Question 1

How do we find the slope of a nonlinear curve?

Accepted Answer

We can find the slope at a given point b

Question 2

Which statement about an economy's resources is the most accurate?

Accepted Answer

A)  They consist of land, labour, capital, and entrepreneurial skills. 
B)  They consist of land, labour, and entrepreneurial skills, but not capital. 
C)  They are always efficiently utilized in wealthy nations. 
D)  They are unlimited in a country like Canada. 
A)  They consist of land, labour, capital, and entrepreneurial skills. 
B)  They consist of land, labour, and entrepreneurial skills, but not capital. 
C)  They are always efficiently utilized in wealthy nations. 
D)  They are unlimited in a country like Canada.

Question 3

Most disagreements among economists stem from normative issues.

Accepted Answer

A) True 
 B)False

Question 4

What is implied by the expression, "There's no such thing as a free lunch"?

Accepted Answer

A)  Costs are incurred when resources are used to produce goods and services. 
B)  No one has time for a good lunch anymore. 
C)  The person consuming a good must always pay for it. 
D)  Everyone has to pay for his/her own lunch. 
A)  Costs are incurred when resources are used to produce goods and services. 
B)  No one has time for a good lunch anymore. 
C)  The person consuming a good must always pay for it. 
D)  Everyone has to pay for his/her own lunch.

Question 5

What type of science do most people consider economics to be?

Accepted Answer

A)  a social science 
B)  an accounting science 
C)  a physical science 
D)  an earth science 
A)  a social science 
B)  an accounting science 
C)  a physical science 
D)  an earth science

Question 6

How would an economist respond to the following statement: "Wanting more goods makes us greedy"?

Accepted Answer

Economists do not view the unlimited hum

Question 7

What is the basic difference between macroeconomics and microeconomics?

Accepted Answer

A)  Microeconomics is concerned with the trees (individual markets), while macroeconomics is concerned with the forest (aggregate markets). 
B)  Macroeconomics is concerned with positive economics, while microeconomics is concerned with normative economics. 
C)  Macroeconomics is concerned with policy decisions, while microeconomics applies only to theory. 
D)  Microeconomics looks at the forest (aggregate markets), while macroeconomics is concerned with the trees (individual markets). 
A)  Microeconomics is concerned with the trees (individual markets), while macroeconomics is concerned with the forest (aggregate markets). 
B)  Macroeconomics is concerned with positive economics, while microeconomics is concerned with normative economics. 
C)  Macroeconomics is concerned with policy decisions, while microeconomics applies only to theory. 
D)  Microeconomics looks at the forest (aggregate markets), while macroeconomics is concerned with the trees (individual markets).

Question 8

What is the basis of a good economic theory?

Accepted Answer

A)  It relies on simplifying assumptions in order to explain economic behaviour. 
B)  It does not rely on simplifying assumptions. 
C)  It includes every detail that affects the economic behaviour of interest. 
D)  It relies on conducting uncontrolled experiments. 
A)  It relies on simplifying assumptions in order to explain economic behaviour. 
B)  It does not rely on simplifying assumptions. 
C)  It includes every detail that affects the economic behaviour of interest. 
D)  It relies on conducting uncontrolled experiments.

Question 9

Which of the following is likely to provide teenagers with the greatest incentive NOT to smoke?

Accepted Answer

A)  a law prohibiting anyone from smoking in public buildings 
B)  a $2.00 per-pack tax on cigarettes 
C)  a public service television advertisement featuring singer Jennifer Lopez urging kids to refrain from smoking 
D)  a refusal by actor Leonardo DiCaprio to play any part in which he will be seen smoking 
A)  a law prohibiting anyone from smoking in public buildings 
B)  a $2.00 per-pack tax on cigarettes 
C)  a public service television advertisement featuring singer Jennifer Lopez urging kids to refrain from smoking 
D)  a refusal by actor Leonardo DiCaprio to play any part in which he will be seen smoking

Question 10

Which of the following best illustrates the fallacy of composition?

Accepted Answer

A)  If Mr. Ahmad had more money, he would buy a new car; if he had a new car, he would have less money. 
B)  If Mr. Mua had more money, he could buy more goods; if the Mua family had more money, it could buy additional goods. 
C)  If Ms. Smith had more money, she would buy her children more gifts; if her children had more gifts, they would be happier. 
D)  If Ms. Shiflet had more money, she could buy more scarce goods; if the nation had more money, everyone could buy more scarce goods. 
A)  If Mr. Ahmad had more money, he would buy a new car; if he had a new car, he would have less money. 
B)  If Mr. Mua had more money, he could buy more goods; if the Mua family had more money, it could buy additional goods. 
C)  If Ms. Smith had more money, she would buy her children more gifts; if her children had more gifts, they would be happier. 
D)  If Ms. Shiflet had more money, she could buy more scarce goods; if the nation had more money, everyone could buy more scarce goods.

Question 11

The marginal benefits to Roberto of weekend vacations during the year at a local resort are given by the following schedule:
TABLE 1-2
  
-Refer to Table 1-2. If the marginal cost of a weekend vacation at the local resort is constant and equal to $350, how many weekends at the local resort is Roberto likely to enjoy?

Accepted Answer

A)  2 
B)  3 
C)  4 
D)  5 
A)  2 
B)  3 
C)  4 
D)  5

Question 12

In markets, how is information about the relative value of resources communicated?

Accepted Answer

A)  through unions 
B)  through planning committees 
C)  through prices 
D)  through government agencies 
A)  through unions 
B)  through planning committees 
C)  through prices 
D)  through government agencies

Question 13

As defined by an economist, what does the word scarcity mean?

Accepted Answer

A)  Consumers are too poor to purchase the available goods and services. 
B)  Demand exceeds supply at the current market price. 
C)  The desire for goods exceeds our ability to produce them with limited available resources. 
D)  Supply exceeds demand at the current market price. 
A)  Consumers are too poor to purchase the available goods and services. 
B)  Demand exceeds supply at the current market price. 
C)  The desire for goods exceeds our ability to produce them with limited available resources. 
D)  Supply exceeds demand at the current market price.

Question 14

The price of a ticket to the latest concert is $80. According to an economist, under what circumstances will you purchase a ticket?

Accepted Answer

A)  when you place a lower valuation on seeing the concert than $80 but are extremely bored 
B)  when your marginal benefit of going to the concert is positive 
C)  when your expected marginal benefit from viewing the concert exceeds $80 
D)  when your expected marginal cost from viewing the concert exceeds $80 
A)  when you place a lower valuation on seeing the concert than $80 but are extremely bored 
B)  when your marginal benefit of going to the concert is positive 
C)  when your expected marginal benefit from viewing the concert exceeds $80 
D)  when your expected marginal cost from viewing the concert exceeds $80

Question 15

Which topic does microeconomics NOT usually include?

Accepted Answer

A)  the determinants of the demand for DVD players by consumers 
B)  the impact of large government budget deficits on private investment spending 
C)  the regulation of monopoly firms 
D)  the determinants of the supply of wheat by farmers 
A)  the determinants of the demand for DVD players by consumers 
B)  the impact of large government budget deficits on private investment spending 
C)  the regulation of monopoly firms 
D)  the determinants of the supply of wheat by farmers

Question 16

Prices communicate information about the relative value of resources in the marketplace. Which of the following would cause the value and, hence, the price of oranges to rise?
a.A freeze wipes out half of the Florida citrus groves.
b.Orange juice is shown to reduce blood cholesterol levels.
c.The price of grape, cranberry, and pineapple juice falls dramatically.

Accepted Answer

a) and b) would result in higher orange

Question 17

Which of the following best describes macroeconomics?

Accepted Answer

A)  It is narrower in scope than microeconomics. 
B)  It is concerned with the expansion of a small sole proprietorship into a large corporation. 
C)  It is concerned with the expansion and contraction of the overall economy. 
D)  It analyzes mergers and acquisitions between firms. 
A)  It is narrower in scope than microeconomics. 
B)  It is concerned with the expansion of a small sole proprietorship into a large corporation. 
C)  It is concerned with the expansion and contraction of the overall economy. 
D)  It analyzes mergers and acquisitions between firms.

Question 18

Why do people specialize?

Accepted Answer

A)  so that society becomes wealthier while not using their resources 
B)  so that people avoid having to trade 
C)  so that individuals can increase their opportunity cost for an activity 
D)  so that individuals make the best use of resources by devoting themselves to one primary productive activity 
A)  so that society becomes wealthier while not using their resources 
B)  so that people avoid having to trade 
C)  so that individuals can increase their opportunity cost for an activity 
D)  so that individuals make the best use of resources by devoting themselves to one primary productive activity

Question 19

Which of the following statements about scarcity is the most accurate?

Accepted Answer

A)  It occurs only in centrally planned economies. 
B)  It will likely be eliminated by technological progress. 
C)  It occurs if there are insufficient resources to provide for human wants. 
D)  It exists only in poor nations. 
A)  It occurs only in centrally planned economies. 
B)  It will likely be eliminated by technological progress. 
C)  It occurs if there are insufficient resources to provide for human wants. 
D)  It exists only in poor nations.

Question 20

If rain dancing is correlated with rain, does that necessarily mean rain dancing causes rain?

Accepted Answer

A)  No. This is an example of the fallacy of composition. 
B)  No. Two variables may be correlated without one necessarily causing the other. 
C)  Yes. This is an example of a failure to properly employ the ceteris paribus assumption. 
D)  Yes. If it rains after individuals have engaged in rain dancing, then there is certainly causation at work. 
A)  No. This is an example of the fallacy of composition. 
B)  No. Two variables may be correlated without one necessarily causing the other. 
C)  Yes. This is an example of a failure to properly employ the ceteris paribus assumption. 
D)  Yes. If it rains after individuals have engaged in rain dancing, then there is certainly causation at work.

How do we find the slope of a nonlinear curve?

Which statement about an economy's resources is the most accurate?

Most disagreements among economists stem from normative issues.

What is implied by the expression, "There's no such thing as a free lunch"?

What type of science do most people consider economics to be?

How would an economist respond to the following statement: "Wanting more goods makes us greedy"?

What is the basic difference between macroeconomics and microeconomics?

What is the basis of a good economic theory?

Which of the following is likely to provide teenagers with the greatest incentive NOT to smoke?

Which of the following best illustrates the fallacy of composition?

In markets, how is information about the relative value of resources communicated?

As defined by an economist, what does the word scarcity mean?

The price of a ticket to the latest concert is $80. According to an economist, under what circumstances will you purchase a ticket?

Which topic does microeconomics NOT usually include?

Which of the following best describes macroeconomics?

Why do people specialize?

Which of the following statements about scarcity is the most accurate?

If rain dancing is correlated with rain, does that necessarily mean rain dancing causes rain?

Scarcity, Trade-Offs, and Production Possibilities

Supply and Demand

Bringing Supply and Demand Together

Elasticity

Market Efficiency and Market Failure

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Labour Markets and the Distribution of Income

The Environment

Filters

Exam 1: The Role and Method of Economics

How do we find the slope of a nonlinear curve?

Which statement about an economy's resources is the most accurate?

Most disagreements among economists stem from normative issues.

What is implied by the expression, "There's no such thing as a free lunch"?

What type of science do most people consider economics to be?

How would an economist respond to the following statement: "Wanting more goods makes us greedy"?

What is the basic difference between macroeconomics and microeconomics?

What is the basis of a good economic theory?

Which of the following is likely to provide teenagers with the greatest incentive NOT to smoke?

Which of the following best illustrates the fallacy of composition?

In markets, how is information about the relative value of resources communicated?

As defined by an economist, what does the word scarcity mean?

The price of a ticket to the latest concert is $80. According to an economist, under what circumstances will you purchase a ticket?

Which topic does microeconomics NOT usually include?

Which of the following best describes macroeconomics?

Why do people specialize?

Which of the following statements about scarcity is the most accurate?

If rain dancing is correlated with rain, does that necessarily mean rain dancing causes rain?

Scarcity, Trade-Offs, and Production Possibilities

Supply and Demand

Bringing Supply and Demand Together

Elasticity

Market Efficiency and Market Failure

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Labour Markets and the Distribution of Income

The Environment

Filters