Question 1

In economics, the term "scarcity" refers to the fact that

Accepted Answer

A)  everything really worthwhile costs money. 
B)  even in wealthy countries like the United States, some people are poor. 
C)  no society can produce enough to satisfy fully the desires of people for goods and services. 
D)  sometimes shortages of a good arise when its price is set below the market equilibrium. 
A)  everything really worthwhile costs money. 
B)  even in wealthy countries like the United States, some people are poor. 
C)  no society can produce enough to satisfy fully the desires of people for goods and services. 
D)  sometimes shortages of a good arise when its price is set below the market equilibrium.

Question 2

Which of the following is the best definition of economics?

Accepted Answer

A)  An investigation of the quantities and prices of the various goods produced by the nations of the world. 
B)  A study of why inflation and unemployment periodically plague the U.S. economy. 
C)  An analysis of how individuals and societies deal with the problem of scarcity. 
D)  An examination of the role that money plays in the economy. 
E)  A study of how goods and services are distributed throughout the world. 
A)  An investigation of the quantities and prices of the various goods produced by the nations of the world. 
B)  A study of why inflation and unemployment periodically plague the U.S. economy. 
C)  An analysis of how individuals and societies deal with the problem of scarcity. 
D)  An examination of the role that money plays in the economy. 
E)  A study of how goods and services are distributed throughout the world.

Question 3

The expression "There's no such thing as a free lunch" means

Accepted Answer

A)  if one person gains, someone else must lose. 
B)  each person must pay for exactly what he or she receives. 
C)  the use of resources to produce a good has an opportunity cost because of scarcity. 
D)  you cannot have a free lunch at the expense of someone else. 
A)  if one person gains, someone else must lose. 
B)  each person must pay for exactly what he or she receives. 
C)  the use of resources to produce a good has an opportunity cost because of scarcity. 
D)  you cannot have a free lunch at the expense of someone else.

Question 4

When economists say an individual has made a rational choice, they mean the individual has

Accepted Answer

A)  made the choice by weighing their own subjective costs and benefits. 
B)  made a "good" decision, one that reasonable outside observers would have also made. 
C)  neglected to consider the unintended consequences arising from their decision. 
D)  ignored their own personal interests and made the choice that is best for society. 
A)  made the choice by weighing their own subjective costs and benefits. 
B)  made a "good" decision, one that reasonable outside observers would have also made. 
C)  neglected to consider the unintended consequences arising from their decision. 
D)  ignored their own personal interests and made the choice that is best for society.

Question 5

The Earned Income Tax Credit provides a tax credit or rebate to

Accepted Answer

A)  businesses that undertake investment expenditures. 
B)  taxpayers with incomes greater than $100,000. 
C)  persons with low incomes who are working. 
D)  single parent families when the parent stays home to take care of the children. 
A)  businesses that undertake investment expenditures. 
B)  taxpayers with incomes greater than $100,000. 
C)  persons with low incomes who are working. 
D)  single parent families when the parent stays home to take care of the children.

Question 6

Which of the following most clearly distinguishes government from a private business?

Accepted Answer

A)  Production of goods and services-private businesses produce things; governments do not. 
B)  The power to tax. 
C)  The hiring of law enforcement employees to protect property rights. 
D)  Selfishness-the owners and managers of private businesses are selfish; government officials are not. 
A)  Production of goods and services-private businesses produce things; governments do not. 
B)  The power to tax. 
C)  The hiring of law enforcement employees to protect property rights. 
D)  Selfishness-the owners and managers of private businesses are selfish; government officials are not.

Question 7

"There is no such thing as a free lunch." This statement best reflects the fact that

Accepted Answer

A)  consumers are unwilling to pay for a good unless it provides them with value. 
B)  an opportunity cost is always present when scarce resources are used to produce a good. 
C)  it generally requires enormous effort to search out the best place to eat lunch. 
D)  the value of a good to consumers will decrease as they have more of it. 
A)  consumers are unwilling to pay for a good unless it provides them with value. 
B)  an opportunity cost is always present when scarce resources are used to produce a good. 
C)  it generally requires enormous effort to search out the best place to eat lunch. 
D)  the value of a good to consumers will decrease as they have more of it.

Question 8

The term ceteris paribus means that

Accepted Answer

A)  everything is changing. 
B)  all variables except those specified are constant. 
C)  no one knows which variables will change and which will remain constant. 
D)  the basic postulate of economics does not apply for the case being considered. 
A)  everything is changing. 
B)  all variables except those specified are constant. 
C)  no one knows which variables will change and which will remain constant. 
D)  the basic postulate of economics does not apply for the case being considered.

Question 9

There are no graphics questions for this chapter.​

Accepted Answer

It seems like you are referring to a spe

Question 10

A popular video program, used to teach primary school children about economics, defines scarcity as "when you don't have enough of something." Evaluate this definition based on your understanding of the scarcity concept.

Accepted Answer

This definition is a bit simplistic for

Question 11

While waiting in line to buy two tacos at 75 cents each, and a medium drink for 80 cents, Emma notices that the restaurant has a value meal containing three tacos and a medium drink all for $2.50. For Emma, the marginal cost of purchasing the third taco would be

Accepted Answer

A)  zero. 
B)  20 cents. 
C)  75 cents. 
D)  80 cents. 
A)  zero. 
B)  20 cents. 
C)  75 cents. 
D)  80 cents.

Question 12

The expression, "There's no such thing as a free lunch," implies that

Accepted Answer

A)  everyone has to pay for his own lunch. 
B)  the person consuming a good must always pay for it. 
C)  opportunity costs are incurred when resources are used to produce goods and services. 
D)  no one has time for a good lunch anymore. 
A)  everyone has to pay for his own lunch. 
B)  the person consuming a good must always pay for it. 
C)  opportunity costs are incurred when resources are used to produce goods and services. 
D)  no one has time for a good lunch anymore.

Question 13

Which one of the following is a positive economic statement?

Accepted Answer

A)  An increase in the minimum wage will reduce employment. 
B)  The minimum wage should be increased. 
C)  Social justice will be served by increasing the minimum wage. 
D)  Thoughtful people oppose an increase in the minimum wage. 
A)  An increase in the minimum wage will reduce employment. 
B)  The minimum wage should be increased. 
C)  Social justice will be served by increasing the minimum wage. 
D)  Thoughtful people oppose an increase in the minimum wage.

Question 14

If economics is correct in its assumption that people are rational, why then would anyone choose to smoke cigarettes?

Accepted Answer

Even though the harmful effects of cigar

Question 15

Measured as a share of GDP, the total government expenditures of the United States are

Accepted Answer

A)  larger than any country in the world. 
B)  smaller than any country in the world. 
C)  smaller than the comparable figure for Japan and most Western European countries. 
D)  larger than the comparable figure for Japan and most Western European countries. 
A)  larger than any country in the world. 
B)  smaller than any country in the world. 
C)  smaller than the comparable figure for Japan and most Western European countries. 
D)  larger than the comparable figure for Japan and most Western European countries.

Question 16

The economic way of thinking stresses that

Accepted Answer

A)  greed is the primary motivation for human action. 
B)  as the benefits of an option increase, people will be more likely to choose that option. 
C)  an objective value can be attached to physical goods. 
D)  as the cost of an option decreases, people will be less likely to choose that option. 
A)  greed is the primary motivation for human action. 
B)  as the benefits of an option increase, people will be more likely to choose that option. 
C)  an objective value can be attached to physical goods. 
D)  as the cost of an option decreases, people will be less likely to choose that option.

Question 17

Which of the following groups would most likely benefit from a law that is extremely tough on those who drink and drive?

Accepted Answer

A)  truck drivers 
B)  taxi drivers 
C)  bartenders 
D)  doctors and nurses 
A)  truck drivers 
B)  taxi drivers 
C)  bartenders 
D)  doctors and nurses

Question 18

Which of the following is most consistent with economizing behavior?

Accepted Answer

A)  If you get the same satisfaction from a hamburger and a fish sandwich, you should purchase the one that costs the most. 
B)  Even if you know how to paint, hiring someone to do the job is consistent with economizing behavior, if your opportunity cost is high enough. 
C)  If the government provides a good free to citizens, the opportunity cost of the good is zero. 
D)  If you get the same satisfaction from going to the opera and going to an art museum, it makes no difference which you choose. 
A)  If you get the same satisfaction from a hamburger and a fish sandwich, you should purchase the one that costs the most. 
B)  Even if you know how to paint, hiring someone to do the job is consistent with economizing behavior, if your opportunity cost is high enough. 
C)  If the government provides a good free to citizens, the opportunity cost of the good is zero. 
D)  If you get the same satisfaction from going to the opera and going to an art museum, it makes no difference which you choose.

Question 19

Adam Smith believed that if people were free to pursue their own interests,

Accepted Answer

A)  public interest would be served quite well. 
B)  less would be produced than if altruism were the guiding principle. 
C)  they would generally apply their talents to unproductive activities that would generate little value to society. 
D)  they would have little incentive to undertake productive activities. 
A)  public interest would be served quite well. 
B)  less would be produced than if altruism were the guiding principle. 
C)  they would generally apply their talents to unproductive activities that would generate little value to society. 
D)  they would have little incentive to undertake productive activities.

Question 20

Positive economics

Accepted Answer

A)  postulates a relationship that is potentially refutable and then seeks to determine whether the stated relationship is correct. 
B)  uses value judgments to determine which policy alternatives should be chosen. 
C)  is of no use to policy makers because it reflects the value judgments of the researcher. 
D)  is the scientific study of "what ought to be" among economic relationships. 
A)  postulates a relationship that is potentially refutable and then seeks to determine whether the stated relationship is correct. 
B)  uses value judgments to determine which policy alternatives should be chosen. 
C)  is of no use to policy makers because it reflects the value judgments of the researcher. 
D)  is the scientific study of "what ought to be" among economic relationships.

In economics, the term "scarcity" refers to the fact that

Which of the following is the best definition of economics?

The expression "There's no such thing as a free lunch" means

When economists say an individual has made a rational choice, they mean the individual has

The Earned Income Tax Credit provides a tax credit or rebate to

Which of the following most clearly distinguishes government from a private business?

"There is no such thing as a free lunch." This statement best reflects the fact that

The term ceteris paribus means that

There are no graphics questions for this chapter.

A popular video program, used to teach primary school children about economics, defines scarcity as "when you don't have enough of something." Evaluate this definition based on your understanding of the scarcity concept.

While waiting in line to buy two tacos at 75 cents each, and a medium drink for 80 cents, Emma notices that the restaurant has a value meal containing three tacos and a medium drink all for $2.50. For Emma, the marginal cost of purchasing the third taco would be

The expression, "There's no such thing as a free lunch," implies that

Which one of the following is a positive economic statement?

If economics is correct in its assumption that people are rational, why then would anyone choose to smoke cigarettes?

Measured as a share of GDP, the total government expenditures of the United States are

The economic way of thinking stresses that

Which of the following groups would most likely benefit from a law that is extremely tough on those who drink and drive?

Which of the following is most consistent with economizing behavior?

Adam Smith believed that if people were free to pursue their own interests,

Positive economics

Some Tools of the Economist

Demand, Supply, and the Market Process

Supply and Demand: Applications and Extensions

Difficult Cases for the Market, and the Role of Government

The Economics of Political Action

Consumer Choice and Elasticity

Costs and the Supply of Goods

Price Takers and the Competitive Process

Price-Searcher Markets With Low Entry Barriers

Price-Searcher Markets With High Entry Barriers

The Supply of and Demand for Productive Resources

Earnings, Productivity, and the Job Market

Investment, the Capital Market, and the Wealth of Nations

Income Inequality and Poverty

Gaining From International Trade

Filters

Exam 1: The Economic Approach

In economics, the term "scarcity" refers to the fact that

Which of the following is the best definition of economics?

The expression "There's no such thing as a free lunch" means

When economists say an individual has made a rational choice, they mean the individual has

The Earned Income Tax Credit provides a tax credit or rebate to

Which of the following most clearly distinguishes government from a private business?

"There is no such thing as a free lunch." This statement best reflects the fact that

The term ceteris paribus means that

There are no graphics questions for this chapter.​

A popular video program, used to teach primary school children about economics, defines scarcity as "when you don't have enough of something." Evaluate this definition based on your understanding of the scarcity concept.

While waiting in line to buy two tacos at 75 cents each, and a medium drink for 80 cents, Emma notices that the restaurant has a value meal containing three tacos and a medium drink all for $2.50. For Emma, the marginal cost of purchasing the third taco would be

The expression, "There's no such thing as a free lunch," implies that

Which one of the following is a positive economic statement?

If economics is correct in its assumption that people are rational, why then would anyone choose to smoke cigarettes?

Measured as a share of GDP, the total government expenditures of the United States are

The economic way of thinking stresses that

Which of the following groups would most likely benefit from a law that is extremely tough on those who drink and drive?

Which of the following is most consistent with economizing behavior?

Adam Smith believed that if people were free to pursue their own interests,

Positive economics

Some Tools of the Economist

Demand, Supply, and the Market Process

Supply and Demand: Applications and Extensions

Difficult Cases for the Market, and the Role of Government

The Economics of Political Action

Consumer Choice and Elasticity

Costs and the Supply of Goods

Price Takers and the Competitive Process

Price-Searcher Markets With Low Entry Barriers

Price-Searcher Markets With High Entry Barriers

The Supply of and Demand for Productive Resources

Earnings, Productivity, and the Job Market

Investment, the Capital Market, and the Wealth of Nations

Income Inequality and Poverty

Gaining From International Trade

Filters

There are no graphics questions for this chapter.