Question 1

As a student, one of the costs of sleeping in rather than going to class is likely to be a lower grade in the class.

Accepted Answer

A) True 
 B)False

Question 2

What are the tools available to governments to mitigate cycles of boom and bust?
 Why do these tools fail?

Accepted Answer

Some of the tools available to the gover

Question 3

A horizontal line has a slope of 0.

Accepted Answer

A) True 
 B)False

Question 4

Harry Truman is credited with the statement, "Give me a one-armed economist," because economists are likely to say, "On the one hand, ...on the other hand." Why do economists "waffle" more than physicists or chemists?

Accepted Answer

Economists describe human behavior, whic

Question 5

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

Accepted Answer

A) True 
 B)False

Question 6

Economic problems are made manageable by stripping away some of the unnecessary details.

Accepted Answer

A) True 
 B)False

Question 7

Because there is a trade-off between inflation and unemployment in the short run,

Accepted Answer

A) lower unemployment will typically cause inflation to fall. 
B) policies designed to reduce unemployment will typically set off a recession. 
C) policies designed to reduce inflation will cause unemployment to fall as well. 
D) higher inflation will generally be associated with higher unemployment. 
E) lower inflation will generally be associated with higher unemployment. 
A) lower unemployment will typically cause inflation to fall. 
B) policies designed to reduce unemployment will typically set off a recession. 
C) policies designed to reduce inflation will cause unemployment to fall as well. 
D) higher inflation will generally be associated with higher unemployment. 
E) lower inflation will generally be associated with higher unemployment.

Question 8

If an economic curve has a negative slope, then one variable

Accepted Answer

A) falls as the other rises. 
B) changes at a slower rate than another. 
C) has a smaller value than another. 
D) changes after another variable. 
A) falls as the other rises. 
B) changes at a slower rate than another. 
C) has a smaller value than another. 
D) changes after another variable.

Question 9

"Assume that all individuals have perfect information about prices now and in the future, that they have identical tastes, that all markets are competitive, and that there is no government." This statement is indicative of how economists

Accepted Answer

A) apply the law of supply and demand. 
B) employ marginal analysis. 
C) are prevented from getting correct answers. 
D) abstract for analytic purposes. 
E) use realistic assumptions to develop theory. 
A) apply the law of supply and demand. 
B) employ marginal analysis. 
C) are prevented from getting correct answers. 
D) abstract for analytic purposes. 
E) use realistic assumptions to develop theory.

Question 10

What is the role of value judgments in economic analysis?

Accepted Answer

Economists employ value judgments in mak

Question 11

One of the consequences of preventing wages from falling in the European Union has been growing unemployment.

Accepted Answer

A) True 
 B)False

Question 12

In contrast to the United States, the European Union has chosen

Accepted Answer

A) greater wage inequality for lower unemployment. 
B) less wage inequality and lower unemployment. 
C) greater wage inequality and higher unemployment. 
D) similar wage inequality but more unemployment. 
E) less wage inequality for higher unemployment. 
A) greater wage inequality for lower unemployment. 
B) less wage inequality and lower unemployment. 
C) greater wage inequality and higher unemployment. 
D) similar wage inequality but more unemployment. 
E) less wage inequality for higher unemployment.

Question 13

Economics is a social science in the sense that it

Accepted Answer

A) rigorously examines human behavior. 
B) is not as scientific as physics. 
C) relies on historical data instead of mathematical data. 
D) relies on statistics instead of mathematics. 
E) All of the above are correct. 
A) rigorously examines human behavior. 
B) is not as scientific as physics. 
C) relies on historical data instead of mathematical data. 
D) relies on statistics instead of mathematics. 
E) All of the above are correct.

Question 14

"Correlation" is a measure of how one variable causes another to change.

Accepted Answer

A) True 
 B)False

Question 15

In the short run, efforts to reduce the unemployment rate are likely to cause

Accepted Answer

A) a decrease in the inflation rate. 
B) an increase in the inflation rate. 
C) no change in the inflation rate. 
D) Uncertain-economists have found no relationship between the two variables. 
A) a decrease in the inflation rate. 
B) an increase in the inflation rate. 
C) no change in the inflation rate. 
D) Uncertain-economists have found no relationship between the two variables.

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

In international trade, one country's gain is another country's loss.

Accepted Answer

A) True 
 B)False

Question 18

The marginal cost of an airline ticket is the total cost of flying the plane divided by the number of passengers.

Accepted Answer

A) True 
 B)False

Question 19

The United States produces both automobiles and computers more efficiently than Mexico.Nevertheless, it is possible that both nations would benefit from trade in these items.The reason for this is

Accepted Answer

A) the law of comparative advantage. 
B) the inflation-unemployment trade-off. 
C) externalities. 
D) the cost disease of personal services. 
E) attempts to repeal the law of supply and demand. 
A) the law of comparative advantage. 
B) the inflation-unemployment trade-off. 
C) externalities. 
D) the cost disease of personal services. 
E) attempts to repeal the law of supply and demand.

Question 20

To an economist, the cost of a college education

Accepted Answer

A) includes the income that the student could have earned during the time spent in college. 
B) can be measured solely by the dollar cost of tuition, books, and other fees. 
C) includes only the cost of schooling, not the cost of housing and food. 
D) excludes financial aid in computation of the cost of schooling. 
E) All of the above are correct. 
A) includes the income that the student could have earned during the time spent in college. 
B) can be measured solely by the dollar cost of tuition, books, and other fees. 
C) includes only the cost of schooling, not the cost of housing and food. 
D) excludes financial aid in computation of the cost of schooling. 
E) All of the above are correct.

Exam 1: What Is Economics

As a student, one of the costs of sleeping in rather than going to class is likely to be a lower grade in the class.

What are the tools available to governments to mitigate cycles of boom and bust? Why do these tools fail?

A horizontal line has a slope of 0.

Harry Truman is credited with the statement, "Give me a one-armed economist," because economists are likely to say, "On the one hand, ...on the other hand." Why do economists "waffle" more than physicists or chemists?

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

Economic problems are made manageable by stripping away some of the unnecessary details.

Because there is a trade-off between inflation and unemployment in the short run,

If an economic curve has a negative slope, then one variable

"Assume that all individuals have perfect information about prices now and in the future, that they have identical tastes, that all markets are competitive, and that there is no government." This statement is indicative of how economists

What is the role of value judgments in economic analysis?

One of the consequences of preventing wages from falling in the European Union has been growing unemployment.

In contrast to the United States, the European Union has chosen

Economics is a social science in the sense that it

"Correlation" is a measure of how one variable causes another to change.

In the short run, efforts to reduce the unemployment rate are likely to cause

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

In international trade, one country's gain is another country's loss.

The marginal cost of an airline ticket is the total cost of flying the plane divided by the number of passengers.

The United States produces both automobiles and computers more efficiently than Mexico.Nevertheless, it is possible that both nations would benefit from trade in these items.The reason for this is

To an economist, the cost of a college education

The Economy: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: the Importance of Marginal Analysis

Securities: Business Finance and the Economy: the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

Monopoly

Between Competition and Monopoly

Limiting Market Power: Regulation and Antitrust

The Case for Free Markets: the Price System

The Shortcomings of Free Markets

Externalities, the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: the Human Inputs

Poverty, Inequality, and Discrimination

Is Useconomic Leadership Threatened

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

He 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

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