Question 1

Exhibit 1-2   In Exhibit 1-2, when y is greater than 12, the

Accepted Answer

A) value of x is larger on curve A than on curve B 
B) value of x is smaller on curve A than on curve B 
C) value of x is the same on curve A as on curve B 
D) slope of line A is negative 
E) slope of line B is positive 
A) value of x is larger on curve A than on curve B 
B) value of x is smaller on curve A than on curve B 
C) value of x is the same on curve A as on curve B 
D) slope of line A is negative 
E) slope of line B is positive

Question 2

Exhibit 1-3   In Exhibit 1-3, for any value of y, the

Accepted Answer

A) value of x is larger on curve A than on curve B 
B) value of x is smaller on curve A than on curve B 
C) value of x is the same on curve A as on curve B 
D) slope of line A is increasing 
E) slope of line B is negative 
A) value of x is larger on curve A than on curve B 
B) value of x is smaller on curve A than on curve B 
C) value of x is the same on curve A as on curve B 
D) slope of line A is increasing 
E) slope of line B is negative

Question 3

Exhibit 1-2   In Exhibit 1-2, when x is greater than 10, the

Accepted Answer

A) value of y is larger on curve A than on curve B 
B) value of y is smaller on curve A than on curve B 
C) value of y is the same on curve A as on curve B 
D) slope of line A is negative 
E) slope of line B is positive 
A) value of y is larger on curve A than on curve B 
B) value of y is smaller on curve A than on curve B 
C) value of y is the same on curve A as on curve B 
D) slope of line A is negative 
E) slope of line B is positive

Question 4

Exhibit 1-1   In Exhibit 1-1 the movement from point b to point c represents

Accepted Answer

A) an increase in x of 30 units and an increase in y of 10 units 
B) an increase in x of 10 units and an increase in y of 30 units 
C) an increase in x of 60 units and a decrease in y of 20 units 
D) an increase in x of 20 units and a decrease in y of 60 units 
E) an increase in x of 20 units and a decrease in y of 30 units 
A) an increase in x of 30 units and an increase in y of 10 units 
B) an increase in x of 10 units and an increase in y of 30 units 
C) an increase in x of 60 units and a decrease in y of 20 units 
D) an increase in x of 20 units and a decrease in y of 60 units 
E) an increase in x of 20 units and a decrease in y of 30 units

Question 5

The part of a graph that is most applicable to marginal analysis is the

Accepted Answer

A) origin 
B) slope 
C) horizontal axis 
D) dependent variable 
E) inverse relation 
A) origin 
B) slope 
C) horizontal axis 
D) dependent variable 
E) inverse relation

Question 6

If the dependent variable Y is directly related to the independent variable X, this means that changes in X cause changes in Y.

Accepted Answer

A) True 
 B)False

Question 7

Exhibit 1-1   In Exhibit 1-1 the movement from point a to point c represents

Accepted Answer

A) an increase in x of 30 units and an increase in y of 10 units 
B) an increase in x of 10 units and an increase in y of 30 units 
C) an increase in x of 60 units and a decrease in y of 20 units 
D) an increase in x of 20 units and a decrease in y of 60 units 
E) an increase in x of 20 units and a decrease in y of 30 units 
A) an increase in x of 30 units and an increase in y of 10 units 
B) an increase in x of 10 units and an increase in y of 30 units 
C) an increase in x of 60 units and a decrease in y of 20 units 
D) an increase in x of 20 units and a decrease in y of 60 units 
E) an increase in x of 20 units and a decrease in y of 30 units

Question 8

Exhibit 1-16           Refer to exhibit 1-16.Which of the graphs illustrates a direct or positive relationship between variable X and variable Y?

Accepted Answer

A) a 
B) b 
C) c 
D) d 
E) e 
A) a 
B) b 
C) c 
D) d 
E) e

Question 9

Exhibit 1-8   The slope of the line in Exhibit 1-8 is

Accepted Answer

A) 0.1 
B) 1 
C) 10 
D) -0.1 
E) -10 
A) 0.1 
B) 1 
C) 10 
D) -0.1 
E) -10

Question 10

Exhibit 1-2   In Exhibit 1-2, at x = 10, the

Accepted Answer

A) value of y is larger on curve A than on curve B 
B) value of y is smaller on curve A than on curve B 
C) value of y is the same on curve A as on curve B 
D) slope of line A is negative 
E) slope of line B is positive 
A) value of y is larger on curve A than on curve B 
B) value of y is smaller on curve A than on curve B 
C) value of y is the same on curve A as on curve B 
D) slope of line A is negative 
E) slope of line B is positive

Question 11

The slope of a horizontal line is

Accepted Answer

A) infinitely large 
B) zero 
C) positive 
D) negative 
E) infinitely small 
A) infinitely large 
B) zero 
C) positive 
D) negative 
E) infinitely small

Question 12

Exhibit 1-4   Which of the following must be true of line D in Exhibit 1-4?

Accepted Answer

A) A decrease in P is associated with a decrease in Q. 
B) An increase in P is associated with an increase in Q. 
C) There is no relation between P and Q. 
D) There is an inverse relationship between P and Q. 
E) There is a direct relationship between P and Q. 
A) A decrease in P is associated with a decrease in Q. 
B) An increase in P is associated with an increase in Q. 
C) There is no relation between P and Q. 
D) There is an inverse relationship between P and Q. 
E) There is a direct relationship between P and Q.

Question 13

Exhibit 1-3   In Exhibit 1-3, for any value of x, the

Accepted Answer

A) value of y is larger on curve A than on curve B 
B) value of y is smaller on curve A than on curve B 
C) value of y is the same on curve A as on curve B 
D) slope of line A is increasing 
E) slope of line B is negative 
A) value of y is larger on curve A than on curve B 
B) value of y is smaller on curve A than on curve B 
C) value of y is the same on curve A as on curve B 
D) slope of line A is increasing 
E) slope of line B is negative

Question 14

The slope of a steep upward-sloping line is a smaller value than the slope of a nearly flat upward-sloping line.

Accepted Answer

A) True 
 B)False

Question 15

One economic application of the slope of a line is

Accepted Answer

A) measuring unlimited wants 
B) behavioral analysis 
C) marginal analysis 
D) allocative efficiency 
E) rational self-interest 
A) measuring unlimited wants 
B) behavioral analysis 
C) marginal analysis 
D) allocative efficiency 
E) rational self-interest

Question 16

The slope of a line

Accepted Answer

A) can only be calculated for straight lines 
B) varies at different points along a straight line 
C) indicates whether or not there is a causal relationship between variables 
D) is independent of the units of measurement used 
E) indicates how much the vertical variable changes for a given change in the horizontal variable 
A) can only be calculated for straight lines 
B) varies at different points along a straight line 
C) indicates whether or not there is a causal relationship between variables 
D) is independent of the units of measurement used 
E) indicates how much the vertical variable changes for a given change in the horizontal variable

Question 17

A curved line may have a positive slope or a negative slope, but it cannot have both positive and negative areas of slope.

Accepted Answer

A) True 
 B)False

Question 18

A functional relationship exists between two variables if the value of one variable depends on the value of the other variable.

Accepted Answer

A) True 
 B)False

Question 19

Exhibit 1-15   Refer to Exhibit 1-15.The reason that Line (a)would shift to the position of Line (b)is

Accepted Answer

A) a change in quantity 
B) a change in price 
C) a change in an assumption about the relationship between the two variables observed 
D) a change from a positive relation to a negative relation 
E) a change from a negative relation to a positive relation 
A) a change in quantity 
B) a change in price 
C) a change in an assumption about the relationship between the two variables observed 
D) a change from a positive relation to a negative relation 
E) a change from a negative relation to a positive relation

Question 20

The slope of a vertical line is

Accepted Answer

A) infinitely large 
B) zero 
C) positive 
D) negative 
E) infinitely small 
A) infinitely large 
B) zero 
C) positive 
D) negative 
E) infinitely small

Exam 1: Appendix--Understanding Graphs

Exhibit 1-2 In Exhibit 1-2, when y is greater than 12, the

Exhibit 1-3 In Exhibit 1-3, for any value of y, the

Exhibit 1-2 In Exhibit 1-2, when x is greater than 10, the

Exhibit 1-1 In Exhibit 1-1 the movement from point b to point c represents

The part of a graph that is most applicable to marginal analysis is the

If the dependent variable Y is directly related to the independent variable X, this means that changes in X cause changes in Y.

Exhibit 1-1 In Exhibit 1-1 the movement from point a to point c represents

Exhibit 1-16 Refer to exhibit 1-16.Which of the graphs illustrates a direct or positive relationship between variable X and variable Y?

Exhibit 1-8 The slope of the line in Exhibit 1-8 is

Exhibit 1-2 In Exhibit 1-2, at x = 10, the

The slope of a horizontal line is

Exhibit 1-4 Which of the following must be true of line D in Exhibit 1-4?

Exhibit 1-3 In Exhibit 1-3, for any value of x, the

The slope of a steep upward-sloping line is a smaller value than the slope of a nearly flat upward-sloping line.

One economic application of the slope of a line is

The slope of a line

A curved line may have a positive slope or a negative slope, but it cannot have both positive and negative areas of slope.

A functional relationship exists between two variables if the value of one variable depends on the value of the other variable.

Exhibit 1-15 Refer to Exhibit 1-15.The reason that Line (a)would shift to the position of Line (b)is

The slope of a vertical line is

The Art and Science of Economic Analysis

Economic Tools and Economics Systems

Economic Decision Makers

Demand, Supply, and Markets

Elasticity of Demand and Supply

Appendix--Price Elasticity and Tax Incidence

Consumer Choice and Demand

Appendix--Indifference Curves and Utility Maximization

Production and Cost in the Firm

A--Perfect Competition

B--Perfect Competition

A--Monopoly

B--Monopoly

Monopolistic Competition and Oligopoly

Resource Markets

Labor Markets and Labor Unions

Capital, Interest, and Corporate Finance

Transaction Costs, Imperfect Information, and Behavioral Economics

Economic Regulation and Antitrust Policy

Public Goods and Public Choice

Externalities and the Environment

Income Distribution and Poverty

International Trade

International Finance

Economic Development

Filters