Question 1

Which of the following is a positive statement?

Accepted Answer

A)  Taxes should be lower because then people get to keep more of what they earn, so they will work more. 
B)  My economics class should last for two terms because it is my favorite class. 
C)  A 10 percent increase in income leads to a 4 percent increase in the consumption of beef. 
D)  Given their negative impact on productivity, the government should eliminate labor unions. 
E)  The class average on this test should be more than 80 percent. 
A)  Taxes should be lower because then people get to keep more of what they earn, so they will work more. 
B)  My economics class should last for two terms because it is my favorite class. 
C)  A 10 percent increase in income leads to a 4 percent increase in the consumption of beef. 
D)  Given their negative impact on productivity, the government should eliminate labor unions. 
E)  The class average on this test should be more than 80 percent.

Question 2

What is the reason that all economic issues and problems occur?

Accepted Answer

A)  All nations use some form of money to buy and sell goods and services. 
B)  Humans are always wasteful and inefficient in production and consumption. 
C)  Powerful governments are able to control production and consumption. 
D)  Human wants exceed the resources available to satisfy them. 
E)  People seek only their own self-interest. 
A)  All nations use some form of money to buy and sell goods and services. 
B)  Humans are always wasteful and inefficient in production and consumption. 
C)  Powerful governments are able to control production and consumption. 
D)  Human wants exceed the resources available to satisfy them. 
E)  People seek only their own self-interest.

Question 3

Suppose that your public library charges a fixed monthly membership fee of $12.Members are allowed to check out as many books as they want under this plan.The average member checks out 4 books per month.Suppose that your public library changes its policy.Now each book costs $3 to check out but there is no longer a monthly membership fee.What effect do you think the new policy will have on the total number of books checked out from your library each month? The new policy is likely to ______the number of booked checked out because ________.

Accepted Answer

A)  leave unchanged; members have already shown that they are willing to pay $12 to check out 4 books per month 
B)  leave unchanged; the average cost of the library service is the same under both plans 
C)  reduce; the marginal benefit of checking out books is now lower under the new policy 
D)  reduce; the marginal cost of checking out books is now higher under the new policy 
E)  increase; the average benefit of checking out more than 4 books is now higher under the new policy 
A)  leave unchanged; members have already shown that they are willing to pay $12 to check out 4 books per month 
B)  leave unchanged; the average cost of the library service is the same under both plans 
C)  reduce; the marginal benefit of checking out books is now lower under the new policy 
D)  reduce; the marginal cost of checking out books is now higher under the new policy 
E)  increase; the average benefit of checking out more than 4 books is now higher under the new policy

Question 4

-What is the slope of the line in the figure above?

Accepted Answer

A)  0.75 
B)  -0.75 
C)  1.33 
D)  -1.33 
E)  zero 
A)  0.75 
B)  -0.75 
C)  1.33 
D)  -1.33 
E)  zero

Question 5

The horizontal axis in a graph

Accepted Answer

A)  measures time on a scatter diagram. 
B)  measures the quality of a variable. 
C)  is named the y-axis. 
D)  is named the x-axis. 
E)  is called the origin. 
A)  measures time on a scatter diagram. 
B)  measures the quality of a variable. 
C)  is named the y-axis. 
D)  is named the x-axis. 
E)  is called the origin.

Question 6

What kind of information is conveyed in a time-series graph?

Accepted Answer

A time series graph reveals four types o

Question 7

Which of the following is a topic studied in macroeconomics?

Accepted Answer

A)  The pricing decisions in the computer hardware industry 
B)  The effect on economic growth if the government raises taxes 
C)  How the wheat industry determines how much wheat to grow 
D)  The impact of labor unions on wages 
E)  The impact of higher prices for gasoline on the number of SUVs people buy 
A)  The pricing decisions in the computer hardware industry 
B)  The effect on economic growth if the government raises taxes 
C)  How the wheat industry determines how much wheat to grow 
D)  The impact of labor unions on wages 
E)  The impact of higher prices for gasoline on the number of SUVs people buy

Question 8

What is the difference between positive and normative statements?

Accepted Answer

Positive statements tell what is and nor

Question 9

If x increases whenever y decreases,then x and y are

Accepted Answer

A)  not related. 
B)  positively related. 
C)  directly related. 
D)  negatively related. 
E)  related but whether positively or negatively related depends on whether the x variable or the y variable is plotted on the vertical axis. 
A)  not related. 
B)  positively related. 
C)  directly related. 
D)  negatively related. 
E)  related but whether positively or negatively related depends on whether the x variable or the y variable is plotted on the vertical axis.

Question 10

When unskilled teens earn less than college graduates,society answers the ________ question.

Accepted Answer

A)  how 
B)  what 
C)  for whom 
D)  why 
E)  social interest versus self-interest 
A)  how 
B)  what 
C)  for whom 
D)  why 
E)  social interest versus self-interest

Question 11

In economics,cost is measured as ________,and benefit is measured as ________.

Accepted Answer

A)  what you must give up to get something; what you are willing to give up to get it 
B)  what you are willing to give up to get it; what you must give up to get something 
C)  the amount of money that you pay for something; the amount of money that someone else is willing to pay you 
D)  what you are willing to pay on the margin; what the government pays you when you are unemployed or retired 
E)  the amount of money that you pay on the margin; the amount of money that you receive on the margin 
A)  what you must give up to get something; what you are willing to give up to get it 
B)  what you are willing to give up to get it; what you must give up to get something 
C)  the amount of money that you pay for something; the amount of money that someone else is willing to pay you 
D)  what you are willing to pay on the margin; what the government pays you when you are unemployed or retired 
E)  the amount of money that you pay on the margin; the amount of money that you receive on the margin

Question 12

As part of its proposal to win the 2012 Olympics,London developed a carbon offset plan to reduce the Games' impact on the environment.In 2011,the organizers decided to drop this plan to reduce emissions.We can conclude that

Accepted Answer

A)  the marginal cost of reducing emissions exceeded the marginal benefits of reducing emissions. 
B)  the organizers are not making a rational decision. 
C)  the organizers are ignoring a sunk cost. 
D)  there are no incentives to reduce carbon emissions. 
E)  it is difficult to calculate the cost of reducing emissions. 
A)  the marginal cost of reducing emissions exceeded the marginal benefits of reducing emissions. 
B)  the organizers are not making a rational decision. 
C)  the organizers are ignoring a sunk cost. 
D)  there are no incentives to reduce carbon emissions. 
E)  it is difficult to calculate the cost of reducing emissions.

Question 13

-What is the slope of the line in the figure above?

Accepted Answer

A)  0.75 
B)  -0.75 
C)  1.33 
D)  -1.33 
E)  zero 
A)  0.75 
B)  -0.75 
C)  1.33 
D)  -1.33 
E)  zero

Question 14

We are investigating the relationship among three variables.We have graphed two of them.Suppose that the variable that is not measured on the x-axis or the y-axis changes.Then,there is

Accepted Answer

A)  a movement along the plotted curve. 
B)  a shift in the plotted curve. 
C)  no impact on the plotted curve because the variable is not measured on either of the axes. 
D)  an omitted variable. 
E)  a violation of the absence of trend assumption. 
A)  a movement along the plotted curve. 
B)  a shift in the plotted curve. 
C)  no impact on the plotted curve because the variable is not measured on either of the axes. 
D)  an omitted variable. 
E)  a violation of the absence of trend assumption.

Question 15

Which of the following BEST describes macroeconomics?

Accepted Answer

A)  It analyzes the aggregate effects on the national economy of the choices made by individuals, firms, and governments. 
B)  It studies the choices that individuals and businesses make when coping with scarcity. 
C)  It examines how the choices that individuals affect governments. 
D)  It is not a social science because its predictions cannot be tested. 
E)  Proving causation is never a problem for macroeconomics. 
A)  It analyzes the aggregate effects on the national economy of the choices made by individuals, firms, and governments. 
B)  It studies the choices that individuals and businesses make when coping with scarcity. 
C)  It examines how the choices that individuals affect governments. 
D)  It is not a social science because its predictions cannot be tested. 
E)  Proving causation is never a problem for macroeconomics.

Question 16

Which type of graph is most useful in determining if two variables are correlated?

Accepted Answer

A)  time-series 
B)  scatter diagram 
C)  cross-section 
D)  variable-correlation figure 
E)  None of the above answers is correct. 
A)  time-series 
B)  scatter diagram 
C)  cross-section 
D)  variable-correlation figure 
E)  None of the above answers is correct.

Question 17

-In the above,in which figure(s)is (are)the slope the same at every point?

Accepted Answer

A)  Figure A only 
B)  Figures A and C 
C)  Figure B only 
D)  Figures A, C, and D 
E)  Figures C and D 
A)  Figure A only 
B)  Figures A and C 
C)  Figure B only 
D)  Figures A, C, and D 
E)  Figures C and D

Question 18

What is the difference between a positive and a negative relationship?

Accepted Answer

Two variables are positively related whe

Question 19

-The figure above shows the relationship between the price of a dozen roses and the quantity of roses a florist can sell.The slope between points A and B is

Accepted Answer

A)  20. 
B)  16. 
C)  2. 
D)  4 
E)  nonexistent because at point A, no roses are sold. 
A)  20. 
B)  16. 
C)  2. 
D)  4 
E)  nonexistent because at point A, no roses are sold.

Question 20

Increasing income tax rates will solve the "Social Security time bomb issue" is an example of

Accepted Answer

A)  business economic policy. 
B)  a positive economic statement. 
C)  marginal cost exceeding marginal benefit. 
D)  answering the "how" question. 
E)  globalization. 
A)  business economic policy. 
B)  a positive economic statement. 
C)  marginal cost exceeding marginal benefit. 
D)  answering the "how" question. 
E)  globalization.

Which of the following is a positive statement?

What is the reason that all economic issues and problems occur?

-What is the slope of the line in the figure above?

The horizontal axis in a graph

What kind of information is conveyed in a time-series graph?

Which of the following is a topic studied in macroeconomics?

What is the difference between positive and normative statements?

If x increases whenever y decreases,then x and y are

When unskilled teens earn less than college graduates,society answers the ________ question.

In economics,cost is measured as ,and benefit is measured as .

As part of its proposal to win the 2012 Olympics,London developed a carbon offset plan to reduce the Games' impact on the environment.In 2011,the organizers decided to drop this plan to reduce emissions.We can conclude that

-What is the slope of the line in the figure above?

We are investigating the relationship among three variables.We have graphed two of them.Suppose that the variable that is not measured on the x-axis or the y-axis changes.Then,there is

Which of the following BEST describes macroeconomics?

Which type of graph is most useful in determining if two variables are correlated?

-In the above,in which figure(s)is (are)the slope the same at every point?

What is the difference between a positive and a negative relationship?

-The figure above shows the relationship between the price of a dozen roses and the quantity of roses a florist can sell.The slope between points A and B is

Increasing income tax rates will solve the "Social Security time bomb issue" is an example of

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 1: Getting Started

Which of the following is a positive statement?

What is the reason that all economic issues and problems occur?

-What is the slope of the line in the figure above?

The horizontal axis in a graph

What kind of information is conveyed in a time-series graph?

Which of the following is a topic studied in macroeconomics?

What is the difference between positive and normative statements?

If x increases whenever y decreases,then x and y are

When unskilled teens earn less than college graduates,society answers the ________ question.

In economics,cost is measured as ________,and benefit is measured as ________.

As part of its proposal to win the 2012 Olympics,London developed a carbon offset plan to reduce the Games' impact on the environment.In 2011,the organizers decided to drop this plan to reduce emissions.We can conclude that

-What is the slope of the line in the figure above?

We are investigating the relationship among three variables.We have graphed two of them.Suppose that the variable that is not measured on the x-axis or the y-axis changes.Then,there is

Which of the following BEST describes macroeconomics?

Which type of graph is most useful in determining if two variables are correlated?

-In the above,in which figure(s)is (are)the slope the same at every point?

What is the difference between a positive and a negative relationship?

-The figure above shows the relationship between the price of a dozen roses and the quantity of roses a florist can sell.The slope between points A and B is

Increasing income tax rates will solve the "Social Security time bomb issue" is an example of

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

In economics,cost is measured as ,and benefit is measured as .