Question 1

Over the last 60 years, as a proportion of total production, the U.S. economy has produced more

Accepted Answer

A)  agricultural products. 
B)  goods. 
C)  services. 
D)  goods and services. 
A)  agricultural products. 
B)  goods. 
C)  services. 
D)  goods and services.

Question 2

Which of the following best defines capital as a factor of production?

Accepted Answer

A)  Financial assets used by businesses. 
B)  The gifts of nature that businesses use to produce goods and services. 
C)  Instruments, machines, and buildings used in production. 
D)  The knowledge and skills that people obtain from education and use in production of goods and services. 
A)  Financial assets used by businesses. 
B)  The gifts of nature that businesses use to produce goods and services. 
C)  Instruments, machines, and buildings used in production. 
D)  The knowledge and skills that people obtain from education and use in production of goods and services.

Question 3

Which factor of production earns profit?

Accepted Answer

A)  human capital 
B)  money 
C)  entrepreneurship 
D)  land 
A)  human capital 
B)  money 
C)  entrepreneurship 
D)  land

Question 4

What is an opportunity cost? Give an example of an opportunity cost that is paid in money and an opportunity cost that is not explicitly paid. For each example, explain why you think this is an opportunity cost.

Accepted Answer

The opportunity cost of something is the

Question 5

You have the choice of going to Hawaii for a week, staying at work for the week, or spending the week skiing. If you decide to go to Hawaii, the opportunity cost is

Accepted Answer

A)  working, because you would be giving up a week's pay. 
B)  the value of working or skiing, depending on which you would have done rather than go to Hawaii. 
C)  the value of working and skiing. 
D)  None of the above if you enjoy the time spent in Hawaii. 
A)  working, because you would be giving up a week's pay. 
B)  the value of working or skiing, depending on which you would have done rather than go to Hawaii. 
C)  the value of working and skiing. 
D)  None of the above if you enjoy the time spent in Hawaii.

Question 6

Consider the following events:
i. Samsung hires associates to market their HDTV sets to BestBuy.
ii. The Dallas Cowboys build a new football stadium.
iii. Ebay fires 10 percent of its workforce.
iv. Ten million stocks were traded on the New York Stock Exchange in one day.
v. Pennsylvania builds a new state park.
Which of the events describe use of factors of production.?

Accepted Answer

A)  ii, iv, and v. 
B)  i and iii only. 
C)  iv only. 
D)  i, ii, iii, and v. 
A)  ii, iv, and v. 
B)  i and iii only. 
C)  iv only. 
D)  i, ii, iii, and v.

Question 7

When a farmer decides to increase the amount of acreage devoted to wheat and grow fewer acres of soybeans, the farmer is facing the

Accepted Answer

A)  "for whom" tradeoff. 
B)  microeconomic question. 
C)  "how" tradeoff. 
D)  "what" tradeoff. 
A)  "for whom" tradeoff. 
B)  microeconomic question. 
C)  "how" tradeoff. 
D)  "what" tradeoff.

Question 8

Which type of graph is most useful in determining if two variables are correlated?

Accepted Answer

A)  cross- section 
B)  scatter 
C)  time- series 
D)  None of the above answers is correct. 
A)  cross- section 
B)  scatter 
C)  time- series 
D)  None of the above answers is correct.

Question 9

A benefit from an increase in activity is called

Accepted Answer

A)  a total benefit. 
B)  an opportunity gain. 
C)  an economic benefit. 
D)  a marginal benefit. 
A)  a total benefit. 
B)  an opportunity gain. 
C)  an economic benefit. 
D)  a marginal benefit.

Question 10

A positive statement is a statement about

Accepted Answer

A)  what should be but is not. 
B)  what is and what should be. 
C)  what is. 
D)  what is desirable. 
A)  what should be but is not. 
B)  what is and what should be. 
C)  what is. 
D)  what is desirable.

Question 11

Suppose that for the past two months, you have studied economics one hour a day. You now decide to study economics two hours a day. For the past two months, _.

Accepted Answer

A)  the opportunity cost of studying economics must have risen. 
B)  your marginal benefit from studying economics an hour must have been greater than its marginal cost 
C)  your marginal cost of studying economics for an hour must have exceeded its marginal benefit 
D)  the marginal cost of studying economics must have fallen 
A)  the opportunity cost of studying economics must have risen. 
B)  your marginal benefit from studying economics an hour must have been greater than its marginal cost 
C)  your marginal cost of studying economics for an hour must have exceeded its marginal benefit 
D)  the marginal cost of studying economics must have fallen

Question 12

The opportunity cost of attending college includes the cost of

Accepted Answer

A)  tuition, books, and the lost wages for the hours spent studying. 
B)  the tuition but not the job at which you would otherwise have worked. 
C)  the highest valued alternative to attending college plus the cost of tuition. 
D)  the highest valued alternative to attending college. 
A)  tuition, books, and the lost wages for the hours spent studying. 
B)  the tuition but not the job at which you would otherwise have worked. 
C)  the highest valued alternative to attending college plus the cost of tuition. 
D)  the highest valued alternative to attending college.

Question 13

From 8 P.M. to 10 P.M.., Susan can attend a movie, study, or talk with friends. Suppose that Susan decides to go to the movie but thinks that, if she hadn't, she would otherwise have talked with friends. The opportunity cost of attending the movie is

Accepted Answer

A)  talking with friends and studying. 
B)  two hours of time. 
C)  studying. 
D)  talking with friends. 
A)  talking with friends and studying. 
B)  two hours of time. 
C)  studying. 
D)  talking with friends.

Question 14

The term human capital refers to

Accepted Answer

A)  buildings and machinery. 
B)  entrepreneurship and risk- taking. 
C)  labor resources used to make capital equipment. 
D)  people's knowledge and skill. 
A)  buildings and machinery. 
B)  entrepreneurship and risk- taking. 
C)  labor resources used to make capital equipment. 
D)  people's knowledge and skill.

Question 15

Jill, an economics student, has already spent 5 hours cleaning her room. In deciding whether or not to continue cleaning for another hour, she applies the economic principle(s) of

Accepted Answer

A)  productivity. 
B)  scarcity. 
C)  ceteris paribus. 
D)  choosing at the margin. 
A)  productivity. 
B)  scarcity. 
C)  ceteris paribus. 
D)  choosing at the margin.

Question 16

A student athlete is deciding whether to work out for an extra hour. Her marginal benefit from another hour of exercise

Accepted Answer

A)  is the benefit she receives from exercising the additional hour. 
B)  is less than the marginal cost of the additional hour. 
C)  is the benefit she gets from all the hours she's worked out all week. 
D)  depends on the cost of the workout. 
A)  is the benefit she receives from exercising the additional hour. 
B)  is less than the marginal cost of the additional hour. 
C)  is the benefit she gets from all the hours she's worked out all week. 
D)  depends on the cost of the workout.

Question 17

A time- series graph showing the unemployment rate between 1980 and 2002 shows a negative trend. It is likely that the unemployment rate

Accepted Answer

A)  fell every year between 1980 and 2002. 
B)  was lower in 2002 than in 1980. 
C)  rose every year between 1980 and 2002. 
D)  was higher in 2002 than in 1980. 
A)  fell every year between 1980 and 2002. 
B)  was lower in 2002 than in 1980. 
C)  rose every year between 1980 and 2002. 
D)  was higher in 2002 than in 1980.

Question 18

Along a curved line, the slope at the maximum

Accepted Answer

A)  is zero. 
B)  is less than zero. 
C)  is greater than zero. 
D)  may be greater than, less than, or equal to zero. 
A)  is zero. 
B)  is less than zero. 
C)  is greater than zero. 
D)  may be greater than, less than, or equal to zero.

Question 19

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

Accepted Answer

A)  1. 
B)  1/2. 
C)  2. 
D)  2/3. 
A)  1. 
B)  1/2. 
C)  2. 
D)  2/3.

Question 20

Statements about what ought to be are called

Accepted Answer

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

Over the last 60 years, as a proportion of total production, the U.S. economy has produced more

Which of the following best defines capital as a factor of production?

Which factor of production earns profit?

What is an opportunity cost? Give an example of an opportunity cost that is paid in money and an opportunity cost that is not explicitly paid. For each example, explain why you think this is an opportunity cost.

You have the choice of going to Hawaii for a week, staying at work for the week, or spending the week skiing. If you decide to go to Hawaii, the opportunity cost is

When a farmer decides to increase the amount of acreage devoted to wheat and grow fewer acres of soybeans, the farmer is facing the

Which type of graph is most useful in determining if two variables are correlated?

A benefit from an increase in activity is called

A positive statement is a statement about

Suppose that for the past two months, you have studied economics one hour a day. You now decide to study economics two hours a day. For the past two months, _.

The opportunity cost of attending college includes the cost of

From 8 P^.M^.to 10 P^.M^.., Susan can attend a movie, study, or talk with friends. Suppose that Susan decides to go to the movie but thinks that, if she hadn't, she would otherwise have talked with friends. The opportunity cost of attending the movie is

The term human capital refers to

Jill, an economics student, has already spent 5 hours cleaning her room. In deciding whether or not to continue cleaning for another hour, she applies the economic principle(s) of

A student athlete is deciding whether to work out for an extra hour. Her marginal benefit from another hour of exercise

A time- series graph showing the unemployment rate between 1980 and 2002 shows a negative trend. It is likely that the unemployment rate

Along a curved line, the slope at the maximum

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

Statements about what ought to be are called

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Exam 1: What Is Economics

Over the last 60 years, as a proportion of total production, the U.S. economy has produced more

Which of the following best defines capital as a factor of production?

Which factor of production earns profit?

What is an opportunity cost? Give an example of an opportunity cost that is paid in money and an opportunity cost that is not explicitly paid. For each example, explain why you think this is an opportunity cost.

You have the choice of going to Hawaii for a week, staying at work for the week, or spending the week skiing. If you decide to go to Hawaii, the opportunity cost is

When a farmer decides to increase the amount of acreage devoted to wheat and grow fewer acres of soybeans, the farmer is facing the

Which type of graph is most useful in determining if two variables are correlated?

A benefit from an increase in activity is called

A positive statement is a statement about

Suppose that for the past two months, you have studied economics one hour a day. You now decide to study economics two hours a day. For the past two months, _.

The opportunity cost of attending college includes the cost of

From 8 P.M. to 10 P.M.., Susan can attend a movie, study, or talk with friends. Suppose that Susan decides to go to the movie but thinks that, if she hadn't, she would otherwise have talked with friends. The opportunity cost of attending the movie is

The term human capital refers to

Jill, an economics student, has already spent 5 hours cleaning her room. In deciding whether or not to continue cleaning for another hour, she applies the economic principle(s) of

A student athlete is deciding whether to work out for an extra hour. Her marginal benefit from another hour of exercise

A time- series graph showing the unemployment rate between 1980 and 2002 shows a negative trend. It is likely that the unemployment rate

Along a curved line, the slope at the maximum

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

Statements about what ought to be are called

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

From 8 P^.M^.to 10 P^.M^.., Susan can attend a movie, study, or talk with friends. Suppose that Susan decides to go to the movie but thinks that, if she hadn't, she would otherwise have talked with friends. The opportunity cost of attending the movie is