Question 1

If variable X rises as variable Y falls,then X and Y have an inverse relationship.

Accepted Answer

A) True 
 B)False

Question 2

In economics,a synonym for utility is

Accepted Answer

A)  usefulness. 
B)  satisfaction. 
C)  sacrifice. 
D)  a service. 
A)  usefulness. 
B)  satisfaction. 
C)  sacrifice. 
D)  a service.

Question 3

Normative economics is concerned with

Accepted Answer

A)  value judgments. 
B)  opinions. 
C)  cause-effect relationships. 
D)  observations that can be proved. 
E)  both a and b 
A)  value judgments. 
B)  opinions. 
C)  cause-effect relationships. 
D)  observations that can be proved. 
E)  both a and b

Question 4

Economists use the terms resource and input as synonyms.

Accepted Answer

A) True 
 B)False

Question 5

Define the term rationing device and give an example of three possible rationing devices. Explain how scarcity implies the need for a rationing device.

Accepted Answer

A rationing device is a mechanism used t

Question 6

In all cases,microeconomics deals with

Accepted Answer

A)  what is. 
B)  what should be. 
C)  relatively small units in the economy. 
D)  the entire economy. 
A)  what is. 
B)  what should be. 
C)  relatively small units in the economy. 
D)  the entire economy.

Question 7

Explain what an economist means by the phrase "decisions made at the margin." Cite an example to support your answer.

Accepted Answer

When making a decision at the margin an

Question 8

Scarcity means

Accepted Answer

A)  wants are greater than the limited resources available to satisfy these wants. 
B)  wants are less than the limited resources available to satisfy these wants. 
C)  resources are infinite. 
D)  wants are limited. 
E)  both c and d 
A)  wants are greater than the limited resources available to satisfy these wants. 
B)  wants are less than the limited resources available to satisfy these wants. 
C)  resources are infinite. 
D)  wants are limited. 
E)  both c and d

Question 9

The headline in the newspaper reads "County Supervisors Debate Building New Schools." The headline relates closest to which economic concept?

Accepted Answer

A)  goods and bads 
B)  utility 
C)  choice 
D)  efficiency 
A)  goods and bads 
B)  utility 
C)  choice 
D)  efficiency

Question 10

The question of how a tax change might impact U.S.economic output is most closely associated with the study of

Accepted Answer

A)  microeconomics. 
B)  managerial economics. 
C)  macroeconomics. 
D)  consumer economics. 
A)  microeconomics. 
B)  managerial economics. 
C)  macroeconomics. 
D)  consumer economics.

Question 11

It usually takes less time to buy a six-pack of 7-Up,a loaf of bread,and a half-gallon of ice cream at a small convenience store (such as a 7-Eleven)than at a large,full-service grocery store.Which of the following persons is most likely to buy these items at a convenience store?

Accepted Answer

A)  a person with high opportunity cost of time 
B)  a person with low opportunity cost of time 
C)  a person who is out of work 
D)  There is not enough information to answer the question. 
A)  a person with high opportunity cost of time 
B)  a person with low opportunity cost of time 
C)  a person who is out of work 
D)  There is not enough information to answer the question.

Question 12

Explain how scarcity can exist in a relatively rich country such as the United States. Give examples to help support your answer.

Accepted Answer

Even in a wealthy country,the people liv

Question 13

Economists use the ceteris paribus assumption primarily in order to

Accepted Answer

A)  make their analyses easier for them to conduct. 
B)  designate what they believe is the correct relationship between two variables. 
C)  explain why people sometimes consume more of a good when its price rises. 
D)  explain why those things that come first do not necessarily cause those things that come later. 
E)  designate the difference between normative and positive economics. 
A)  make their analyses easier for them to conduct. 
B)  designate what they believe is the correct relationship between two variables. 
C)  explain why people sometimes consume more of a good when its price rises. 
D)  explain why those things that come first do not necessarily cause those things that come later. 
E)  designate the difference between normative and positive economics.

Question 14

Some economic studies have shown that mandatory seat belt laws do not lead to a reduction in traffic fatalities.

Accepted Answer

A) True 
 B)False

Question 15

A mandatory seatbelt law ends up raising the number of traffic fatalities if it lowers fatalities per accident from 0.12 to 0.08 while raising the number of accidents per period from 400,000 to any more than

Accepted Answer

A)  480,000. 
B)  600,000. 
C)  660,000. 
D)  770,000. 
A)  480,000. 
B)  600,000. 
C)  660,000. 
D)  770,000.

Question 16

The condition in an economy that makes a "rationing device" a necessity is the fact that

Accepted Answer

A)  the economy is organized around free markets. 
B)  the economy is centrally planned by the government. 
C)  scarcity exists. 
D)  there are fewer types of goods than there are people in the economy. 
A)  the economy is organized around free markets. 
B)  the economy is centrally planned by the government. 
C)  scarcity exists. 
D)  there are fewer types of goods than there are people in the economy.

Question 17

A person goes into a store and buys a computer for $1,210.In this case,price is acting as a

Accepted Answer

A)  resource. 
B)  good. 
C)  rationing device. 
D)  capital instrument. 
E)  factor of production. 
A)  resource. 
B)  good. 
C)  rationing device. 
D)  capital instrument. 
E)  factor of production.

Question 18

What is the difference between macroeconomics and microeconomics? Give an example of a question that a macroeconomist might be interested in answering,then do the same for a microeconomist.

Accepted Answer

Macroeconomics is the branch of economic

Question 19

Which of the following statements is false?

Accepted Answer

A)  Microeconomics is the branch of economics that deals with human behavior and choices as they relate to relatively small units-an individual, a firm, an industry, and a single market. 
B)  Macroeconomics is the branch of economics that deals with human behavior and choices as they relate to highly aggregate markets. 
C)  Positive economics attempts to determine what is. 
D)  Normative economics addresses what should be. 
E)  Positive and normative economics both address what should be. 
A)  Microeconomics is the branch of economics that deals with human behavior and choices as they relate to relatively small units-an individual, a firm, an industry, and a single market. 
B)  Macroeconomics is the branch of economics that deals with human behavior and choices as they relate to highly aggregate markets. 
C)  Positive economics attempts to determine what is. 
D)  Normative economics addresses what should be. 
E)  Positive and normative economics both address what should be.

Question 20

Prior to attending college,Darius is offered a lucrative four-year contract as an actor in a daytime soap opera.Assuming that acting and attending college are Darius' preferred alternatives and that he must choose between the two,his cost of attending college after receiving the offer

Accepted Answer

A)  increases. 
B)  decreases. 
C)  stays the same. 
D)  increases or stays the same depending on whether he accepts the offer. 
A)  increases. 
B)  decreases. 
C)  stays the same. 
D)  increases or stays the same depending on whether he accepts the offer.

Exam 1: What Economics Is About

If variable X rises as variable Y falls,then X and Y have an inverse relationship.

In economics,a synonym for utility is

Normative economics is concerned with

Economists use the terms resource and input as synonyms.

Define the term rationing device and give an example of three possible rationing devices. Explain how scarcity implies the need for a rationing device.

In all cases,microeconomics deals with

Explain what an economist means by the phrase "decisions made at the margin." Cite an example to support your answer.

Scarcity means

The headline in the newspaper reads "County Supervisors Debate Building New Schools." The headline relates closest to which economic concept?

The question of how a tax change might impact U.S.economic output is most closely associated with the study of

It usually takes less time to buy a six-pack of 7-Up,a loaf of bread,and a half-gallon of ice cream at a small convenience store (such as a 7-Eleven)than at a large,full-service grocery store.Which of the following persons is most likely to buy these items at a convenience store?

Explain how scarcity can exist in a relatively rich country such as the United States. Give examples to help support your answer.

Economists use the ceteris paribus assumption primarily in order to

Some economic studies have shown that mandatory seat belt laws do not lead to a reduction in traffic fatalities.

A mandatory seatbelt law ends up raising the number of traffic fatalities if it lowers fatalities per accident from 0.12 to 0.08 while raising the number of accidents per period from 400,000 to any more than

The condition in an economy that makes a "rationing device" a necessity is the fact that

A person goes into a store and buys a computer for $1,210.In this case,price is acting as a

What is the difference between macroeconomics and microeconomics? Give an example of a question that a macroeconomist might be interested in answering,then do the same for a microeconomist.

Which of the following statements is false?

Prior to attending college,Darius is offered a lucrative four-year contract as an actor in a daytime soap opera.Assuming that acting and attending college are Darius' preferred alternatives and that he must choose between the two,his cost of attending college after receiving the offer

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

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