labor Market in the Macroeconomy

Financial Crises, stabilization, and Deficits

Household and Firm Behavior in the Macroeconomy: a Further Look

Long-Run Growth

Alternative Views in Macroeconomics

International Trade, comparative Advantage, and Protectionism

Open-Economy Macroeconomics: the Balance of Payments and Exchange Rates

Economic Growth in Developing and Transitional Economies

Filters

Exam 1: The Scope and Method of Economics

Studying how the management of Hewlett Packard decides how many computers to produce and the price to charge for its computers would be considered

The reason that opportunity costs arise is that

Stanley Jevons,an economist in the nineteenth century,noted a high correlation between economic prosperity and sunspots.Based on this observation he developed a "sunspot theory" of how the economy operated.We now know that Jevons

If you eat at a sushi restaurant that charges $20 for its all you can eat sushi special,then the marginal cost of your 10th piece of sushi is

The fallacy of composition is

It always rains about an hour after you finish washing your car.Concluding that washing your car caused it to rain is an example of the

The aggregate price level is a topic of macroeconomics.

If as the variable on the Y-axis falls the variable on the X-axis rises,the relationship between X and Y is said to be a negative relationship.

Positive economics is an approach to economics that

If as the variable on the Y-axis rises the variable on the X-axis rises,the relationship between X and Y is said to be a positive relationship.

Better insurance benefits increase the incentive of some individuals to work.This statement is best described as

You have decided that you want to attend a costume party as Iron Man.You estimate that it will cost $40 to assemble your costume.After spending $40 on the costume,you realize that the additional pieces you need will cost you $25 more.The marginal cost of completing the costume is

Opportunity costs arise due to scarce resources.

If the slope of a straight line is 4 and if X (the variable on the horizontal axis)increases by 12,then Y (the variable on the vertical axis)will

Which of the following is an example of a normative statement?

A formal statement of a theory is known as a(n)

Ceteris paribus literally translated means,"buyer beware."

The value of the best alternative foregone is the opportunity cost of making a decision.

At a political rally,you stand up to see better.Everyone else stands up,as well.This is an example of

The Economic Problem: Scarcity and Choice

Demand,supply,and Market Equilibrium

Demand and Supply Applications

Introduction to Macroeconomics

Measuring National Output and National Income

Unemployment,inflation,and Long-Run Growth

Aggregate Expenditure and Equilibrium Output

The Government and Fiscal Policy

The Money Supply and the Federal Reserve System

Money Demand and the Equilibrium Interest Rate

The Determination of Aggregate Output, the Price Level, and the Interest Rate

Policy Effects and Costs Shocks in the Asad Model

The Labor Market in the Macroeconomy

Financial Crises, stabilization, and Deficits

Household and Firm Behavior in the Macroeconomy: a Further Look

Long-Run Growth

Alternative Views in Macroeconomics

International Trade, comparative Advantage, and Protectionism

Open-Economy Macroeconomics: the Balance of Payments and Exchange Rates

Economic Growth in Developing and Transitional Economies

Filters