Question 1

Which statement uses the term ceteris paribus correctly?

Accepted Answer

A)  If you exercise regularly, you will be healthier, ceteris paribus. 
B)  Blue is to green, ceteris paribus, as red is to purple. 
C)  Most people consider Sunday to be the first day of the week, ceteris paribus. 
D)  Interest rates usually rise in October, ceteris paribus. 
E)  a and d 
A)  If you exercise regularly, you will be healthier, ceteris paribus. 
B)  Blue is to green, ceteris paribus, as red is to purple. 
C)  Most people consider Sunday to be the first day of the week, ceteris paribus. 
D)  Interest rates usually rise in October, ceteris paribus. 
E)  a and d A

Question 2

The concept that relates how much one variable changes as another variable changes is

Accepted Answer

A)  slope. 
B)  line. 
C)  curve. 
D)  graph. 
A)  slope. 
B)  line. 
C)  curve. 
D)  graph. A

Question 3

Exhibit 1-2
  
-Refer to Exhibit 1-2. According to the data provided in this table,what is the slope of the line between points C and D,if these data were graphed with X on the horizontal axis and Y on the vertical axis?

Accepted Answer

A)  -3.00 
B)  -0.33 
C)  3.00 
D)  0.33 
E)  none of the above 
A)  -3.00 
B)  -0.33 
C)  3.00 
D)  0.33 
E)  none of the above C

Question 4

According to the text,British soldiers were required to wear bright red coats during the Revolutionary War in order to make it easier to find deserters.

Accepted Answer

A) True 
 B)False

Question 5

Minerals,animals,water and forests are all considered to be the resource known as

Accepted Answer

A)  capital 
B)  entrepreneurship 
C)  labor 
D)  land 
E)  none of the above 
A)  capital 
B)  entrepreneurship 
C)  labor 
D)  land 
E)  none of the above

Question 6

The __________ the opportunity cost of doing something,the __________ likely a person will do that something.

Accepted Answer

A)  lower; less 
B)  lower; more 
C)  higher; more 
D)  higher; less 
E)  b and d 
A)  lower; less 
B)  lower; more 
C)  higher; more 
D)  higher; less 
E)  b and d

Question 7

List and describe the four broad categories of resources.Cite an example of each to help support your answer.

Accepted Answer

Economists divide resources into four ca

Question 8

Price is the only rationing device that can be used in a modern economy.

Accepted Answer

A) True 
 B)False

Question 9

Macroeconomics deals with issues involving large corporations,while microeconomics exclusively deals with issues involving small businesses.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following is a positive economic statement?

Accepted Answer

A)  We should raise the minimum wage in order to provide a decent wage for more people. 
B)  Consumers bought fewer cars when the relative price of cars increased. 
C)  The budget deficit has been rising in recent years. 
D)  Federal government spending ought to be curtailed. 
E)  b and c 
A)  We should raise the minimum wage in order to provide a decent wage for more people. 
B)  Consumers bought fewer cars when the relative price of cars increased. 
C)  The budget deficit has been rising in recent years. 
D)  Federal government spending ought to be curtailed. 
E)  b and c

Question 11

Let X be the number of hours you spend studying for an exam on Wednesday afternoon and Y be your chances of winning the Wednesday night state lottery.What kind of a relationship do you most likely expect between X and Y?

Accepted Answer

A)  direct 
B)  inverse 
C)  linear 
D)  45-degree line 
E)  independent 
A)  direct 
B)  inverse 
C)  linear 
D)  45-degree line 
E)  independent

Question 12

Variables A and B are directly related.If we plot A on the horizontal axis and B on the vertical axis,the line that connects combinations of A and B in a two-variable diagram is

Accepted Answer

A)  parallel to the horizontal axis. 
B)  downward-sloping (left to right). 
C)  parallel to the vertical axis. 
D)  upward-sloping (left to right). 
E)  a or c 
A)  parallel to the horizontal axis. 
B)  downward-sloping (left to right). 
C)  parallel to the vertical axis. 
D)  upward-sloping (left to right). 
E)  a or c

Question 13

Here are three things you could do if you do not attend your neighbor's barbecue: watch television with some friends (you value this at $17),read a good novel (you value this at $14),or go in to work (you could earn $16 during the barbecue).The opportunity cost of going to your neighbor's barbecue is

Accepted Answer

A)  $16, because this is the only alternative of the three where you actually receive a monetary payment. 
B)  $14, because this is the lowest valued alternative forfeited. 
C)  $17, because this is the highest valued alternative forfeited. 
D)  $47, because this is the total dollar sum of the alternatives forfeited. 
A)  $16, because this is the only alternative of the three where you actually receive a monetary payment. 
B)  $14, because this is the lowest valued alternative forfeited. 
C)  $17, because this is the highest valued alternative forfeited. 
D)  $47, because this is the total dollar sum of the alternatives forfeited.

Question 14

A mandatory seatbelt law ends up raising the number of traffic fatalities if it lowers fatalities per accident from 0.10 to 0.07 while raising the number of accidents per period from 35,000 to any more than

Accepted Answer

A)  35,000. 
B)  38,500. 
C)  37,450. 
D)  50,000. 
A)  35,000. 
B)  38,500. 
C)  37,450. 
D)  50,000.

Question 15

Scarcity is defined as the condition in which

Accepted Answer

A)  both wants and resources are limited. 
B)  wants are finite and resources infinite. 
C)  both wants and resources are infinite. 
D)  wants are infinite and resources finite. 
A)  both wants and resources are limited. 
B)  wants are finite and resources infinite. 
C)  both wants and resources are infinite. 
D)  wants are infinite and resources finite.

Question 16

The author of the text defines economics as the

Accepted Answer

A)  science of efficiency. 
B)  science of scarcity. 
C)  study of markets. 
D)  study of human activity. 
A)  science of efficiency. 
B)  science of scarcity. 
C)  study of markets. 
D)  study of human activity.

Question 17

In most societies,dollar price acts as the main rationing device.If dollar price weren't the main rationing device,would there still be a need for some rationing device to take its place?

Accepted Answer

A)  No, because with dollar price there would be no scarcity, although shortages would still exist. 
B)  Yes, because there is a need for a rationing device as long as scarcity exists. 
C)  Yes, because there is a need for a rationing device as long as the world's population is so large. 
D)  No, because dollar price creates scarcity and without money price scarcity wouldn't exist. 
E)  none of the above 
A)  No, because with dollar price there would be no scarcity, although shortages would still exist. 
B)  Yes, because there is a need for a rationing device as long as scarcity exists. 
C)  Yes, because there is a need for a rationing device as long as the world's population is so large. 
D)  No, because dollar price creates scarcity and without money price scarcity wouldn't exist. 
E)  none of the above

Question 18

To an economist,the terms factor and resource are synonyms.

Accepted Answer

A) True 
 B)False

Question 19

Is it possible for mandatory seatbelt laws to increase vehicle fatalities?

Accepted Answer

A)  Yes, if the number of accidents increases by a greater percentage than the number of deaths per accident decreases. 
B)  No, because wearing seatbelts decreases the number of deaths per accident. 
C)  No, because wearing seatbelts decreases the number of accidents. 
D)  There is not enough information to answer the question. 
A)  Yes, if the number of accidents increases by a greater percentage than the number of deaths per accident decreases. 
B)  No, because wearing seatbelts decreases the number of deaths per accident. 
C)  No, because wearing seatbelts decreases the number of accidents. 
D)  There is not enough information to answer the question.

Question 20

Scarcity affects everyone,even billionaires.

Accepted Answer

A) True 
 B)False

Exam 1: What Economics Is About

Which statement uses the term ceteris paribus correctly?

The concept that relates how much one variable changes as another variable changes is

Exhibit 1-2 -Refer to Exhibit 1-2. According to the data provided in this table,what is the slope of the line between points C and D,if these data were graphed with X on the horizontal axis and Y on the vertical axis?

According to the text,British soldiers were required to wear bright red coats during the Revolutionary War in order to make it easier to find deserters.

Minerals,animals,water and forests are all considered to be the resource known as

The __________ the opportunity cost of doing something,the __________ likely a person will do that something.

List and describe the four broad categories of resources.Cite an example of each to help support your answer.

Price is the only rationing device that can be used in a modern economy.

Macroeconomics deals with issues involving large corporations,while microeconomics exclusively deals with issues involving small businesses.

Which of the following is a positive economic statement?

Let X be the number of hours you spend studying for an exam on Wednesday afternoon and Y be your chances of winning the Wednesday night state lottery.What kind of a relationship do you most likely expect between X and Y?

Variables A and B are directly related.If we plot A on the horizontal axis and B on the vertical axis,the line that connects combinations of A and B in a two-variable diagram is

A mandatory seatbelt law ends up raising the number of traffic fatalities if it lowers fatalities per accident from 0.10 to 0.07 while raising the number of accidents per period from 35,000 to any more than

Scarcity is defined as the condition in which

The author of the text defines economics as the

In most societies,dollar price acts as the main rationing device.If dollar price weren't the main rationing device,would there still be a need for some rationing device to take its place?

To an economist,the terms factor and resource are synonyms.

Is it possible for mandatory seatbelt laws to increase vehicle fatalities?

Scarcity affects everyone,even billionaires.

Production Possibilities Frontier Framework

Supply and Demand: Theory

Prices: Free, Controlled, and Relative

Supply, Demand, and Price: Applications

Macroeconomic Measurements: Prices and Unemployment

Macroeconomic Measurements: GDP and Real GDP

Aggregate Demand and Aggregate Supply

Classical Macroeconomics and the Self Regulating Economy

Keynesian Macroeconomics and Economic Instability: A Critique of the Self-Regulating Economy

Fiscal Policy and the Federal Budget

Money, Banking,and the Financial System

The Federal Reserve System

Money and the Economy

Monetary Policy

Expectations Theory and the Economy

Economic Growth: Resources, Technology, Ideas, and Institutions

The Financial Crisis of 2007-2009

Debates in Macroeconomics Over the Role and Effects of Government

Elasticity

Consumer Choice: Maximizing Utility and Behavioral Economics

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition, Oligopoly, and Game Theory

Government and Product Markets: Antitrust and Regulation

Factor Markets: With Emphasis on the Labor Market

Wages,Unions,and Labor

The Distribution of Income and Poverty

Interest, Rent, and Profit

Market Failure: Externalities, Public Goods, and Asymmetric Information

Public Choice and Special-Interest-Group Politics

Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

International Trade

International Finance

Globalization and International Impacts on the Economy

The Economic Case For and Against Government: Five Topics Considered

Stocks, Bonds, Futures, and Options

Agriculture: Problems, Policies, and Unintended Effects

Filters

The the opportunity cost of doing something,the likely a person will do that something.