Deck 1: Introducing the Economic Way of Thinking

Question 1

Exhibit 1A-1  Straight line In Exhibit 1A-1, the slope of straight line AB is:

A) positive.
B) zero.
C) negative.
D) variable.

Answer 1

A

Question 2

Which of the following statements is correct?

A) Slope is the ratio of the vertical change (the rise or fall) to the horizontal change (the run).
B) A direct relationship is one in which two variables change in the same direction.
C) An inverse relationship is one in which two variables change in opposite directions.
D) An independent relationship is one in which two variables are unrelated.
E) All of the above.

Answer 2

E

Question 3

An upward-sloping line or curve is used to illustrate:

A) a direct relationship.
B) an inverse relationship.
C) two unrelated variables.
D) the ceteris paribus assumption.

Answer 3

A

Question 4

Suppose two variables are directly related. If one variable rises, then the other variable:

A) also rises.
B) falls.
C) remains unchanged.
D) reacts unpredictably.

Question 5

Exhibit 1A-2  Straight line In Exhibit 1A-2, as X increases along the horizontal axis, corresponding to points C-D on the line, the Y values increase. The relationship between the X and Y variables is:

A) direct.
B) inverse.
C) independent.
D) variable.

Question 6

Exhibit 1A-1  Straight line In Exhibit 1A-1, the slope of straight line AB is:

A) 1.
B) 5.
C) 1/2.
D) − 1.

Question 7

Exhibit 1A-2  Straight line Straight line CD in Exhibit 1A-2 shows that:

A) increasing values for X will increase the value of Y.
B) decreasing values for X will decrease the value of Y.
C) there is a direct relationship between X and Y.
D) all of the above.

Question 8

Which of the following is used to illustrate an independent relationship between two variables?

A) An upward-sloping curve
B) A downward-sloping curve
C) A hill-shaped curve
D) A horizontal or vertical line

Question 9

Exhibit 1A-1  Straight line As shown in Exhibit 1A-1, the slope of straight line AB:

A) decreases with increases in X.
B) increases with increases in X.
C) increases with decreases in X.
D) remains constant with changes in X.

Question 10

Which of the following pairs is the most likely to exhibit an inverse relationship?

A) The amount of time you study and your grade point average.
B) People's annual income and their expenditure on personal computers.
C) Baseball players' salaries and their batting averages.
D) The price of a concert and the number of tickets people purchase.

Question 11

When an inverse relationship is graphed, the resulting line or curve is:

A) horizontal.
B) vertical.
C) upward-sloping.
D) downward-sloping.

Question 12

Exhibit 1A-1  Straight line In Exhibit 1A-1, as X increases along the horizontal axis, corresponding to points A-B on the line, the Y values increase. The relationship between the X and Y variables is:

A) direct.
B) inverse.
C) independent.
D) variable.

Question 13

Exhibit 1A-1  Straight line Straight line AB in Exhibit 1A-1 shows that:

A) increasing values for X will decrease the values of Y.
B) decreasing values for X will increase the values of Y.
C) there is a direct relationship between X and Y.
D) all of the above.

Question 14

Which of the following pairs is the most likely to exhibit a direct relationship?

A) The price of gasoline and the amount of gasoline that people purchase.
B) Cholesterol levels and the likelihood of developing heart disease.
C) Outdoor temperature and heating oil sales.
D) Annual income and weekly pawn shop visits.

Question 15

A direct relationship exists when:

A) there is no association between two variables.
B) one variable increases and there is no change in the other variable.
C) one variable increases and the other variable increases.
D) one variable increases and the other variable decreases.

Question 16

A line that has a different slope at each point is a:

A) curve.
B) straight line.
C) vertical line.
D) horizontal line.

Question 17

What is used to illustrate an independent relationship between two variables?

A) An upward-sloping curve.
B) A downward-sloping curve.
C) A hill-shaped curve.
D) A horizontal or vertical line.

Question 18

A direct relationship is expressed graphically as a:

A) positively sloped line or curve.
B) negatively sloped line or curve.
C) horizontal line.
D) vertical line.

Question 19

Measured between two points on a curve, the ratio of the change in the variable on the vertical axis to the change in the variable on the horizontal axis is the:

A) axis.
B) slope.
C) dependent curve.
D) independent curve.

Question 20

An inverse relationship exists when:

A) there is no association between two variables.
B) one variable increases and there is no change in the other variable.
C) one variable increases and the other variable increases.
D) one variable increases and the other variable decreases.

Question 21

Exhibit 1A-5  Straight line Straight line CD in Exhibit 1A-5 shows that:

A) increasing values for X increases the value of Y.
B) decreasing values for X decreases the value of Y.
C) there is an inverse relationship between X and Y.
D) all of the above.

Question 22

Exhibit 1A-6  Straight line In Exhibit 1A-6, as X increases along the horizontal axis, corresponding to points A-D on the line, the Y values remain unchanged at 20 units. The relationship between the X and Y variables is:

A) direct.
B) inverse.
C) independent.
D) undefined.

Question 23

Exhibit 1A-4  Straight line In Exhibit 1A-4, as X increases along the horizontal axis, corresponding to points A-D on the line, the Y value remains unchanged at 40 units. The relationship between the X and Y variables is:

A) direct.
B) inverse.
C) independent.
D) undefined.

Question 24

Exhibit 1A-4  Straight line Straight line A-D in Exhibit 1A-4 shows that:

A) increasing value for X will increase the value of Y.
B) increasing value for X will decrease the value of Y.
C) increasing values for X do not affect the value of Y.
D) all of the above.

Question 25

Exhibit 1A-2  Straight line As shown in Exhibit 1A-2, the slope of straight line CD:

A) decreases with increases in X.
B) increases with increases in X.
C) increases with decreases in X.
D) remains constant with changes in X.

Question 26

Exhibit 1A-3  Straight line As shown in Exhibit 1A-3, the slope of straight line AB:

A) decreases with increases in X.
B) increases with increases in X.
C) increases with decreases in X.
D) remains constant with changes in X.

Question 27

Exhibit 1A-2  Straight line In Exhibit 1A-2, the slope of straight line CD is:

A) positive.
B) zero.
C) negative.
D) variable.

Question 28

Exhibit 1A-4  Straight line In Exhibit 1A-4, the slope of straight line A-D is:

A) positive.
B) zero.
C) negative.
D) variable.

Question 29

Exhibit 1A-3  Straight line In Exhibit 1A-3, the slope for straight line AB is:

A) 3.
B) 1.
C) − 1.
D) − 5.

Question 30

Exhibit 1A-6  Straight line In Exhibit 1A-6, the slope of straight line A-D is:

A) greater than 1.
B) equal to 1.
C) less than 1.
D) zero.

Question 31

Exhibit 1A-6  Straight line Straight line A-D in Exhibit 1A-6 shows that:

A) increasing value for X will increase the value of Y.
B) increasing value for X will decrease the value of Y.
C) increasing values for X does not affect the value of Y.
D) all of the above.

Question 32

Exhibit 1A-3  Straight line In Exhibit 1A-3, as X increases along the horizontal axis, corresponding to points A-B on the line, the Y values decrease. The relationship between the X and Y variables is:

A) direct.
B) inverse.
C) independent.
D) variable.

Question 33

Exhibit 1A-5  Straight line In Exhibit 1A-5, the slope for straight line CD is:

A) 5.
B) 1.
C) − 1.
D) − 5.

Question 34

Exhibit 1A-4  Straight line In Exhibit 1A-4, the slope of the straight line A-D is:

A) 0.
B) 1.
C) 1/2.
D) − 1.

Question 35

Exhibit 1A-3  Straight line Straight line AB in Exhibit 1A-3 shows that:

A) increasing values for X reduces the value of Y.
B) decreasing values for X increases the value of Y.
C) there is an inverse relationship between X and Y.
D) all of the above.

Question 36

Exhibit 1A-5  Straight line In Exhibit 1A-5, the slope of straight line CD is:

A) positive.
B) zero.
C) negative.
D) variable.

Question 37

Exhibit 1A-5  Straight line In Exhibit 1A-5, as X increases along the horizontal axis, corresponding to points C-D on the line, the Y values decrease. The relationship between the X and Y variables is:

A) direct.
B) inverse.
C) independent.
D) variable.

Question 38

Exhibit 1A-5  Straight line As shown in Exhibit 1A-5, the slope of straight line CD:

A) decreases with increases in X.
B) increases with increases in X.
C) increases with decreases in X.
D) remains constant with changes in X.

Question 39

Exhibit 1A-2  Straight line In Exhibit 1A-2, the slope of straight line CD is:

A) 3.
B) 1.
C) − 1.
D) 1/2.

Question 40

Exhibit 1A-3  Straight line In Exhibit 1A-3, the slope of straight line AB is:

A) positive.
B) zero.
C) negative.
D) variable.

Question 41

If two variables are inversely related, then they change in the same direction.

Question 42

A change in a third variable not on either axis of a graph is illustrated with a:

A) horizontal or vertical line.
B) movement along a curve.
C) shift of a curve.
D) point of intersection.

Question 43

A shift in a curve represents a change in:

A) the variable on the horizontal axis.
B) the variable on the vertical axis.
C) a third variable that is not on either axis.
D) any variable that is relevant to the relationship being graphed.

Question 44

Exhibit 1A-7  Straight line relationship According to Exhibit 1A-7, the relationship between annual income and air-travel expenditures is:

A) direct.
B) inverse.
C) complex.
D) independent.

Question 45

Exhibit 1A-6  Straight line In Exhibit 1A-6, the slope of straight line A-D is:

A) positive.
B) zero.
C) negative.
D) variable.

Question 46

Exhibit 1A-6  Straight line In Exhibit 1A-6, the slope of the straight line A-D is:

A) 0.
B) 1.
C) 1/2.
D) − 1.

Question 47

A graph is one method of expressing a model.

Question 48

Exhibit 1A-7  Straight line relationship Which of the following would cause a shift in the relationship shown in Exhibit 1A-7?

A) A rise in people's annual income.
B) A rise in people's expenditure on air travel.
C) A rise in the price of air travel.
D) All of the above would shift the line in the graph.

Question 49

A downward-sloping straight line exhibits a direct relationship between two variables.

Question 50

An upward-sloping straight line exhibits a direct relationship between two variables.

Question 51

A two-dimensional graph can only represent the relationship between two variables.

Question 52

Exhibit 1A-8  Straight line relationship Which of the following would cause a shift in the relationship shown in Exhibit 1A-8?

A) A fall in household incomes.
B) A fall in the price of pizza.
C) A fall in the quantity of pizza that people wish to purchase.
D) All of the above would shift the line in the graph.

Question 53

In a graphic relationship, shifts in a curve are caused by a change in:

A) the slope of the curve.
B) a factor not measured on the axes of the graph.
C) one of the factors measured on either axes of the graph.
D) any factor, whether measured on the axes of the graph of not.

Question 54

Exhibit 1A-7  Straight line relationship What is the slope of the line shown in Exhibit 1A-7?

A) 1/20.
B) 1/10.
C) 1/5.
D) 1/2.

Question 55

Exhibit 1A-10  Multi-curve graph Exhibit 1A-10 represents a three-variable relationship. As the annual income of consumers rises from $20,000 (line A) to $40,000 (line B), the result is a(n):

A) rightward movement along each curve.
B) leftward movement along each curve.
C) leftward shift in curve B to curve A.
D) leftward shift in curve A to curve B.

Question 56

Exhibit 1A-8  Straight line relationship What is the slope of the line shown in Exhibit 1A-8?

A) − 1.
B) − 1/2.
C) − 1/4.
D) 0.

Question 57

Exhibit 1A-8  Straight line relationship According to the Exhibit 1A-8, the relationship between the price and quantity purchased of pizza is:

A) direct.
B) inverse.
C) complex.
D) independent.

Question 58

Direct relationships are illustrated using upward-sloping lines and curves.

Question 59

The graph of a direct relationship will have a positive slope.

Question 60

Exhibit 1A-9  Multi-curve graph Exhibit 1A-9 represents a three-variable relationship. As the annual income of consumers falls from $50,000 (line A) to $30,000 (line B), the result is a(n):

A) rightward movement along each curve.
B) leftward movement along each curve.
C) leftward shift in curve A to curve B.
D) rightward shift in curve A to curve B.

Question 61

When economists say scarcity, they mean:

A) there are only a limited number of consumers who would be interested in purchasing goods.
B) the human desire for goods exceeds the available supply of time, goods and resources.
C) most people in poorer countries do not have enough goods.
D) goods are so expensive that only the rich can afford it.

Question 62

A downward-sloping line has a negative slope.

Question 63

When economists say goods are scarce, they mean:

A) consumers are too poor to afford the goods and services available.
B) consumers are unwilling to buy goods unless they have very low prices.
C) goods are generally freely available from nature in most countries.
D) the desire for goods and services exceeds our ability to produce them with the limited resources available.

Question 64

Scarcity:

A) exists because resources are unlimited while human wants are limited.
B) means we are unable to have as much as we would like to have.
C) will likely be eliminated as technology continues to expand.
D) is not an issue addressed in economics.

Question 65

The slope of a line is calculated as the ratio of the "rise" over the "run".

Question 66

A graph can be used to illustrate the relationship between the price of compact discs and the quantity of compact discs demanded. If there is evidence that buyers' income also influences the demand for compact discs, then a movement along the curve can be caused by a change in the price of compact discs.

Question 67

Distinguish a direct and an inverse or negative relationship. Provide an example of each type of relationship.

Question 68

Two variables that are inversely related tend to move in opposite directions.

Question 69

Scarcity can be eliminated if:

A) people satisfy needs rather than wants.
B) sufficient new resources were discovered.
C) output of goods and services were increased.
D) none of the above.

Question 70

Which of the following illustrates the concept of scarcity?

A) There is usually more than one use of your "free" time in the evening.
B) More clean air is wanted than is available in large polluted metropolitan areas such as Los Angeles.
C) There are many competing uses for the annual budget of your city, county, or state.
D) All of the answers are correct.

Question 71

Scarcity is a(n):

A) problem only in industrialized economies.
B) condition measured by the quantity of goods available.
C) subjective concept that human wants can never be satisfied.
D) problem only in poor economies.

Question 72

A straight line or curve can shift when a factor not included on the vertical axis or horizontal axis changes.

Question 73

Scarcity is a problem:

A) measured by the amount of goods available.
B) of the poor, but not the rich.
C) because human wants are unlimited while resources are limited.
D) only in industrialized economies.

Question 74

The condition of scarcity:

A) cannot be eliminated.
B) prevails in poor economies.
C) prevails in rich economies.
D) All of the above.

Question 75

Because of scarcity,

A) ​it is impossible to satisfy every desire and choices must be made.
B) ​the available supply of time, goods, and resources is greater than human wants.
C) ​every desire is fulfilled.
D) ​there are no limits on the economy's ability to satisfy unlimited wants.

Question 76

Which of the following would eliminate scarcity as an economic problem?

A) Moderation of people's competitive instincts.
B) Discovery of sufficiently large new energy reserves.
C) Resumption of steady productivity growth.
D) None of the above.

Question 77

The finite nature of the economy's resource base:

A) will be solved if only we would learn to conserve.
B) is only a problem in developing countries.
C) will be solved as technology advances.
D) will always be with us.

Question 78

A horizontal line has an infinite slope.

Question 79

A horizontal line represents an independent relationship.

Question 80

Graphically express a direct and an inverse or negative relationship. What could cause a shift in a line or curve expressing a relationship between two variables?