Exam 1: Getting Started

An economist observed that as more computers are added to a factory,the costs of production initially decline,reach a minimum,and then rise.In a diagram that has costs on the vertical axis and the number of computers on the horizontal axis,the relationship always is

A time-series graph measures

Wichita is building a convention center and financing it with revenues raised from a city hotel tax.Local politicians assert that the convention center is essentially free for Wichita residents because out-of-town visitors are paying for it.Someone who is practicing the economic way of thinking would disagree because

Because resources are scarce,economists would say that

Correlation means

The marginal benefit of an activity is i.the benefit from a one-unit increase in the activity. ii.the benefit of a small,unimportant activity. iii.measured by what the person is willing to give up to get one additional unit of the activity.

Explain whether the statement "The government should increase tariffs on Japanese cars to protect the American car industry from competition," is a normative or positive statement.