Question 1

-If two variables are positively related, then

Accepted Answer

A)  they move in opposite directions. 
B)  they are independent of each other. 
C)  they move in the same direction. 
D)  their graph will have a negative slope. 
A)  they move in opposite directions. 
B)  they are independent of each other. 
C)  they move in the same direction. 
D)  their graph will have a negative slope.

Question 2

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 statement is normative. Th

Question 3

-In the above figure, which of the graphs demonstrates a curve with a decreasing slope, that is, a slope getting smaller in magnitude as x increases?

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 4

Opportunity cost is best defined as

Accepted Answer

A)  how much money is paid for something. 
B)  how much money is paid for something, taking inflation into account. 
C)  the highest-valued alternative that is given up to get something. 
D)  all the alternatives that are given up to get something. 
A)  how much money is paid for something. 
B)  how much money is paid for something, taking inflation into account. 
C)  the highest-valued alternative that is given up to get something. 
D)  all the alternatives that are given up to get something.

Question 5

Scarcity is a situation in which

Accepted Answer

A)  people cannot satisfy all their wants. 
B)  most people can get only bare necessities. 
C)  people can satisfy all their wants. 
D)  some people can get all they want and some cannot. 
A)  people cannot satisfy all their wants. 
B)  most people can get only bare necessities. 
C)  people can satisfy all their wants. 
D)  some people can get all they want and some cannot.

Question 6

-The above table indicates that variables x and y are

Accepted Answer

A)  positively related. 
B)  inversely related. 
C)  negatively related. 
D)  not related. 
A)  positively related. 
B)  inversely related. 
C)  negatively related. 
D)  not related.

Question 7

Macroeconomic topics include

Accepted Answer

A)  total, nationwide employment. 
B)  studying what factors influence the price and quantity of automobiles. 
C)  studying the determination of wages and production costs in the software industry. 
D)  the impact of government regulation of markets. 
A)  total, nationwide employment. 
B)  studying what factors influence the price and quantity of automobiles. 
C)  studying the determination of wages and production costs in the software industry. 
D)  the impact of government regulation of markets.

Question 8

Samantha goes to college to become an engineer. This is an example of an

Accepted Answer

A)  investment in physical capital. 
B)  investment in human capital. 
C)  increase in entrepreneurship. 
D)  increase in labor. 
A)  investment in physical capital. 
B)  investment in human capital. 
C)  increase in entrepreneurship. 
D)  increase in labor.

Question 9

You decide to take a vacation and the trip costs you $2,000. While you are on vacation, you do not go to work where you could have earned $750. In terms of dollars, the opportunity cost of the vacation is

Accepted Answer

A)  $2,000. 
B)  $750. 
C)  $2,750. 
D)  $1,250 
A)  $2,000. 
B)  $750. 
C)  $2,750. 
D)  $1,250

Question 10

A scatter diagram plots the value of one economic variable against time.

Accepted Answer

A) True 
 B)False

Question 11

When a California farmer decides to harvest lettuce using machines instead of by migrant workers, the farmer is answering the ________ part of one of the two big economic questions.

Accepted Answer

A)  "how" 
B)  "for whom" 
C)  "scarcity" 
D)  "what" 
A)  "how" 
B)  "for whom" 
C)  "scarcity" 
D)  "what"

Question 12

A benefit from an increase in activity is called the

Accepted Answer

A)  marginal benefit. 
B)  economic benefit. 
C)  total benefit. 
D)  opportunity benefit. 
A)  marginal benefit. 
B)  economic benefit. 
C)  total benefit. 
D)  opportunity benefit.

Question 13

People must make choices because

Accepted Answer

A)  most people enjoy shopping. 
B)  of scarcity. 
C)  there are many goods available. 
D)  None of the above answers is correct. 
A)  most people enjoy shopping. 
B)  of scarcity. 
C)  there are many goods available. 
D)  None of the above answers is correct.

Question 14

-In the above figure, a negative relationship between price and quantity is shown in

Accepted Answer

A)  Figure A. 
B)  Figure B. 
C)  Both Figure A and Figure B. 
D)  Neither Figure A nor Figure B. 
A)  Figure A. 
B)  Figure B. 
C)  Both Figure A and Figure B. 
D)  Neither Figure A nor Figure B.

Question 15

The statement "Managers with a college education earn $18 an hour while ski instructors who did not complete college earn $10" is

Accepted Answer

A)  a political statement. 
B)  a positive statement. 
C)  a normative statement. 
D)  an ethical statement. 
A)  a political statement. 
B)  a positive statement. 
C)  a normative statement. 
D)  an ethical statement.

Question 16

-The slope of the line shown in the above figure is

Accepted Answer

A)  -1/3. 
B)  -5. 
C)  -1. 
D)  -3. 
A)  -1/3. 
B)  -5. 
C)  -1. 
D)  -3.

Question 17

An economic model is

Accepted Answer

A)  a generalization that summarizes all the normative assumptions we make about a particular issue. 
B)  a description of some aspect of the economic world that includes only those features of the world that are needed for the purpose at hand. 
C)  a statement that describes how the world should be. 
D)  a collection of facts that describe the real world. 
A)  a generalization that summarizes all the normative assumptions we make about a particular issue. 
B)  a description of some aspect of the economic world that includes only those features of the world that are needed for the purpose at hand. 
C)  a statement that describes how the world should be. 
D)  a collection of facts that describe the real world.

Question 18

When the president of the Bank of America addresses Congress regarding lending standards in that industry, he is discussing

Accepted Answer

A)  a macroeconomic topic. 
B)  a microeconomic topic. 
C)  incentives. 
D)  the big tradeoff. 
A)  a macroeconomic topic. 
B)  a microeconomic topic. 
C)  incentives. 
D)  the big tradeoff.

Question 19

What is the difference between a positive and a negative relationship?

Accepted Answer

Two variables are positively related whe

Question 20

-In the above figure, the relationship between the tax rate and tax revenue is positive and becoming less steep between tax rates of

Accepted Answer

A)  0 percent and 30 percent. 
B)  30 percent and 100 percent. 
C)  0 percent and 100 percent. 
D)  None of the above answers are correct. 
A)  0 percent and 30 percent. 
B)  30 percent and 100 percent. 
C)  0 percent and 100 percent. 
D)  None of the above answers are correct.

Exam 1: What Is Economics

-If two variables are positively related, then

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.

-In the above figure, which of the graphs demonstrates a curve with a decreasing slope, that is, a slope getting smaller in magnitude as x increases?

Opportunity cost is best defined as

Scarcity is a situation in which

-The above table indicates that variables x and y are

Macroeconomic topics include

Samantha goes to college to become an engineer. This is an example of an

You decide to take a vacation and the trip costs you $2,000. While you are on vacation, you do not go to work where you could have earned $750. In terms of dollars, the opportunity cost of the vacation is

A scatter diagram plots the value of one economic variable against time.

When a California farmer decides to harvest lettuce using machines instead of by migrant workers, the farmer is answering the ________ part of one of the two big economic questions.

A benefit from an increase in activity is called the

People must make choices because

-In the above figure, a negative relationship between price and quantity is shown in

The statement "Managers with a college education earn $18 an hour while ski instructors who did not complete college earn $10" is

-The slope of the line shown in the above figure is

An economic model is

When the president of the Bank of America addresses Congress regarding lending standards in that industry, he is discussing

What is the difference between a positive and a negative relationship?

-In the above figure, the relationship between the tax rate and tax revenue is positive and becoming less steep between tax rates of

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

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