Question 1

Normative statements are statements about

Accepted Answer

A)  prices. 
B)  quantities. 
C)  what is. 
D)  what ought to be. 
A)  prices. 
B)  quantities. 
C)  what is. 
D)  what ought to be.

Question 2

-In the above figure, using the slope across an arc, the slope of the curve between points a and c is

Accepted Answer

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

Question 3

A graph shows that as fees to use ATM machines increase, people use them less frequently. The graph of this relationship would show

Accepted Answer

A)  an inverse relationship. 
B)  a negative relationship. 
C)  a direct relationship. 
D)  Both answers A and B are correct. 
A)  an inverse relationship. 
B)  a negative relationship. 
C)  a direct relationship. 
D)  Both answers A and B are correct.

Question 4

If a large change in the variable measured on the x-axis is associated with a small change of the variable measured on the y-axis, the line is ________ and the slope is ________.

Accepted Answer

A)  downward-sloping; large 
B)  downward-sloping; small 
C)  upward-sloping; small 
D)  either downward or upward-sloping; small 
A)  downward-sloping; large 
B)  downward-sloping; small 
C)  upward-sloping; small 
D)  either downward or upward-sloping; small

Question 5

You have the choice of going on vacation to Florida for one week, staying at work for the week, or spending the week doing fix-up projects around your house. If you decide to go to Florida, the opportunity cost of the trip is

Accepted Answer

A)  working and doing fix-up projects. 
B)  working or doing fix-up projects, depending on which you would have done otherwise. 
C)  working because you would be giving up dollars. 
D)  nothing because you will enjoy the trip to Florida. 
A)  working and doing fix-up projects. 
B)  working or doing fix-up projects, depending on which you would have done otherwise. 
C)  working because you would be giving up dollars. 
D)  nothing because you will enjoy the trip to Florida.

Question 6

What is a tradeoff? Give an example.

Accepted Answer

A tradeoff occurs when one thing must be

Question 7

-The table above shows how the number of books Katie buys each year depends on her income.
a) What kind of relationship exists between Katie's income and the number of books she purchases?
b) Plot the relationship between Katie's income and the number of books she purchases in the above figure. Measure income along the vertical axis and the number of books along the horizontal axis. Be sure to label the axes.
c) What is the slope of the relationship between $50,000 and $70,000 of income?
d) What is the slope of the relationship between $90,000 and $110,000 of income?
e) Comment on the similarity or dissimilarity of your answers to parts (c) and (d).

Accepted Answer

a) There is a positive relationship. Whe

Question 8

-A graph shows the price of a pound of cucumbers on the vertical axis and the quantity of new cars sold by GM on the horizontal axis. The price of a pound of cucumbers remains constant as the quantity of new cars sold increases. The graph of these data is

Accepted Answer

A)  a horizontal line. 
B)  a vertical line. 
C)  a curve with a maximum. 
D)  a positively-sloped line. 
A)  a horizontal line. 
B)  a vertical line. 
C)  a curve with a maximum. 
D)  a positively-sloped line.

Question 9

When graphed, variables that are unrelated are shown by either a horizontal or a vertical line.

Accepted Answer

A) True 
 B)False

Question 10

The vertical axis of a graph shows only positive values.

Accepted Answer

A) True 
 B)False

Question 11

Studying the effects choices have on the individual markets within the economy is part of

Accepted Answer

A)  scarcity. 
B)  microeconomics. 
C)  macroeconomics. 
D)  incentives. 
A)  scarcity. 
B)  microeconomics. 
C)  macroeconomics. 
D)  incentives.

Question 12

-In the table above, Y is measured along the y-axis and X along the x-axis. The slope between points e and f is

Accepted Answer

A)  -25. 
B)  4. 
C)  0.25. 
D)  -0.25. 
A)  -25. 
B)  4. 
C)  0.25. 
D)  -0.25.

Question 13

Statements about what ought to be are called

Accepted Answer

A)  positive statements. 
B)  normative statements. 
C)  assumptions. 
D)  implications. 
A)  positive statements. 
B)  normative statements. 
C)  assumptions. 
D)  implications.

Question 14

Which of the following is a positive statement?

Accepted Answer

A)  State lotteries are good methods to use for raising revenues. 
B)  Increased prison sentences are the best way to reduce the crime rate. 
C)  An increase in gas prices leads people to car pool more. 
D)  Inflation is a more serious problem than is deflation. 
A)  State lotteries are good methods to use for raising revenues. 
B)  Increased prison sentences are the best way to reduce the crime rate. 
C)  An increase in gas prices leads people to car pool more. 
D)  Inflation is a more serious problem than is deflation.

Question 15

-A scatter diagram with the price of vacations to Mexico on the vertical axis and the price of vacations to California on the horizontal axis shows a positive relationship. If the price of vacations to Mexico were placed on the horizontal axis, and the price of vacations to California on the vertical axis, the relationship would be

Accepted Answer

A)  negative relationship, also called a direct relationship. 
B)  negative relationship, also called an inverse relationship. 
C)  positive relationship, also called a direct relationship. 
D)  positive relationship, also called an inverse relationship. 
A)  negative relationship, also called a direct relationship. 
B)  negative relationship, also called an inverse relationship. 
C)  positive relationship, also called a direct relationship. 
D)  positive relationship, also called an inverse relationship.

Question 16

-In the above figure, the relationship between x and y is

Accepted Answer

A)  positive, and the curve becomes flatter as x increases. 
B)  positive, and the curve becomes steeper as x increases. 
C)  positive and linear. 
D)  negative and linear. 
A)  positive, and the curve becomes flatter as x increases. 
B)  positive, and the curve becomes steeper as x increases. 
C)  positive and linear. 
D)  negative and linear.

Question 17

Economics is best defined as the study of how people, businesses, governments, and societies

Accepted Answer

A)  choose abundance over scarcity. 
B)  make choices to cope with scarcity. 
C)  use their infinite resources. 
D)  attain wealth. 
A)  choose abundance over scarcity. 
B)  make choices to cope with scarcity. 
C)  use their infinite resources. 
D)  attain wealth.

Question 18

U.S. producers decide to produce more compact cars and fewer SUVs as the price of gasoline rises. Producers are answering the ________ part of one of the two big economic questions.

Accepted Answer

A)  "what" 
B)  "how" 
C)  "when" 
D)  "how many" 
A)  "what" 
B)  "how" 
C)  "when" 
D)  "how many"

Question 19

Which of the following questions is a topic that would be studied by microeconomics?

Accepted Answer

A)  Why did production and the number of jobs shrink in 2009? 
B)  Will the current budget deficit affect the well-being of the next generation? 
C)  How will a lower price of digital cameras affect the quantity of cameras sold? 
D)  What is the current unemployment rate in the United States? 
A)  Why did production and the number of jobs shrink in 2009? 
B)  Will the current budget deficit affect the well-being of the next generation? 
C)  How will a lower price of digital cameras affect the quantity of cameras sold? 
D)  What is the current unemployment rate in the United States?

Question 20

-As a firm expands its output, cost per unit of output (average cost) decreases and then increases. Average cost and output have

Accepted Answer

A)  a relationship with a minimum. 
B)  a relationship with a maximum. 
C)  no relationship. 
D)  a linear positive relationship. 
A)  a relationship with a minimum. 
B)  a relationship with a maximum. 
C)  no relationship. 
D)  a linear positive relationship.

Exam 1: What Is Economics

Normative statements are statements about

-In the above figure, using the slope across an arc, the slope of the curve between points a and c is

A graph shows that as fees to use ATM machines increase, people use them less frequently. The graph of this relationship would show

If a large change in the variable measured on the x-axis is associated with a small change of the variable measured on the y-axis, the line is ________ and the slope is ________.

You have the choice of going on vacation to Florida for one week, staying at work for the week, or spending the week doing fix-up projects around your house. If you decide to go to Florida, the opportunity cost of the trip is

What is a tradeoff? Give an example.

-A graph shows the price of a pound of cucumbers on the vertical axis and the quantity of new cars sold by GM on the horizontal axis. The price of a pound of cucumbers remains constant as the quantity of new cars sold increases. The graph of these data is

When graphed, variables that are unrelated are shown by either a horizontal or a vertical line.

The vertical axis of a graph shows only positive values.

Studying the effects choices have on the individual markets within the economy is part of

-In the table above, Y is measured along the y-axis and X along the x-axis. The slope between points e and f is

Statements about what ought to be are called

Which of the following is a positive statement?

-In the above figure, the relationship between x and y is

Economics is best defined as the study of how people, businesses, governments, and societies

U.S. producers decide to produce more compact cars and fewer SUVs as the price of gasoline rises. Producers are answering the ________ part of one of the two big economic questions.

Which of the following questions is a topic that would be studied by microeconomics?

-As a firm expands its output, cost per unit of output (average cost) decreases and then increases. Average cost and output have

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

If a large change in the variable measured on the x-axis is associated with a small change of the variable measured on the y-axis, the line is and the slope is .