Question 1

Suppose two economists agree about who would be helped or hurt by certain legislation,but disagree about whether the legislation would be a good idea.These disagreements

Accepted Answer

A) are positive in nature 
B) are minor and rarely lead to different policies or conclusions 
C) are normative in nature 
D) occur as the result of a mistake made by an economist 
E) occur because economic models are more complex,and subject to error,than the real world 
A) are positive in nature 
B) are minor and rarely lead to different policies or conclusions 
C) are normative in nature 
D) occur as the result of a mistake made by an economist 
E) occur because economic models are more complex,and subject to error,than the real world

Question 2

The price of apples in Denver,Colorado is

Accepted Answer

A) a normative value judgment 
B) an example of a factor of production 
C) a microeconomic variable 
D) a macroeconomic variable 
E) not the sort of thing that economists would try to explain 
A) a normative value judgment 
B) an example of a factor of production 
C) a microeconomic variable 
D) a macroeconomic variable 
E) not the sort of thing that economists would try to explain

Question 3

Economic models typically assume that decision makers face constraints because of scarce resources.

Accepted Answer

A) True 
 B)False

Question 4

An assumption that affects a model in important ways is

Accepted Answer

A) a key step 
B) a simplifying assumption 
C) a bad assumption,one that should be avoided in economic theory 
D) a critical assumption 
E) one that should be replaced with empirical evidence 
A) a key step 
B) a simplifying assumption 
C) a bad assumption,one that should be avoided in economic theory 
D) a critical assumption 
E) one that should be replaced with empirical evidence

Question 5

Microeconomics analyzes individual parts of the economy rather than broad economic aggregates.

Accepted Answer

A) True 
 B)False

Question 6

Individuals must make choices because

Accepted Answer

A) resources are scarce and wants are limited 
B) resources and wants are unlimited 
C) assets and wealth are distributed unevenly 
D) resources are scarce and wants are unlimited 
E) inflation usually outpaces income growth 
A) resources are scarce and wants are limited 
B) resources and wants are unlimited 
C) assets and wealth are distributed unevenly 
D) resources are scarce and wants are unlimited 
E) inflation usually outpaces income growth

Question 7

The four main categories of resources are

Accepted Answer

A) labor,money,capital,and inputs 
B) capital,land,raw materials,and entrepreneurship 
C) raw materials,money,labor,and capital 
D) land,capital,labor,natural resources,and entrepreneurship 
E) human capital,physical capital,labor,and natural resources 
A) labor,money,capital,and inputs 
B) capital,land,raw materials,and entrepreneurship 
C) raw materials,money,labor,and capital 
D) land,capital,labor,natural resources,and entrepreneurship 
E) human capital,physical capital,labor,and natural resources

Question 8

Microeconomics is the branch of economics that concerns

Accepted Answer

A) the overall health of the economy 
B) the behavior of individual households,firms,and governments 
C) the overall level of trade between nations 
D) local governments only 
E) the general level of output 
A) the overall health of the economy 
B) the behavior of individual households,firms,and governments 
C) the overall level of trade between nations 
D) local governments only 
E) the general level of output

Question 9

Using economic analysis to help understand world issues

Accepted Answer

A) assumes that all decision makers use detailed economic analysis 
B) highlights the role of choice when resources are scarce 
C) has unlimited application 
D) is not appropriate because reality is too complex for economic modeling 
E) typically enables one nation to gain only when another nation loses 
A) assumes that all decision makers use detailed economic analysis 
B) highlights the role of choice when resources are scarce 
C) has unlimited application 
D) is not appropriate because reality is too complex for economic modeling 
E) typically enables one nation to gain only when another nation loses

Question 10

What does economics have in common with sociology?

Accepted Answer

A) Economics and sociology ask fundamentally the same questions. 
B) Economics and sociology use the same tools to analyze issues. 
C) Both are social sciences. 
D) What and how economists study is very similar to what and how sociologists study. 
E) Explaining something about society is only a secondary purpose in both areas. 
A) Economics and sociology ask fundamentally the same questions. 
B) Economics and sociology use the same tools to analyze issues. 
C) Both are social sciences. 
D) What and how economists study is very similar to what and how sociologists study. 
E) Explaining something about society is only a secondary purpose in both areas.

Question 11

A microeconomist might study which of the following?

Accepted Answer

A) the collapse of US financial markets in 2007-2009 
B) the causes of the Great Depression 
C) the movements of prices for unleaded gasoline 
D) the role of expectations in the determination of the level of real GDP 
E) the trade-off between inflation and unemployment 
A) the collapse of US financial markets in 2007-2009 
B) the causes of the Great Depression 
C) the movements of prices for unleaded gasoline 
D) the role of expectations in the determination of the level of real GDP 
E) the trade-off between inflation and unemployment

Question 12

A consultant who earns $100 per hour takes four hours off work to go to the movies.The
Out-of-pocket cost for the cab and the movie ticket are $12.The total cost of the movie to the consultant is

Accepted Answer

A) $12 
B) $412 
C) $400 
D) $388 
E) $112 
A) $12 
B) $412 
C) $400 
D) $388 
E) $112

Question 13

The economic behavior of government is constrained by

Accepted Answer

A) limited budgets 
B) the absence of prices on most government output 
C) moral philosophy of the community 
D) low voter participation rates 
E) political self interest 
A) limited budgets 
B) the absence of prices on most government output 
C) moral philosophy of the community 
D) low voter participation rates 
E) political self interest

Question 14

Suppose that the Council of Economic Advisers tells the President that "the unemployment rate is 4 percent." The President responds,"That rate is still too high." The President's statement is

Accepted Answer

A) a normative statement 
B) a positive statement 
C) empirically verifiable by checking economic data 
D) an indisputable statistical fact 
E) an incorrect positive statement 
A) a normative statement 
B) a positive statement 
C) empirically verifiable by checking economic data 
D) an indisputable statistical fact 
E) an incorrect positive statement

Question 15

The overall performance of the economic system as a whole is the focus of

Accepted Answer

A) international finance 
B) labor economics 
C) microeconomics 
D) macroeconomics 
E) public economics 
A) international finance 
B) labor economics 
C) microeconomics 
D) macroeconomics 
E) public economics

Question 16

The idea of opportunity cost suggests that the cost of a particular choice should be measured by the

Accepted Answer

A) price of the good chosen 
B) price of the good divided by income 
C) value of the best alternative sacrificed 
D) amount of the good consumed 
E) sum of the costs of all foregone opportunities 
A) price of the good chosen 
B) price of the good divided by income 
C) value of the best alternative sacrificed 
D) amount of the good consumed 
E) sum of the costs of all foregone opportunities

Question 17

The inflation rate for the economy as a whole is a

Accepted Answer

A) normative value judgment 
B) positive value judgment 
C) macroeconomic statistic 
D) microeconomic statistic 
E) critical assumption 
A) normative value judgment 
B) positive value judgment 
C) macroeconomic statistic 
D) microeconomic statistic 
E) critical assumption

Question 18

The opportunity cost of a particular activity

Accepted Answer

A) is the same for everyone pursuing this activity 
B) may include both monetary costs and forgone income 
C) always decreases as more of that activity is pursued 
D) usually is known with certainty 
E) measures the direct benefits of that activity 
A) is the same for everyone pursuing this activity 
B) may include both monetary costs and forgone income 
C) always decreases as more of that activity is pursued 
D) usually is known with certainty 
E) measures the direct benefits of that activity

Question 19

The basic problem of economics arises when there are unlimited resources available to fulfill society's limited wants.

Accepted Answer

A) True 
 B)False

Question 20

Economists disagree about whether increasing the minimum wage is a good idea,because they put different weight on the importance that the negative impacts have relative to the positive impacts.As such,the disagreements are usually over

Accepted Answer

A) normative issues 
B) positive issues 
C) the mathematical calculations in an economic model 
D) whether microeconomics or macroeconomics is more important 
E) whether economic theory is useful in explaining the behavior of actors in the economy 
A) normative issues 
B) positive issues 
C) the mathematical calculations in an economic model 
D) whether microeconomics or macroeconomics is more important 
E) whether economic theory is useful in explaining the behavior of actors in the economy

Suppose two economists agree about who would be helped or hurt by certain legislation,but disagree about whether the legislation would be a good idea.These disagreements

The price of apples in Denver,Colorado is

Economic models typically assume that decision makers face constraints because of scarce resources.

An assumption that affects a model in important ways is

Microeconomics analyzes individual parts of the economy rather than broad economic aggregates.

Individuals must make choices because

The four main categories of resources are

Microeconomics is the branch of economics that concerns

Using economic analysis to help understand world issues

What does economics have in common with sociology?

A microeconomist might study which of the following?

A consultant who earns $100 per hour takes four hours off work to go to the movies.The Out-of-pocket cost for the cab and the movie ticket are $12.The total cost of the movie to the consultant is

The economic behavior of government is constrained by

Suppose that the Council of Economic Advisers tells the President that "the unemployment rate is 4 percent." The President responds,"That rate is still too high." The President's statement is

The overall performance of the economic system as a whole is the focus of

The idea of opportunity cost suggests that the cost of a particular choice should be measured by the

The inflation rate for the economy as a whole is a

The opportunity cost of a particular activity

The basic problem of economics arises when there are unlimited resources available to fulfill society's limited wants.

Economists disagree about whether increasing the minimum wage is a good idea,because they put different weight on the importance that the negative impacts have relative to the positive impacts.As such,the disagreements are usually over

Scarcity, choice, and Economic Systems

Supply and Demand

Working With Supply and Demand

Elasticity

Consumer Choice

Production and Cost

How Firms Make Decisions: Profit Maximization

Perfect Competition

B:Perfect Competition

Monopolistic Competition and Oligopoly

Monopoly

Labor Markets

B: Labor Markets

Capital and Financial Markets

Economic Efficiency and the Competitive Ideal

Governments Role in Economic Efficiency

Comparative Advantage and the Gains From International Trade

Filters

Exam 1: What Is Economics

Suppose two economists agree about who would be helped or hurt by certain legislation,but disagree about whether the legislation would be a good idea.These disagreements

The price of apples in Denver,Colorado is

Economic models typically assume that decision makers face constraints because of scarce resources.

An assumption that affects a model in important ways is

Microeconomics analyzes individual parts of the economy rather than broad economic aggregates.

Individuals must make choices because

The four main categories of resources are

Microeconomics is the branch of economics that concerns

Using economic analysis to help understand world issues

What does economics have in common with sociology?

A microeconomist might study which of the following?

A consultant who earns $100 per hour takes four hours off work to go to the movies.The Out-of-pocket cost for the cab and the movie ticket are $12.The total cost of the movie to the consultant is

The economic behavior of government is constrained by

Suppose that the Council of Economic Advisers tells the President that "the unemployment rate is 4 percent." The President responds,"That rate is still too high." The President's statement is

The overall performance of the economic system as a whole is the focus of

The idea of opportunity cost suggests that the cost of a particular choice should be measured by the

The inflation rate for the economy as a whole is a

The opportunity cost of a particular activity

The basic problem of economics arises when there are unlimited resources available to fulfill society's limited wants.

Economists disagree about whether increasing the minimum wage is a good idea,because they put different weight on the importance that the negative impacts have relative to the positive impacts.As such,the disagreements are usually over

Scarcity, choice, and Economic Systems

Supply and Demand

Working With Supply and Demand

Elasticity

Consumer Choice

Production and Cost

How Firms Make Decisions: Profit Maximization

Perfect Competition

B:Perfect Competition

Monopolistic Competition and Oligopoly

Monopoly

Labor Markets

B: Labor Markets

Capital and Financial Markets

Economic Efficiency and the Competitive Ideal

Governments Role in Economic Efficiency

Comparative Advantage and the Gains From International Trade

Filters