Question 1

An economic model is tested by

Accepted Answer

A) examining the realism of its assumptions. 
B) comparing its predictions with the facts. 
C) comparing its complexity to other models that deal with similar issues. 
D) the Testing Committee of the Canadian Economic Association. 
E) comparing its descriptions and examining the realism of its assumptions. 
A) examining the realism of its assumptions. 
B) comparing its predictions with the facts. 
C) comparing its complexity to other models that deal with similar issues. 
D) the Testing Committee of the Canadian Economic Association. 
E) comparing its descriptions and examining the realism of its assumptions. B

Question 2

Use the table below to answer the following questions.
Table 1A.4.2
  
-Given the data in Table 1A.4.2,holding income constant,the graph relating the price of strawberries,measured on the y-axis and the purchases of strawberries,measured on the x-axis

Accepted Answer

A) is a vertical line. 
B) is a horizontal line. 
C) is a positively sloped line. 
D) is a negatively sloped line. 
E) reaches a minimum. 
A) is a vertical line. 
B) is a horizontal line. 
C) is a positively sloped line. 
D) is a negatively sloped line. 
E) reaches a minimum. D

Question 3

Use the table below to answer the following questions.
Table 1A.3.3
  
-Refer to Table 1A.3.3.When x equals 5,

Accepted Answer

A) y is at a maximum. 
B) y is at a minimum. 
C) the slope is positive. 
D) the slope is negative. 
E) the slope is first positive and then becomes negative. 
A) y is at a maximum. 
B) y is at a minimum. 
C) the slope is positive. 
D) the slope is negative. 
E) the slope is first positive and then becomes negative. B

Question 4

Use the table below to answer the following questions.
Table 1A.4.2
  
-Given the data in Table 1A.4.2,holding price constant,the graph of the purchases of strawberries,measured on the x-axis and family income,measured on the y-axis is a

Accepted Answer

A) vertical line. 
B) horizontal line. 
C) positively sloped line. 
D) negatively sloped line. 
E) positively or negatively sloped line, depending on the price that is held constant. 
A) vertical line. 
B) horizontal line. 
C) positively sloped line. 
D) negatively sloped line. 
E) positively or negatively sloped line, depending on the price that is held constant.

Question 5

Use the figure below to answer the following questions.
   
Figure 1A.4.5
-Consider the following information on cola sales by number of cases for a typical university residence floor:
 
Refer to Figure 1A.4.5.Which one of the following represents what happens when the temperature rises from 20°C to 25°C?

Accepted Answer

A) The curve shifts from A to B. 
B) The curve shifts from C to B. 
C) The curve shifts from B to C. 
D) The curve shifts along line B. 
E) The curve shifts along line C. 
A) The curve shifts from A to B. 
B) The curve shifts from C to B. 
C) The curve shifts from B to C. 
D) The curve shifts along line B. 
E) The curve shifts along line C.

Question 6

Each of the following would be considered a macroeconomic topic except

Accepted Answer

A) the reasons for a decrease in the unemployment rate. 
B) the cause of recessions. 
C) the effect of the government budget deficit on inflation. 
D) the determination of aggregate income. 
E) the selection of production techniques. 
A) the reasons for a decrease in the unemployment rate. 
B) the cause of recessions. 
C) the effect of the government budget deficit on inflation. 
D) the determination of aggregate income. 
E) the selection of production techniques.

Question 7

In choosing among alternative models,economists generally have the strongest preference for models that

Accepted Answer

A) have assumptions that are close to exact replicas of reality. 
B) are detailed and complex, with every available fact and figure included. 
C) have few assumptions and are as simple as possible, even if they cannot predict very well. 
D) predict better than any other that is available. 
E) have assumptions that are complicated. 
A) have assumptions that are close to exact replicas of reality. 
B) are detailed and complex, with every available fact and figure included. 
C) have few assumptions and are as simple as possible, even if they cannot predict very well. 
D) predict better than any other that is available. 
E) have assumptions that are complicated.

Question 8

Which one of the following is an example of land?

Accepted Answer

A) Bono's singing voice 
B) a computer program 
C) Lake Erie 
D) a road 
E) a dam 
A) Bono's singing voice 
B) a computer program 
C) Lake Erie 
D) a road 
E) a dam

Question 9

A normative statement is a statement regarding

Accepted Answer

A) what is usually the case. 
B) the assumptions of an economic model. 
C) what ought to be. 
D) the predictions of an economic model. 
E) what is. 
A) what is usually the case. 
B) the assumptions of an economic model. 
C) what ought to be. 
D) the predictions of an economic model. 
E) what is.

Question 10

In a world characterized by scarcity

Accepted Answer

A) all goods are free. 
B) opportunity cost is zero. 
C) we are not limited by time. 
D) individuals need not work to obtain goods. 
E) people must make choices among alternatives. 
A) all goods are free. 
B) opportunity cost is zero. 
C) we are not limited by time. 
D) individuals need not work to obtain goods. 
E) people must make choices among alternatives.

Question 11

Which one of the following topics does microeconomics study?

Accepted Answer

A) reasons for a fall in the price of orange juice 
B) the effect of a rise in the Canadian dollar on Canada's exports 
C) effect of interest rates on national economic growth 
D) effect of the government budget deficit on employment 
E) determination of total production in a country 
A) reasons for a fall in the price of orange juice 
B) the effect of a rise in the Canadian dollar on Canada's exports 
C) effect of interest rates on national economic growth 
D) effect of the government budget deficit on employment 
E) determination of total production in a country

Question 12

Use the figure below to answer the following questions.
   
Figure 1A.3.10
-Refer to Figure 1A.3.10.The figure shows a relationship between two variables,x and y.The slope at point B is

Accepted Answer

A) 2 
B) -2 
C) 0.25 
D) -0.25 
E) 0.5 
A) 2 
B) -2 
C) 0.25 
D) -0.25 
E) 0.5

Question 13

Which one of the following is an example of capital?

Accepted Answer

A) money 
B) a carpenter 
C) pasture 
D) a bread-slicing machine 
E) a university professor 
A) money 
B) a carpenter 
C) pasture 
D) a bread-slicing machine 
E) a university professor

Question 14

Use the figure below to answer the following question.
   
Figure 1A.2.1
-In Figure 1A.2.1,the value of y is 5 when x is

Accepted Answer

A) 4. 
B) 5. 
C) 6. 
D) 7. 
E) 8. 
A) 4. 
B) 5. 
C) 6. 
D) 7. 
E) 8.

Question 15

Marginal benefit is the

Accepted Answer

A) total benefit from an activity. 
B) additional benefit from a decrease in an activity. 
C) additional benefit from an increase in an activity. 
D) opportunity cost of a decrease in an activity. 
E) opportunity cost of an increase in an activity. 
A) total benefit from an activity. 
B) additional benefit from a decrease in an activity. 
C) additional benefit from an increase in an activity. 
D) opportunity cost of a decrease in an activity. 
E) opportunity cost of an increase in an activity.

Question 16

Use the figure below to answer the following questions.
   
Figure 1A.3.1
-The slope of the line in Figure 1A.3.1 is

Accepted Answer

A) 0.50. 
B) 0.75. 
C) 1.00 
D) 1.25. 
E) 1.50. 
A) 0.50. 
B) 0.75. 
C) 1.00 
D) 1.25. 
E) 1.50.

Question 17

The night before a history test,you decide to go to the movies instead of reviewing your notes.You get 60 percent on your test compared with the 75 percent that you normally score.You ________ a tradeoff ________,and the opportunity cost of your evening at the movies was ________.

Accepted Answer

A) faced;between a higher test score and an evening at the movies;the 15 percent fall in your grade 
B) did not face;because your roommates agreed you should go to the movies and not study;zero 
C) did not face;because you made the best choice;zero 
D) faced;between a higher test score and an evening at the movies;the mark of 60 percent on your test 
E) did not face;most students get 60 percent on history tests;the mark of 60 percent on your test 
A) faced;between a higher test score and an evening at the movies;the 15 percent fall in your grade 
B) did not face;because your roommates agreed you should go to the movies and not study;zero 
C) did not face;because you made the best choice;zero 
D) faced;between a higher test score and an evening at the movies;the mark of 60 percent on your test 
E) did not face;most students get 60 percent on history tests;the mark of 60 percent on your test

Question 18

The relationship between two variables that move in opposite directions is shown graphically by a line that is

Accepted Answer

A) positively sloped. 
B) relatively steep. 
C) relatively flat. 
D) negatively sloped. 
E) curved. 
A) positively sloped. 
B) relatively steep. 
C) relatively flat. 
D) negatively sloped. 
E) curved.

Question 19

When the government of Alberta chooses to build more roads,the required resources are no longer available to provide better health care facilities.This situation illustrates the concept of

Accepted Answer

A) marginal benefit. 
B) monetary cost. 
C) opportunity cost. 
D) human capital. 
E) entrepreneurship. 
A) marginal benefit. 
B) monetary cost. 
C) opportunity cost. 
D) human capital. 
E) entrepreneurship.

Question 20

"The rich face higher income tax rates than the poor" is an example of a

Accepted Answer

A) a normative statement. 
B) a positive statement. 
C) a predictive statement. 
D) a theoretical statement. 
E) an analytical statement. 
A) a normative statement. 
B) a positive statement. 
C) a predictive statement. 
D) a theoretical statement. 
E) an analytical statement.

Exam 1: What Is Economics?

An economic model is tested by

Use the table below to answer the following questions. Table 1A.4.2 -Given the data in Table 1A.4.2,holding income constant,the graph relating the price of strawberries,measured on the y-axis and the purchases of strawberries,measured on the x-axis

Use the table below to answer the following questions. Table 1A.3.3 -Refer to Table 1A.3.3.When x equals 5,

Use the table below to answer the following questions. Table 1A.4.2 -Given the data in Table 1A.4.2,holding price constant,the graph of the purchases of strawberries,measured on the x-axis and family income,measured on the y-axis is a

Each of the following would be considered a macroeconomic topic except

In choosing among alternative models,economists generally have the strongest preference for models that

Which one of the following is an example of land?

A normative statement is a statement regarding

In a world characterized by scarcity

Which one of the following topics does microeconomics study?

Use the figure below to answer the following questions. Figure 1A.3.10 -Refer to Figure 1A.3.10.The figure shows a relationship between two variables,x and y.The slope at point B is

Which one of the following is an example of capital?

Use the figure below to answer the following question. Figure 1A.2.1 -In Figure 1A.2.1,the value of y is 5 when x is

Marginal benefit is the

Use the figure below to answer the following questions. Figure 1A.3.1 -The slope of the line in Figure 1A.3.1 is

The night before a history test,you decide to go to the movies instead of reviewing your notes.You get 60 percent on your test compared with the 75 percent that you normally score.You ________ a tradeoff ________,and the opportunity cost of your evening at the movies was ________.

The relationship between two variables that move in opposite directions is shown graphically by a line that is

When the government of Alberta chooses to build more roads,the required resources are no longer available to provide better health care facilities.This situation illustrates the concept of

"The rich face higher income tax rates than the poor" is an example of a

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

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

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: The Keynesian Model

Canadian Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

The night before a history test,you decide to go to the movies instead of reviewing your notes.You get 60 percent on your test compared with the 75 percent that you normally score.You a tradeoff ,and the opportunity cost of your evening at the movies was .