Question 1

The way that a society uses to allocate resources to satisfy human wants is called

Accepted Answer

A) an economic system. 
B) an assumption. 
C) realism. 
D) a physical science. 
A) an economic system. 
B) an assumption. 
C) realism. 
D) a physical science.

Question 2

A politician says that the government should tax behavior they want less of and subsidize behavior they want more of. This is an example of

Accepted Answer

A) cynical behavior in modern democracies. 
B) failing to consider the alternatives available to the government. 
C) a concern that people are not rational when they make decisions. 
D) using incentives to alter behavior. 
A) cynical behavior in modern democracies. 
B) failing to consider the alternatives available to the government. 
C) a concern that people are not rational when they make decisions. 
D) using incentives to alter behavior.

Question 3

A map is an example of a model because a map

Accepted Answer

A) realistically describes an area. 
B) is always as complex as space will permit. 
C) is two-dimensional. 
D) is a simplified representation of reality. 
A) realistically describes an area. 
B) is always as complex as space will permit. 
C) is two-dimensional. 
D) is a simplified representation of reality.

Question 4

A scientist who is studying earthquakes includes the impact of wind when performing some tests of damages to structures. This is an example of

Accepted Answer

A) failing to understand how to do scientific methodology. 
B) irrational behavior in noneconomic situations. 
C) accounting for every possible phenomena that may effect the problem under examination. 
D) failing to hold all other things constant. 
A) failing to understand how to do scientific methodology. 
B) irrational behavior in noneconomic situations. 
C) accounting for every possible phenomena that may effect the problem under examination. 
D) failing to hold all other things constant.

Question 5

A direct relationship occurs when

Accepted Answer

A) the two variables being compared change in opposite directions, or when one goes up the other goes down. 
B) a change in one of the variables causes a change in the other variable in any direction. 
C) the two variables being compared change in the same direction, or when one goes up the other also goes up. 
D) the two variables have no identifiable relationship with each other. 
A) the two variables being compared change in opposite directions, or when one goes up the other goes down. 
B) a change in one of the variables causes a change in the other variable in any direction. 
C) the two variables being compared change in the same direction, or when one goes up the other also goes up. 
D) the two variables have no identifiable relationship with each other.

Question 6

Jane is currently developing a model to explain the national unemployment rate. This is an example of

Accepted Answer

A) a microeconomic topic. 
B) normative analysis. 
C) positive analysis. 
D) how people act in an irrational manner. 
A) a microeconomic topic. 
B) normative analysis. 
C) positive analysis. 
D) how people act in an irrational manner.

Question 7

Which of the following is a normative economic statement?

Accepted Answer

A) An increase in corporate income taxes will cause the unemployment rate to increase. 
B) The costs of medical care are increasing faster than the incomes of U.S. citizens. 
C) Teenage unemployment is over ten percent. 
D) Teenage unemployment is too high. 
A) An increase in corporate income taxes will cause the unemployment rate to increase. 
B) The costs of medical care are increasing faster than the incomes of U.S. citizens. 
C) Teenage unemployment is over ten percent. 
D) Teenage unemployment is too high.

Question 8

Macroeconomics is concerned with

Accepted Answer

A) individual business firms. 
B) specific industries. 
C) individual consumers. 
D) a nation's entire economy. 
A) individual business firms. 
B) specific industries. 
C) individual consumers. 
D) a nation's entire economy.

Question 9

If two competing models are offered to explain a certain economic phenomenon, the better model is the one

Accepted Answer

A) that is the newest since newer models are better than old models. 
B) with the fewest unrealistic assumptions. 
C) that more often predicts with most accuracy. 
D) that is not subject to empirical verification. 
A) that is the newest since newer models are better than old models. 
B) with the fewest unrealistic assumptions. 
C) that more often predicts with most accuracy. 
D) that is not subject to empirical verification.

Question 10

In economics, ________ are limited but ________ are unlimited.

Accepted Answer

A) wants; resources 
B) resources; wants 
C) money; ideas 
D) ideas; money 
A) wants; resources 
B) resources; wants 
C) money; ideas 
D) ideas; money

Question 11

What does it mean to say economics is an empirical science, and how is this related to the question of deciding on the usefulness of a model?

Accepted Answer

Economists examine evidence to test whet

Question 12

The slope of a line is the

Accepted Answer

A) change in the values along the x-axis divided by the change in the values along the y-axis. 
B) values on the x-axis divided by the values on the y-axis. 
C) change in the values along the y-axis divided by the change in the values along the x-axis. 
D) values on the y-axis divided by the values on the x-axis. 
A) change in the values along the x-axis divided by the change in the values along the y-axis. 
B) values on the x-axis divided by the values on the y-axis. 
C) change in the values along the y-axis divided by the change in the values along the x-axis. 
D) values on the y-axis divided by the values on the x-axis.

Question 13

In building a model the assumption that allows economists to study only the factors being analyzed is the

Accepted Answer

A) rationality assumption. 
B) ceteris paribus assumption. 
C) the self-interest assumption. 
D) the scarcity assumption. 
A) rationality assumption. 
B) ceteris paribus assumption. 
C) the self-interest assumption. 
D) the scarcity assumption.

Question 14

Central planning is a key characteristic of which economic system?

Accepted Answer

A) free market 
B) price system 
C) command and control 
D) mixed economic system 
A) free market 
B) price system 
C) command and control 
D) mixed economic system

Question 15

A possible rational reason why older people, on average, show less interest in learning how to use new technologies is because

Accepted Answer

A) older people are not as smart as (today's)young people. 
B) they are acting irrationally. 
C) they have fewer years to gain a return from learning how to use new technologies. 
D) the financial cost for older people is greater than the cost to younger people. 
A) older people are not as smart as (today's)young people. 
B) they are acting irrationally. 
C) they have fewer years to gain a return from learning how to use new technologies. 
D) the financial cost for older people is greater than the cost to younger people.

Question 16

Which of the following would most likely NOT be taught in a macroeconomics course?

Accepted Answer

A) changes in the health care industry 
B) factors leading to different economic growth rates among countries 
C) government actions in response to a slowdown in the economy 
D) the relationship between the inflation rate and the unemployment rate 
A) changes in the health care industry 
B) factors leading to different economic growth rates among countries 
C) government actions in response to a slowdown in the economy 
D) the relationship between the inflation rate and the unemployment rate

Question 17

All of the following are aspects of macroeconomics EXCEPT

Accepted Answer

A) the U.S. unemployment rate. 
B) the production decisions of a pharmaceutical firm. 
C) the budget deficit of the United States. 
D) foreign trade. 
A) the U.S. unemployment rate. 
B) the production decisions of a pharmaceutical firm. 
C) the budget deficit of the United States. 
D) foreign trade.

Question 18

"Ceteris paribus" assumption means

Accepted Answer

A) the role of rational self-interest in the economy. 
B) that nothing else changes except the variables under consideration. 
C) relying on real-world data in evaluating the usefulness of a model. 
D) analysis that is strictly limited to making either purely descriptive statements or scientific predictions. 
A) the role of rational self-interest in the economy. 
B) that nothing else changes except the variables under consideration. 
C) relying on real-world data in evaluating the usefulness of a model. 
D) analysis that is strictly limited to making either purely descriptive statements or scientific predictions.

Question 19

Which of the following is an example of an inverse relationship?

Accepted Answer

A) hours of study and test grade 
B) calories eliminated from diet and weight loss 
C) beers consumed while studying and test grade 
D) amount of snowfall and profits of ski resorts 
A) hours of study and test grade 
B) calories eliminated from diet and weight loss 
C) beers consumed while studying and test grade 
D) amount of snowfall and profits of ski resorts

Question 20

To be useful, a model must

Accepted Answer

A) predict accurately all of the time. 
B) predict more accurately than other models that have been developed. 
C) have assumptions that have been verified by empirical testing. 
D) explain and predict the behavior of every individual. 
A) predict accurately all of the time. 
B) predict more accurately than other models that have been developed. 
C) have assumptions that have been verified by empirical testing. 
D) explain and predict the behavior of every individual.

The way that a society uses to allocate resources to satisfy human wants is called

A politician says that the government should tax behavior they want less of and subsidize behavior they want more of. This is an example of

A map is an example of a model because a map

A scientist who is studying earthquakes includes the impact of wind when performing some tests of damages to structures. This is an example of

A direct relationship occurs when

Jane is currently developing a model to explain the national unemployment rate. This is an example of

Which of the following is a normative economic statement?

Macroeconomics is concerned with

If two competing models are offered to explain a certain economic phenomenon, the better model is the one

In economics, are limited but are unlimited.

What does it mean to say economics is an empirical science, and how is this related to the question of deciding on the usefulness of a model?

The slope of a line is the

In building a model the assumption that allows economists to study only the factors being analyzed is the

Central planning is a key characteristic of which economic system?

A possible rational reason why older people, on average, show less interest in learning how to use new technologies is because

Which of the following would most likely NOT be taught in a macroeconomics course?

All of the following are aspects of macroeconomics EXCEPT

"Ceteris paribus" assumption means

Which of the following is an example of an inverse relationship?

To be useful, a model must

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money Banking and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters

Exam 1: The Nature of Economics

The way that a society uses to allocate resources to satisfy human wants is called

A politician says that the government should tax behavior they want less of and subsidize behavior they want more of. This is an example of

A map is an example of a model because a map

A scientist who is studying earthquakes includes the impact of wind when performing some tests of damages to structures. This is an example of

A direct relationship occurs when

Jane is currently developing a model to explain the national unemployment rate. This is an example of

Which of the following is a normative economic statement?

Macroeconomics is concerned with

If two competing models are offered to explain a certain economic phenomenon, the better model is the one

In economics, ________ are limited but ________ are unlimited.

What does it mean to say economics is an empirical science, and how is this related to the question of deciding on the usefulness of a model?

The slope of a line is the

In building a model the assumption that allows economists to study only the factors being analyzed is the

Central planning is a key characteristic of which economic system?

A possible rational reason why older people, on average, show less interest in learning how to use new technologies is because

Which of the following would most likely NOT be taught in a macroeconomics course?

All of the following are aspects of macroeconomics EXCEPT

"Ceteris paribus" assumption means

Which of the following is an example of an inverse relationship?

To be useful, a model must

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money Banking and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters

In economics, are limited but are unlimited.