Question 1

Positive and normative statements differ in that

Accepted Answer

A)  positive statements can be tested, whereas normative statements cannot. 
B)  normative statements can be tested, whereas positive statements cannot. 
C)  normative statements depict "what is" and positive statements depict "what ought to be." 
D)  normative statements never use the word "should." 
A)  positive statements can be tested, whereas normative statements cannot. 
B)  normative statements can be tested, whereas positive statements cannot. 
C)  normative statements depict "what is" and positive statements depict "what ought to be." 
D)  normative statements never use the word "should."

Question 2

If a large change in the variable measured on the x-axis is associated with a small change of the variable measured on the y-axis, the line is ________ and the slope is ________.

Accepted Answer

A)  downward-sloping; large 
B)  downward-sloping; small 
C)  upward-sloping; small 
D)  either downward or upward-sloping; small 
A)  downward-sloping; large 
B)  downward-sloping; small 
C)  upward-sloping; small 
D)  either downward or upward-sloping; small

Question 3

-In the above, as the y variable increases

Accepted Answer

A)  the x variable is constant. 
B)  the x variable increases. 
C)  the x variable decreases. 
D)  the x variable at first increases but then decreases. 
A)  the x variable is constant. 
B)  the x variable increases. 
C)  the x variable decreases. 
D)  the x variable at first increases but then decreases.

Question 4

The economic resource that organizes the use of other economic resources is called

Accepted Answer

A)  labor. 
B)  capital. 
C)  entrepreneurship. 
D)  land. 
A)  labor. 
B)  capital. 
C)  entrepreneurship. 
D)  land.

Question 5

Suppose that the government of New York state promises to decrease taxes to a firm if it decides to stay in New York instead of moving to another state. This policy on the part of the state constitutes ________, to make the ________ of the firm remaining in New York.

Accepted Answer

A)  an incentive; marginal benefit exceed the marginal cost 
B)  an incentive; marginal cost exceed the marginal benefit 
C)  a command; marginal benefit exceed the marginal cost 
D)  a command; marginal cost exceed the marginal benefit 
A)  an incentive; marginal benefit exceed the marginal cost 
B)  an incentive; marginal cost exceed the marginal benefit 
C)  a command; marginal benefit exceed the marginal cost 
D)  a command; marginal cost exceed the marginal benefit

Question 6

-If we use the numbers in the above table to draw a graph, with the price on the vertical axis and the quantity on the horizontal axis, the line relating price and quantity has a slope of

Accepted Answer

A)  0.8. 
B)  -8.0. 
C)  -1.25. 
D)  8.0. 
A)  0.8. 
B)  -8.0. 
C)  -1.25. 
D)  8.0.

Question 7

-In the table above, Y is measured along the y-axis and X along the x-axis. The slope between points c and d is

Accepted Answer

A)  100. 
B)  0. 
C)  0.25. 
D)  -4. 
A)  100. 
B)  0. 
C)  0.25. 
D)  -4.

Question 8

-In the above figure, if there is a negative relationship between the variables x and y, which of the graphs above can be used to indicate this?

Accepted Answer

A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  both Figure A and Figure C 
A)  Figure A 
B)  Figure B 
C)  Figure C 
D)  both Figure A and Figure C

Question 9

-The slope of the line shown in the above figure is

Accepted Answer

A)  -1 1/3. 
B)  -1 2/3. 
C)  -1.25. 
D)  -0.80. 
A)  -1 1/3. 
B)  -1 2/3. 
C)  -1.25. 
D)  -0.80.

Question 10

To graph a relationship that involves more than two variables, we use the "ceteris paribus" assumption.

Accepted Answer

A) True 
 B)False

Question 11

The income earned by the people who sell the services of the factor of production ________ is called ________.

Accepted Answer

A)  capital; rent 
B)  entrepreneurship; wages 
C)  land; profit 
D)  entrepreneurship; profit 
A)  capital; rent 
B)  entrepreneurship; wages 
C)  land; profit 
D)  entrepreneurship; profit

Question 12

The study of economics

Accepted Answer

A)  focuses mainly on individual consumers. 
B)  arises from the fact that our wants exceed available resources. 
C)  recognizes that scarcity does not affect rich nations. 
D)  deals mainly with microeconomics. 
A)  focuses mainly on individual consumers. 
B)  arises from the fact that our wants exceed available resources. 
C)  recognizes that scarcity does not affect rich nations. 
D)  deals mainly with microeconomics.

Question 13

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

Accepted Answer

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

Question 14

You notice that when the inflation rate increases, the interest rate tends to increase. This observation indicates that

Accepted Answer

A)  there might be false causality between inflation and the interest rate. 
B)  higher inflation rates must cause a higher interest rate. 
C)  a scatter diagram of the inflation rate and the interest rate will show a positive relationship. 
D)  the variables have an inverse relationship. 
A)  there might be false causality between inflation and the interest rate. 
B)  higher inflation rates must cause a higher interest rate. 
C)  a scatter diagram of the inflation rate and the interest rate will show a positive relationship. 
D)  the variables have an inverse relationship.

Question 15

Because we face scarcity, every choice involves

Accepted Answer

A)  money. 
B)  the question "what." 
C)  giving up something for nothing. 
D)  an opportunity cost. 
A)  money. 
B)  the question "what." 
C)  giving up something for nothing. 
D)  an opportunity cost.

Question 16

If the slope of a line that graphs the relationship between variable x and variable y is positive, then we know that

Accepted Answer

A)  when the value of variable x increases, then the value of variable y decreases. 
B)  when the value of variable x decreases, then the value of variable y decreases. 
C)  the two variables are unrelated. 
D)  the two variables have an inverse relationship. 
A)  when the value of variable x increases, then the value of variable y decreases. 
B)  when the value of variable x decreases, then the value of variable y decreases. 
C)  the two variables are unrelated. 
D)  the two variables have an inverse relationship.

Question 17

A normative statement is

Accepted Answer

A)  about what ought to be. 
B)  about what is. 
C)  always true. 
D)  one that does not use marginal concepts. 
A)  about what ought to be. 
B)  about what is. 
C)  always true. 
D)  one that does not use marginal concepts.

Question 18

The statement "Managers with a college education earn $18 an hour while ski instructors who did not complete college earn $10" is

Accepted Answer

A)  a political statement. 
B)  a positive statement. 
C)  a normative statement. 
D)  an ethical statement. 
A)  a political statement. 
B)  a positive statement. 
C)  a normative statement. 
D)  an ethical statement.

Question 19

When the government hires people to serve in the army, these people are no longer available to do other work. This choice illustrates the concept of

Accepted Answer

A)  an incentive. 
B)  a social interest/private interest conflict. 
C)  opportunity cost. 
D)  marginal benefit. 
A)  an incentive. 
B)  a social interest/private interest conflict. 
C)  opportunity cost. 
D)  marginal benefit.

Question 20

When the president of the Bank of America addresses Congress regarding lending standards in that industry, he is discussing

Accepted Answer

A)  a macroeconomic topic. 
B)  a microeconomic topic. 
C)  incentives. 
D)  the big tradeoff. 
A)  a macroeconomic topic. 
B)  a microeconomic topic. 
C)  incentives. 
D)  the big tradeoff.

Positive and normative statements differ in that

If a large change in the variable measured on the x-axis is associated with a small change of the variable measured on the y-axis, the line is and the slope is .

-In the above, as the y variable increases

The economic resource that organizes the use of other economic resources is called

Suppose that the government of New York state promises to decrease taxes to a firm if it decides to stay in New York instead of moving to another state. This policy on the part of the state constitutes , to make the of the firm remaining in New York.

-If we use the numbers in the above table to draw a graph, with the price on the vertical axis and the quantity on the horizontal axis, the line relating price and quantity has a slope of

-In the table above, Y is measured along the y-axis and X along the x-axis. The slope between points c and d is

-In the above figure, if there is a negative relationship between the variables x and y, which of the graphs above can be used to indicate this?

-The slope of the line shown in the above figure is

To graph a relationship that involves more than two variables, we use the "ceteris paribus" assumption.

The income earned by the people who sell the services of the factor of production is called .

The study of economics

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

You notice that when the inflation rate increases, the interest rate tends to increase. This observation indicates that

Because we face scarcity, every choice involves

If the slope of a line that graphs the relationship between variable x and variable y is positive, then we know that

A normative statement is

The statement "Managers with a college education earn $18 an hour while ski instructors who did not complete college earn $10" is

When the government hires people to serve in the army, these people are no longer available to do other work. This choice illustrates the concept of

When the president of the Bank of America addresses Congress regarding lending standards in that industry, he is discussing

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 1: What Is Economics

Positive and normative statements differ in that

If a large change in the variable measured on the x-axis is associated with a small change of the variable measured on the y-axis, the line is ________ and the slope is ________.

-In the above, as the y variable increases

The economic resource that organizes the use of other economic resources is called

Suppose that the government of New York state promises to decrease taxes to a firm if it decides to stay in New York instead of moving to another state. This policy on the part of the state constitutes ________, to make the ________ of the firm remaining in New York.

-If we use the numbers in the above table to draw a graph, with the price on the vertical axis and the quantity on the horizontal axis, the line relating price and quantity has a slope of

-In the table above, Y is measured along the y-axis and X along the x-axis. The slope between points c and d is

-In the above figure, if there is a negative relationship between the variables x and y, which of the graphs above can be used to indicate this?

-The slope of the line shown in the above figure is

To graph a relationship that involves more than two variables, we use the "ceteris paribus" assumption.

The income earned by the people who sell the services of the factor of production ________ is called ________.

The study of economics

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

You notice that when the inflation rate increases, the interest rate tends to increase. This observation indicates that

Because we face scarcity, every choice involves

If the slope of a line that graphs the relationship between variable x and variable y is positive, then we know that

A normative statement is

The statement "Managers with a college education earn $18 an hour while ski instructors who did not complete college earn $10" is

When the government hires people to serve in the army, these people are no longer available to do other work. This choice illustrates the concept of

When the president of the Bank of America addresses Congress regarding lending standards in that industry, he is discussing

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

If a large change in the variable measured on the x-axis is associated with a small change of the variable measured on the y-axis, the line is and the slope is .

Suppose that the government of New York state promises to decrease taxes to a firm if it decides to stay in New York instead of moving to another state. This policy on the part of the state constitutes , to make the of the firm remaining in New York.

The income earned by the people who sell the services of the factor of production is called .