Question 1

The high unemployment of 2008-2010 caused a substantial decrease in inflation, which created fears of deflation.

Accepted Answer

A) True 
 B)False

Question 2

Economics is a social science rather than a "hard" science like physics because

Accepted Answer

A)  economists abstract from reality when creating their theories. 
B)  economics is easier to study than physics. 
C)  economists must explain their theories to policy makers who lack formal mathematical training. 
D)  economists study human behavior, which is affected by an unpredictable and vast range of influences. 
A)  economists abstract from reality when creating their theories. 
B)  economics is easier to study than physics. 
C)  economists must explain their theories to policy makers who lack formal mathematical training. 
D)  economists study human behavior, which is affected by an unpredictable and vast range of influences.

Question 3

A line that rises from left to right has a positive slope.

Accepted Answer

A) True 
 B)False

Question 4

An introductory course in economics should allow a student to

Accepted Answer

A)  turn into an economist. 
B)  develop solutions to most social problems. 
C)  answer all complex social questions. 
D)  make rational decisions. 
E)  All of these responses are correct. 
A)  turn into an economist. 
B)  develop solutions to most social problems. 
C)  answer all complex social questions. 
D)  make rational decisions. 
E)  All of these responses are correct.

Question 5

A graph with a positive slope indicates that the variables depicted on the axes move in the same directions.

Accepted Answer

A) True 
 B)False

Question 6

A line that rises at a 45 degree angle has a slope of

Accepted Answer

A)  0.45. 
B)  1. 
C)  45. 
D)  1/45. 
A)  0.45. 
B)  1. 
C)  45. 
D)  1/45.

Question 7

Models are used to describe cause-and-effect relationships.

Accepted Answer

A) True 
 B)False

Question 8

Economic models are often expressed in

Accepted Answer

A)  equations. 
B)  words. 
C)  graphs. 
D)  physical objects. 
A)  equations. 
B)  words. 
C)  graphs. 
D)  physical objects.

Question 9

Carefully define the following terms and explain their importance. 
a. Variable 
b. Ray 
c. Slope 
d. Contour map

Accepted Answer

a. A variable is an object, such as pric

Question 10

Why do economists abstract, and is it appropriate?

Accepted Answer

Economists (and other scientists) abstra

Question 11

One of the consequences of allowing wages to fall in the United States has been growing wage inequality.

Accepted Answer

A) True 
 B)False

Question 12

Suppose that one can read a graph that shows information about price and quantity of some product. Relying solely on the graph, is it possible to explain the relationship between the two variables?

Accepted Answer

No. The graph does not, by its

Question 13

Eliminating important details in economic analysis is necessary to understand the complexity of the economy.

Accepted Answer

A) True 
 B)False

Question 14

Comparative advantage explains how two nations can benefit from trade.

Accepted Answer

A) True 
 B)False

Question 15

The process of focusing on only the most important factors to explain a phenomenon is called

Accepted Answer

A)  abstraction. 
B)  marginal analysis. 
C)  rational choice. 
D)  controlled experimentation. 
E)  the trade-off between efficiency and equality. 
A)  abstraction. 
B)  marginal analysis. 
C)  rational choice. 
D)  controlled experimentation. 
E)  the trade-off between efficiency and equality.

Question 16

Some economists develop theories concerning policy issues to

Accepted Answer

A)  further their own political agendas. 
B)  understand what happened in an earlier time period. 
C)  describe current economic events. 
D)  make sound recommendations about policy alternatives. 
E)  help elect new government officials. 
A)  further their own political agendas. 
B)  understand what happened in an earlier time period. 
C)  describe current economic events. 
D)  make sound recommendations about policy alternatives. 
E)  help elect new government officials.

Question 17

In economics, abstraction from reality is necessary because of the complexity of the real world.

Accepted Answer

A) True 
 B)False

Question 18

People generally purchase less of a commodity as its price increases. This implies that the relationship between quantity purchased and the price of the commodity must have a

Accepted Answer

A)  slope always equal to one. 
B)  positive slope. 
C)  zero slope. 
D)  negative slope. 
A)  slope always equal to one. 
B)  positive slope. 
C)  zero slope. 
D)  negative slope.

Question 19

If you go to the movies on Thursday night, the only cost to you is the price you pay for the movie ticket.

Accepted Answer

A) True 
 B)False

Question 20

When a teacher in a private school points out to her high school principal that since there are empty seats in all classrooms, the cost of additional students is really zero, she is using the

Accepted Answer

A)  law of comparative advantage. 
B)  principle of marginal analysis. 
C)  theory of externalities. 
D)  notion of the cost decreases of the service sector. 
E)  concept of opportunity cost. 
A)  law of comparative advantage. 
B)  principle of marginal analysis. 
C)  theory of externalities. 
D)  notion of the cost decreases of the service sector. 
E)  concept of opportunity cost.

Exam 1: What Is Economics

The high unemployment of 2008-2010 caused a substantial decrease in inflation, which created fears of deflation.

Economics is a social science rather than a "hard" science like physics because

A line that rises from left to right has a positive slope.

An introductory course in economics should allow a student to

A graph with a positive slope indicates that the variables depicted on the axes move in the same directions.

A line that rises at a 45 degree angle has a slope of

Models are used to describe cause-and-effect relationships.

Economic models are often expressed in

Carefully define the following terms and explain their importance. a. Variable b. Ray c. Slope d. Contour map

Why do economists abstract, and is it appropriate?

One of the consequences of allowing wages to fall in the United States has been growing wage inequality.

Suppose that one can read a graph that shows information about price and quantity of some product. Relying solely on the graph, is it possible to explain the relationship between the two variables?

Eliminating important details in economic analysis is necessary to understand the complexity of the economy.

Comparative advantage explains how two nations can benefit from trade.

The process of focusing on only the most important factors to explain a phenomenon is called

Some economists develop theories concerning policy issues to

In economics, abstraction from reality is necessary because of the complexity of the real world.

People generally purchase less of a commodity as its price increases. This implies that the relationship between quantity purchased and the price of the commodity must have a

If you go to the movies on Thursday night, the only cost to you is the price you pay for the movie ticket.

When a teacher in a private school points out to her high school principal that since there are empty seats in all classrooms, the cost of additional students is really zero, she is using the

The Economy: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation

Bringing in the Supply Side: Unemployment and Inflation

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder

Exchange Rates and the Macroeconomy

Contemporary Issues in the Us Economy

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