Question 1

Which of the following is a normative statement?

Accepted Answer

A)  Flood victims should pay for their own rebuilding. 
B)  When the price of kiwi fruit increases, fewer people eat kiwi fruit. 
C)  An increase in the supply of computers has caused computer prices to fall. 
D)  Recessions lead to increases in the unemployment rate. 
E)  Hurricanes strike mainly Florida and North Carolina.

Question 2

Which of the following is a microeconomic topic?

Accepted Answer

A)  Northwest Airlines analyzes the benefits of adding one more flight to Salt Lake City. 
B)  Unemployment soars as taxes increase. 
C)  The government leaves interest rates unchanged as the economy improves. 
D)  Germany's government increases taxes to avoid a budget deficit. 
E)  Chinese economic growth slows.

Question 3

What is an opportunity cost? Give an example.

Accepted Answer

The answer of What is an opportunity cost? Give an...

Question 4

Of the three major economic questions,which of the following is the best example of a "How?" question?

Accepted Answer

A)  Should we produce more heavy fleece coats? 
B)  Should we collect tolls on turnpikes using human toll collectors or mechanized toll machines? 
C)  Should we build log homes or build factories from bricks? 
D)  Should we spend more on health care? 
E)  Should we eat more oatmeal?

Question 5

Which of the following is a macroeconomic issue?

Accepted Answer

A)  The price of a ticket to Walt Disney World in Orlando is increased. 
B)  The National Football League signs a new television contract. 
C)  The number of jobs and production in Zimbabwe increase. 
D)  The Iowa corn harvest is smaller than normal. 
E)  Utilities are required to install more anti-pollution devices.

Question 6

-What does the slope of the line shown in the above figure equal?

Accepted Answer

The answer of 
-What does the slope of the line...

Question 7

Which of the following statements is correct?

Accepted Answer

A)  When a line slopes downwards moving to the right, the variable measured on the x-axis and the variable measured on the y-axis are directly related. 
B)  When a line slopes upwards moving to the right, the variable measured on the x-axis and the variable measured on the y-axis are directly related. 
C)  The higher the temperature, the more ice cream people consume. Thus the temperature and ice cream consumption are inversely related. 
D)  If two variables are directly related, a graph of the two variables has a negative slope. 
E)  None of the above statements are correct.

Question 8

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.

Question 9

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

Question 10

Which of the following statements is correct?

Accepted Answer

A)  The slope of a straight line changes depending where on the line it is calculated. 
B)  The slope of a curved line is not defined because it is impossible to calculate the slope along a curved line. 
C)  A straight line that slopes upward moving to the right has a positive slope. 
D)  Answers A and B are correct. 
E)  Answers A and C are correct.

Question 11

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.

Accepted Answer

The answer of Explain whether the statement "The government should...

Question 12

A time series graph reveals whether there is a ________ ,which represents ________.

Accepted Answer

A)  trend in a variable; a general tendency for the variable to rise or fall 
B)  relationship between two variables; a cross-section relationship 
C)  trends in two variables; unrelated variables 
D)  relationship between two variables; a trend in a variable 
E)  cross-section relationship; a general tendency for the variables to rise or fall

Question 13

What are the two different types of relationships that variables can have? Explain each.What do these relationships look like when they are graphed?

Accepted Answer

The answer of What are the two different types of...

Question 14

Which of the following best defines economics?

Accepted Answer

A)  Economics teaches how to limit our wants. 
B)  Economics studies how to choose the best alternative when coping with scarcity. 
C)  Economics helps you earn as much money as possible. 
D)  Economics analyzes all aspects of human behavior in general. 
E)  Economics is concerned with prices and quantities of goods and services, both at the individual level and at the industry level.

Question 15

Scarcity forces people to

Accepted Answer

A)  choose among available alternatives. 
B)  cheat and steal. 
C)  be unwilling to help others. 
D)  live at a low standard of living. 
E)  consume as much as they can as quickly as they can.

Question 16

As the price of home heating oil rises,families buy less home heating oil.Hence a scatter diagram with the price of home heating oil on the vertical axis and the quantity purchased on the horizontal axis reveals a ________ relationship.

Accepted Answer

A)  positive 
B)  linear 
C)  time-series 
D)  negative 
E)  cross-sectional

Question 17

"The change in the value of the variable measured on the y-axis divided by the change in the value of the variable measured on the x-axis" is the definition of

Accepted Answer

A)  a graph. 
B)  slope. 
C)  a curve. 
D)  a relationship. 
E)  a trend.

Question 18

As a person increases his or her caloric intake,the person's weight increases,ceteris paribus.The relationship between the person's caloric intake and the person's weight is an example of

Accepted Answer

A)  unrelated variables. 
B)  a positive relationship. 
C)  a negative relationship. 
D)  a single point on a graph. 
E)  a trended relationship.

Question 19

If a curve falls and then rises,it

Accepted Answer

A)  has a maximum. 
B)  has a minimum. 
C)  has a linear relationship. 
D)  has a constant slope relationship. 
E)  shows no relationship between the two variables.

Question 20

-The figure above shows the relationship between the time a student spends studying and the student's GPA that semester.The slope of the relationship at point A ________ the slope at point B.

Accepted Answer

A)  is greater than 
B)  is less than 
C)  is equal to 
D)  cannot be compared to 
E)  can be compared but more information is needed to determine whether the slope is greater than, less than, or equal to

Exam 1: Getting Started

Which of the following is a normative statement?

Which of the following is a microeconomic topic?

What is an opportunity cost? Give an example.

Of the three major economic questions,which of the following is the best example of a "How?" question?

Which of the following is a macroeconomic issue?

-What does the slope of the line shown in the above figure equal?

Which of the following statements is correct?

Increasing income tax rates will solve the "social security time bomb issue" is an example of

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

Which of the following statements is correct?

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.

A time series graph reveals whether there is a ,which represents .

What are the two different types of relationships that variables can have? Explain each.What do these relationships look like when they are graphed?

Which of the following best defines economics?

Scarcity forces people to

As the price of home heating oil rises,families buy less home heating oil.Hence a scatter diagram with the price of home heating oil on the vertical axis and the quantity purchased on the horizontal axis reveals a ________ relationship.

"The change in the value of the variable measured on the y-axis divided by the change in the value of the variable measured on the x-axis" is the definition of

As a person increases his or her caloric intake,the person's weight increases,ceteris paribus.The relationship between the person's caloric intake and the person's weight is an example of

If a curve falls and then rises,it

-The figure above shows the relationship between the time a student spends studying and the student's GPA that semester.The slope of the relationship at point A ________ the slope at point B.