Question 1

Define economics and describe its branches of study.

Accepted Answer

Economics is the social science that stu

Question 2

-In the above figure, a negative relationship is demonstrated in which of the graphs?

Accepted Answer

A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D 
A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  Figure D

Question 3

Which factor of production earns most income in the United States?

Accepted Answer

A)  capital 
B)  labor 
C)  money 
D)  entrepreneurship 
A)  capital 
B)  labor 
C)  money 
D)  entrepreneurship

Question 4

If there is an inverse relationship between two variables, the graph of this relationship

Accepted Answer

A)  will be a horizontal line. 
B)  will be downward-sloping. 
C)  might be horizontal. 
D)  will be upward-sloping. 
A)  will be a horizontal line. 
B)  will be downward-sloping. 
C)  might be horizontal. 
D)  will be upward-sloping.

Question 5

-The figure above shows how the sales of the video game "Tomb Raider-Lara Retires" change when the advertising spent on the game changes. Is the relationship between advertising and the number of games sold positive, negative, or neither? Explain your answer.

Accepted Answer

The figure shows that there is a positiv

Question 6

-In the figure above, ceteris paribus, an increase in x is associated with

Accepted Answer

A)  an increase in y. 
B)  a decrease in y. 
C)  a decrease in z. 
D)  None of the above answers is correct. 
A)  an increase in y. 
B)  a decrease in y. 
C)  a decrease in z. 
D)  None of the above answers is correct.

Question 7

Macroeconomics differs from microeconomics in that:

Accepted Answer

A)  macroeconomics studies the decisions of individuals. 
B)  microeconomics looks at the economy as a whole. 
C)  macroeconomics studies the behavior of government while microeconomics looks at private corporations. 
D)  macroeconomics focuses on the national economy and the global economy. 
A)  macroeconomics studies the decisions of individuals. 
B)  microeconomics looks at the economy as a whole. 
C)  macroeconomics studies the behavior of government while microeconomics looks at private corporations. 
D)  macroeconomics focuses on the national economy and the global economy.

Question 8

The slope of a line

Accepted Answer

A)  can never equal zero. 
B)  is always a constant. 
C)  measures the ratio of the change in the value of the y-axis variable relative to the change in the value of the x-axis variable. 
D)  measures the value of the y-axis variable relative to the value of the x-axis variable. 
A)  can never equal zero. 
B)  is always a constant. 
C)  measures the ratio of the change in the value of the y-axis variable relative to the change in the value of the x-axis variable. 
D)  measures the value of the y-axis variable relative to the value of the x-axis variable.

Question 9

-The slope of a curved line can be approximated by

Accepted Answer

A)  the average of the variable measured along the y-axis divided by the average of the variable measured along the x-axis. 
B)  the inverse of the straight-line method. 
C)  the average of the variable measured along the x-axis divided by the average of the variable measured along the y-axis. 
D)  the slope across an arc from one point on the curve to another point on the curve. 
A)  the average of the variable measured along the y-axis divided by the average of the variable measured along the x-axis. 
B)  the inverse of the straight-line method. 
C)  the average of the variable measured along the x-axis divided by the average of the variable measured along the y-axis. 
D)  the slope across an arc from one point on the curve to another point on the curve.

Question 10

According to economists,

Accepted Answer

A)  market capitalism is the best system available and some government intervention and regulation can either help or harm the social interest. 
B)  market capitalism is the best system available and any government intervention and regulation will inevitably harm the social interest. 
C)  centrally planned socialism is the best system available since governments generally make decisions that are in social interest. 
D)  centrally planned socialism and pure market capitalism are equally capable of promoting social interest, but a mixed economy is an undesirable compromise between the two that will harm social interest. 
A)  market capitalism is the best system available and some government intervention and regulation can either help or harm the social interest. 
B)  market capitalism is the best system available and any government intervention and regulation will inevitably harm the social interest. 
C)  centrally planned socialism is the best system available since governments generally make decisions that are in social interest. 
D)  centrally planned socialism and pure market capitalism are equally capable of promoting social interest, but a mixed economy is an undesirable compromise between the two that will harm social interest.

Question 11

-A positive relationship exists between two variables if

Accepted Answer

A)  one variable has "positively" no effect on the other variable. 
B)  a reduction in one variable is associated with an increase in the other variable. 
C)  a reduction in one variable is associated with a decrease in the other variable. 
D)  both variables are inflation-distorted. 
A)  one variable has "positively" no effect on the other variable. 
B)  a reduction in one variable is associated with an increase in the other variable. 
C)  a reduction in one variable is associated with a decrease in the other variable. 
D)  both variables are inflation-distorted.

Question 12

The opportunity cost of something you decide to get is

Accepted Answer

A)  all the possible alternatives that you give up to get it. 
B)  the highest valued alternative you give up to get it. 
C)  the value of the item minus the cost you paid for it. 
D)  the amount of money you pay to get it. 
A)  all the possible alternatives that you give up to get it. 
B)  the highest valued alternative you give up to get it. 
C)  the value of the item minus the cost you paid for it. 
D)  the amount of money you pay to get it.

Question 13

-On a graph, high correlation between the variable measured along the x-axis and the variable measured along the y-axis

Accepted Answer

A)  means that changes in the variable measured along the x-axis must cause changes in the variable measured along the y-axis. 
B)  means that changes in the variable measured along the y-axis must cause changes in the variable measured along the x-axis. 
C)  means that changes in either variable must cause changes in the other variable. 
D)  does NOT mean that a change in the variable measured along the x-axis must cause a change in the variable measured along the y-axis. 
A)  means that changes in the variable measured along the x-axis must cause changes in the variable measured along the y-axis. 
B)  means that changes in the variable measured along the y-axis must cause changes in the variable measured along the x-axis. 
C)  means that changes in either variable must cause changes in the other variable. 
D)  does NOT mean that a change in the variable measured along the x-axis must cause a change in the variable measured along the y-axis.

Question 14

In broad terms the difference between microeconomics and macroeconomics is that

Accepted Answer

A)  they use different sets of tools and ideas. 
B)  microeconomics studies decisions of individual people and firms and macroeconomics studies the entire national economy. 
C)  macroeconomics studies the effects of government regulation and taxes on the price of individual goods and services whereas microeconomics does not. 
D)  microeconomics studies the effects of government taxes on the national unemployment rate. 
A)  they use different sets of tools and ideas. 
B)  microeconomics studies decisions of individual people and firms and macroeconomics studies the entire national economy. 
C)  macroeconomics studies the effects of government regulation and taxes on the price of individual goods and services whereas microeconomics does not. 
D)  microeconomics studies the effects of government taxes on the national unemployment rate.

Question 15

Which of the following is NOT a factor of production?

Accepted Answer

A)  vans used by a bakery company for deliveries 
B)  a person developing a production schedule for a new product 
C)  175 shares of Microsoft stock 
D)  wilderness areas that have yet to be developed 
A)  vans used by a bakery company for deliveries 
B)  a person developing a production schedule for a new product 
C)  175 shares of Microsoft stock 
D)  wilderness areas that have yet to be developed

Question 16

Studying the determination of prices in individual markets is primarily a concern of

Accepted Answer

A)  positive economics. 
B)  negative economics. 
C)  macroeconomics. 
D)  microeconomics. 
A)  positive economics. 
B)  negative economics. 
C)  macroeconomics. 
D)  microeconomics.

Question 17

-In the figure above, when income equals $20,000, what does consumption equal?

Accepted Answer

A)  $0 
B)  $10,000 
C)  $20,000 
D)  impossible to tell 
A)  $0 
B)  $10,000 
C)  $20,000 
D)  impossible to tell

Question 18

-A graph measures y on the vertical axis and x on the horizontal. The curve on the graph is a vertical line. From this fact we know that

Accepted Answer

A)  the value of x does not change when the value of y changes. 
B)  the value of y is constant. 
C)  the ratio of x to y is constant. 
D)  the ratio of y to x is constant. 
A)  the value of x does not change when the value of y changes. 
B)  the value of y is constant. 
C)  the ratio of x to y is constant. 
D)  the ratio of y to x is constant.

Question 19

-In the above figure, the slope across the arc between a and b is

Accepted Answer

A)  1. 
B)  -4. 
C)  1/4. 
D)  -1/4. 
A)  1. 
B)  -4. 
C)  1/4. 
D)  -1/4.

Question 20

-If variables x and y move up and down together, they are

Accepted Answer

A)  positively related. 
B)  negative related. 
C)  unrelated. 
D)  trend related. 
A)  positively related. 
B)  negative related. 
C)  unrelated. 
D)  trend related.

Exam 1: What Is Economics

Define economics and describe its branches of study.

-In the above figure, a negative relationship is demonstrated in which of the graphs?

Which factor of production earns most income in the United States?

If there is an inverse relationship between two variables, the graph of this relationship

-The figure above shows how the sales of the video game "Tomb Raider-Lara Retires" change when the advertising spent on the game changes. Is the relationship between advertising and the number of games sold positive, negative, or neither? Explain your answer.

-In the figure above, ceteris paribus, an increase in x is associated with

Macroeconomics differs from microeconomics in that:

The slope of a line

-The slope of a curved line can be approximated by

According to economists,

-A positive relationship exists between two variables if

The opportunity cost of something you decide to get is

-On a graph, high correlation between the variable measured along the x-axis and the variable measured along the y-axis

In broad terms the difference between microeconomics and macroeconomics is that

Which of the following is NOT a factor of production?

Studying the determination of prices in individual markets is primarily a concern of

-In the figure above, when income equals $20,000, what does consumption equal?

-A graph measures y on the vertical axis and x on the horizontal. The curve on the graph is a vertical line. From this fact we know that

-In the above figure, the slope across the arc between a and b is

-If variables x and y move up and down together, they are

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices and Public Goods

Externalities and the Environment

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Extension A: Review

Extension B: Review

Extension C: Review

Extension D: Review

Extension E: Review

Extension F: Review

Filters