Question 1

-In the above figure, if the interest rate is negatively related to household expenditures for any given level of household income, an increase in the interest rate will

Accepted Answer

A)  shift the line vertically upward. 
B)  shift the line vertically downward. 
C)  make the line negatively sloped. 
D)  cause no change in the line's position. 
A)  shift the line vertically upward. 
B)  shift the line vertically downward. 
C)  make the line negatively sloped. 
D)  cause no change in the line's position.

Question 2

When Al makes the statement, "The cost of living has increased 10 percent over the past 10 years," he is

Accepted Answer

A)  making a normative statement. 
B)  making a positive statement. 
C)  testing an economic model. 
D)  facing the standard of living tradeoff. 
A)  making a normative statement. 
B)  making a positive statement. 
C)  testing an economic model. 
D)  facing the standard of living tradeoff.

Question 3

Which of the following is a normative statement?

Accepted Answer

A)  The unemployment rate is too high. 
B)  Forty percent of the public believes that the unemployment rate is too high. 
C)  The unemployment rate rose last month. 
D)  None of the above are normative statements. 
A)  The unemployment rate is too high. 
B)  Forty percent of the public believes that the unemployment rate is too high. 
C)  The unemployment rate rose last month. 
D)  None of the above are normative statements.

Question 4

Explain whether the statement, "There is life on Mars," is a normative or positive statement.

Accepted Answer

The statement is a positive statement be

Question 5

-Using the data in the above table, if income is on the x-axis and the amount spent on restaurant meals is on the y-axis, the slope of the straight line graph equals

Accepted Answer

A)  0.2. 
B)  0.4. 
C)  0.5. 
D)  2.5. 
A)  0.2. 
B)  0.4. 
C)  0.5. 
D)  2.5.

Question 6

-In the above figure, how does the slope of the line between x = 4 and x = 5 compare with the slope between x = 2 and x = 3?

Accepted Answer

A)  The slope is greater between x = 4 and x = 5. 
B)  The slope is greater between x = 2 and x = 3. 
C)  The slope is the same. 
D)  The slope is not comparable. 
A)  The slope is greater between x = 4 and x = 5. 
B)  The slope is greater between x = 2 and x = 3. 
C)  The slope is the same. 
D)  The slope is not comparable.

Question 7

Suppose Company A's profits increase by $10 million and nobody is made worse off. The CEO of Company A keeps all $10 million for herself. This situation

Accepted Answer

A)  is definitely efficient. 
B)  is definitely not in the self-interest of Company A. 
C)  is definitely not in the social interest. 
D)  is definitely fair. 
A)  is definitely efficient. 
B)  is definitely not in the self-interest of Company A. 
C)  is definitely not in the social interest. 
D)  is definitely fair.

Question 8

-In the above table, the relationship between x and y is ________ and, with y measured on the vertical axis, the slope between y = 5 and y = 8 is equal to ________.

Accepted Answer

A)  negative; 8 
B)  negative; 6 
C)  positive; 5 
D)  positive; 3 
A)  negative; 8 
B)  negative; 6 
C)  positive; 5 
D)  positive; 3

Question 9

What is opportunity cost?

Accepted Answer

Opportunity cost is the highest-valued a

Question 10

The statement "The unemployment rate for teens is higher than that for adults" is

Accepted Answer

A)  a political statement. 
B)  a positive statement. 
C)  a normative statement. 
D)  an ethical statement. 
A)  a political statement. 
B)  a positive statement. 
C)  a normative statement. 
D)  an ethical statement.

Question 11

-The slope of the line shown in the above figure is

Accepted Answer

A)  -1 1/3. 
B)  -1 2/3. 
C)  -1.25. 
D)  -0.80. 
A)  -1 1/3. 
B)  -1 2/3. 
C)  -1.25. 
D)  -0.80.

Question 12

When the government hires people to serve in the army, these people are no longer available to do other work. This choice illustrates the concept of

Accepted Answer

A)  an incentive. 
B)  a social interest/private interest conflict. 
C)  opportunity cost. 
D)  marginal benefit. 
A)  an incentive. 
B)  a social interest/private interest conflict. 
C)  opportunity cost. 
D)  marginal benefit.

Question 13

Which of the following is NOT a normative statement?

Accepted Answer

A)  People buy more of a good or service when its price falls. 
B)  The distribution of income is fair. 
C)  The government ought to provide health care to everyone. 
D)  Corporations should be more socially responsible. 
A)  People buy more of a good or service when its price falls. 
B)  The distribution of income is fair. 
C)  The government ought to provide health care to everyone. 
D)  Corporations should be more socially responsible.

Question 14

Why do economists say that even very rich people face scarcity?

Accepted Answer

A person faces scarcity whenever his or

Question 15

The marginal benefit is the

Accepted Answer

A)  additional gain from one more unit of an activity. 
B)  additional cost from one more unit of an activity. 
C)  loss of the highest-valued alternative. 
D)  additional gain from one more unit of an activity minus the additional cost from one more unit of the activity. 
A)  additional gain from one more unit of an activity. 
B)  additional cost from one more unit of an activity. 
C)  loss of the highest-valued alternative. 
D)  additional gain from one more unit of an activity minus the additional cost from one more unit of the activity.

Question 16

Suppose we are considering the relationship between two variables y and x. y is measured on the y-axis and x is measured on the x-axis, and the relationship between then is a straight line. Suppose that the slope of the line is equal to 1. This slope means that

Accepted Answer

A)  a change in x is associated with a bigger change in y. 
B)  a change in x is associated with a smaller change in y. 
C)  a change in x is associated with no change in y. 
D)  a change in x is associated with an equal change in y. 
A)  a change in x is associated with a bigger change in y. 
B)  a change in x is associated with a smaller change in y. 
C)  a change in x is associated with no change in y. 
D)  a change in x is associated with an equal change in y.

Question 17

Factors of production include all of the following EXCEPT ________.

Accepted Answer

A)  machines made in past years. 
B)  money 
C)  entrepreneurship 
D)  a wheat field that is not irrigated 
A)  machines made in past years. 
B)  money 
C)  entrepreneurship 
D)  a wheat field that is not irrigated

Question 18

-In the above figure, using the slope across an arc, the slope of the curve between points a and c is

Accepted Answer

A)  -3/5. 
B)  3/5. 
C)  5/3. 
D)  -5/3. 
A)  -3/5. 
B)  3/5. 
C)  5/3. 
D)  -5/3.

Question 19

A normative statement is

Accepted Answer

A)  about what ought to be. 
B)  about what is. 
C)  always true. 
D)  one that does not use marginal concepts. 
A)  about what ought to be. 
B)  about what is. 
C)  always true. 
D)  one that does not use marginal concepts.

Question 20

If there is an inverse relationship between variable x and variable y, then an increase in the value of variable x will be accompanied by

Accepted Answer

A)  an increase in the value of variable y. 
B)  a decrease in the value of variable y. 
C)  no change in the value of variable y. 
D)  variable y reaching its maximum value. 
A)  an increase in the value of variable y. 
B)  a decrease in the value of variable y. 
C)  no change in the value of variable y. 
D)  variable y reaching its maximum value.

-In the above figure, if the interest rate is negatively related to household expenditures for any given level of household income, an increase in the interest rate will

When Al makes the statement, "The cost of living has increased 10 percent over the past 10 years," he is

Which of the following is a normative statement?

Explain whether the statement, "There is life on Mars," is a normative or positive statement.

-Using the data in the above table, if income is on the x-axis and the amount spent on restaurant meals is on the y-axis, the slope of the straight line graph equals

-In the above figure, how does the slope of the line between x = 4 and x = 5 compare with the slope between x = 2 and x = 3?

Suppose Company A's profits increase by $10 million and nobody is made worse off. The CEO of Company A keeps all $10 million for herself. This situation

-In the above table, the relationship between x and y is and, with y measured on the vertical axis, the slope between y = 5 and y = 8 is equal to .

What is opportunity cost?

The statement "The unemployment rate for teens is higher than that for adults" is

-The slope of the line shown in the above figure is

When the government hires people to serve in the army, these people are no longer available to do other work. This choice illustrates the concept of

Which of the following is NOT a normative statement?

Why do economists say that even very rich people face scarcity?

The marginal benefit is the

Suppose we are considering the relationship between two variables y and x. y is measured on the y-axis and x is measured on the x-axis, and the relationship between then is a straight line. Suppose that the slope of the line is equal to 1. This slope means that

Factors of production include all of the following EXCEPT ________.

-In the above figure, using the slope across an arc, the slope of the curve between points a and c is

A normative statement is

If there is an inverse relationship between variable x and variable y, then an increase in the value of variable x will be accompanied by

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 1: What Is Economics

-In the above figure, if the interest rate is negatively related to household expenditures for any given level of household income, an increase in the interest rate will

When Al makes the statement, "The cost of living has increased 10 percent over the past 10 years," he is

Which of the following is a normative statement?

Explain whether the statement, "There is life on Mars," is a normative or positive statement.

-Using the data in the above table, if income is on the x-axis and the amount spent on restaurant meals is on the y-axis, the slope of the straight line graph equals

-In the above figure, how does the slope of the line between x = 4 and x = 5 compare with the slope between x = 2 and x = 3?

Suppose Company A's profits increase by $10 million and nobody is made worse off. The CEO of Company A keeps all $10 million for herself. This situation

-In the above table, the relationship between x and y is ________ and, with y measured on the vertical axis, the slope between y = 5 and y = 8 is equal to ________.

What is opportunity cost?

The statement "The unemployment rate for teens is higher than that for adults" is

-The slope of the line shown in the above figure is

When the government hires people to serve in the army, these people are no longer available to do other work. This choice illustrates the concept of

Which of the following is NOT a normative statement?

Why do economists say that even very rich people face scarcity?

The marginal benefit is the

Suppose we are considering the relationship between two variables y and x. y is measured on the y-axis and x is measured on the x-axis, and the relationship between then is a straight line. Suppose that the slope of the line is equal to 1. This slope means that

Factors of production include all of the following EXCEPT ________.

-In the above figure, using the slope across an arc, the slope of the curve between points a and c is

A normative statement is

If there is an inverse relationship between variable x and variable y, then an increase in the value of variable x will be accompanied by

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

-In the above table, the relationship between x and y is and, with y measured on the vertical axis, the slope between y = 5 and y = 8 is equal to .