Question 1

-In the above figure, the slope across the arc between b and c is

Accepted Answer

A)  1/2. 
B)  2/3. 
C)  1. 
D)  2. 
A)  1/2. 
B)  2/3. 
C)  1. 
D)  2.

Question 2

Using the above figure, the origin is at which point?

Accepted Answer

A)  point a 
B)  point b 
C)  point c 
D)  None of the points in the figure is the origin. 
A)  point a 
B)  point b 
C)  point c 
D)  None of the points in the figure is the origin.

Question 3

The fact that people with higher incomes get to consume more goods and services addresses the ________ part of one of the two big economic questions.

Accepted Answer

A)  "for whom" 
B)  "when" 
C)  "where" 
D)  "how" 
A)  "for whom" 
B)  "when" 
C)  "where" 
D)  "how"

Question 4

Whenever one variable increases, another variable decreases. The two variables are

Accepted Answer

A)  definitely related through a third variable. 
B)  negatively related. 
C)  positively related. 
D)  unrelated to each other. 
A)  definitely related through a third variable. 
B)  negatively related. 
C)  positively related. 
D)  unrelated to each other.

Question 5

An inducement to take a particular action is called

Accepted Answer

A)  the marginal benefit. 
B)  the marginal cost. 
C)  opportunity cost. 
D)  an incentive. 
A)  the marginal benefit. 
B)  the marginal cost. 
C)  opportunity cost. 
D)  an incentive.

Question 6

Jane is deciding whether to go to school for 8 weeks this summer. The cost of tuition and textbooks is $1,700 and housing and other expenses will cost her $600. If she does not go to school, she will live in her parents' house for free and they will cover her food and other expenses for her. Also, if Jane does not go to summer school she could work fulltime. But the best job she can get pays only $600 per week, and Jane would only agree to give up her free time for no less than $750 per week. However, if she goes to summer school, she'll have to spend 40 hours a week attending classes and studying.
a) What will the summer school cost Jane in terms of money spent?
b) What are the opportunity costs of going to summer school that Jane does not pay explicitly? Explain.
c) What is Jane's total opportunity cost of going to school this summer? Explain your answer.
d) Suppose that if Jane does not go to summer school, she will eventually take the classes anyway. What is Jane's marginal benefit of going to summer school?
e) Suppose Jane decides to go to school in the summer. Explain her decision using the concepts of marginal cost and marginal benefit.

Accepted Answer

a) Jane explicitly pays the cost of tuit

Question 7

To calculate the slope of a curved line, you can calculate the slope at a point on the curve or across an arc of the curve.

Accepted Answer

A) True 
 B)False

Question 8

Explain what entrepreneurship is and why it is considered a factor of production.

Accepted Answer

Entrepreneurship is the resource (the pe

Question 9

If Taco Bell decides to produce more tacos and fewer burritos, Taco Bell is answering the ________ part of one of the two big economic questions.

Accepted Answer

A)  "what" 
B)  "why" 
C)  "when" 
D)  "scarcity" 
A)  "what" 
B)  "why" 
C)  "when" 
D)  "scarcity"

Question 10

When a farmer decides to raise hogs instead of cattle, the farmer is answering the ________ part of one of the two big economic questions.

Accepted Answer

A)  "what" 
B)  "for whom" 
C)  "how" 
D)  "why" 
A)  "what" 
B)  "for whom" 
C)  "how" 
D)  "why"

Question 11

Which of the following is a positive statement?

Accepted Answer

A)  The United States should fight inflation even if it raises unemployment. 
B)  What to do with Social Security is the most important economic issue today. 
C)  A 5 percent increase in income leads to a 3 percent increase in the consumption of orange juice. 
D)  Because they decrease productivity, labor unions should be eliminated. 
A)  The United States should fight inflation even if it raises unemployment. 
B)  What to do with Social Security is the most important economic issue today. 
C)  A 5 percent increase in income leads to a 3 percent increase in the consumption of orange juice. 
D)  Because they decrease productivity, labor unions should be eliminated.

Question 12

A graph shows that as fees to use ATM machines increase, people use them less frequently. The graph of this relationship would show

Accepted Answer

A)  an inverse relationship. 
B)  a negative relationship. 
C)  a direct relationship. 
D)  Both answers A and B are correct. 
A)  an inverse relationship. 
B)  a negative relationship. 
C)  a direct relationship. 
D)  Both answers A and B are correct.

Question 13

Which of the following is an example of a microeconomic decision?

Accepted Answer

A)  an individual deciding how to allocate the time he or she has for work and leisure 
B)  a small shoe factory deciding how much leather to purchase for the next quarter's production need 
C)  a multinational company deciding where to relocate its world headquarter 
D)  All of the above answers are correct. 
A)  an individual deciding how to allocate the time he or she has for work and leisure 
B)  a small shoe factory deciding how much leather to purchase for the next quarter's production need 
C)  a multinational company deciding where to relocate its world headquarter 
D)  All of the above answers are correct.

Question 14

-On a graph, an upward-sloping curve that is flatter as you move away from the origin indicates a

Accepted Answer

A)  positive relationship with an increasing slope. 
B)  positive relationship with a decreasing slope. 
C)  negative relationship with an increasing slope. 
D)  negative relationship with a decreasing slope. 
A)  positive relationship with an increasing slope. 
B)  positive relationship with a decreasing slope. 
C)  negative relationship with an increasing slope. 
D)  negative relationship with a decreasing slope.

Question 15

-In the above figure, the axis break in the x-axis

Accepted Answer

A)  reflects the fact that for the years covered in the figure, the unemployment rate was never less than 3 percent. 
B)  shows that there is no relationship between inflation and unemployment. 
C)  misleadingly shows that inflation has changed very little even though the unemployment rate has increased a great deal. 
D)  implies that for the years covered in the figure, the inflation rate was always greater than 1 percent. 
A)  reflects the fact that for the years covered in the figure, the unemployment rate was never less than 3 percent. 
B)  shows that there is no relationship between inflation and unemployment. 
C)  misleadingly shows that inflation has changed very little even though the unemployment rate has increased a great deal. 
D)  implies that for the years covered in the figure, the inflation rate was always greater than 1 percent.

Question 16

The 2010 Patient Protection and Affordable Care Act (Obamacare) contains a provision that may require individuals to either purchase private health insurance or pay a tax. This is an example of

Accepted Answer

A)  a mixed economy. 
B)  market capitalism. 
C)  centrally planned socialism. 
D)  the invisible hand. 
A)  a mixed economy. 
B)  market capitalism. 
C)  centrally planned socialism. 
D)  the invisible hand.

Question 17

Factors of production are grouped into four categories

Accepted Answer

A)  land, labor, capital, entrepreneurship. 
B)  land, labor, capital, money. 
C)  land, capital, money, entrepreneurship. 
D)  labor, capital, money, entrepreneurship. 
A)  land, labor, capital, entrepreneurship. 
B)  land, labor, capital, money. 
C)  land, capital, money, entrepreneurship. 
D)  labor, capital, money, entrepreneurship.

Question 18

Microeconomics is the study of topics such as national production and unemployment.

Accepted Answer

A) True 
 B)False

Question 19

Positive economic statements

Accepted Answer

A)  prescribe what should be. 
B)  are related only to microeconomics. 
C)  can be tested against the facts. 
D)  cannot be tested against the facts. 
A)  prescribe what should be. 
B)  are related only to microeconomics. 
C)  can be tested against the facts. 
D)  cannot be tested against the facts.

Question 20

Suppose that the government of New York state promises to decrease taxes to a firm if it decides to stay in New York instead of moving to another state. This policy on the part of the state constitutes ________, to make the ________ of the firm remaining in New York.

Accepted Answer

A)  an incentive; marginal benefit exceed the marginal cost 
B)  an incentive; marginal cost exceed the marginal benefit 
C)  a command; marginal benefit exceed the marginal cost 
D)  a command; marginal cost exceed the marginal benefit 
A)  an incentive; marginal benefit exceed the marginal cost 
B)  an incentive; marginal cost exceed the marginal benefit 
C)  a command; marginal benefit exceed the marginal cost 
D)  a command; marginal cost exceed the marginal benefit

-In the above figure, the slope across the arc between b and c is

Using the above figure, the origin is at which point?

The fact that people with higher incomes get to consume more goods and services addresses the ________ part of one of the two big economic questions.

Whenever one variable increases, another variable decreases. The two variables are

An inducement to take a particular action is called

To calculate the slope of a curved line, you can calculate the slope at a point on the curve or across an arc of the curve.

Explain what entrepreneurship is and why it is considered a factor of production.

If Taco Bell decides to produce more tacos and fewer burritos, Taco Bell is answering the ________ part of one of the two big economic questions.

When a farmer decides to raise hogs instead of cattle, the farmer is answering the ________ part of one of the two big economic questions.

Which of the following is a positive statement?

A graph shows that as fees to use ATM machines increase, people use them less frequently. The graph of this relationship would show

Which of the following is an example of a microeconomic decision?

-On a graph, an upward-sloping curve that is flatter as you move away from the origin indicates a

-In the above figure, the axis break in the x-axis

The 2010 Patient Protection and Affordable Care Act (Obamacare) contains a provision that may require individuals to either purchase private health insurance or pay a tax. This is an example of

Factors of production are grouped into four categories

Microeconomics is the study of topics such as national production and unemployment.

Positive economic statements

Suppose that the government of New York state promises to decrease taxes to a firm if it decides to stay in New York instead of moving to another state. This policy on the part of the state constitutes , to make the of the firm remaining in New York.

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, the slope across the arc between b and c is

Using the above figure, the origin is at which point?

The fact that people with higher incomes get to consume more goods and services addresses the ________ part of one of the two big economic questions.

Whenever one variable increases, another variable decreases. The two variables are

An inducement to take a particular action is called

To calculate the slope of a curved line, you can calculate the slope at a point on the curve or across an arc of the curve.

Explain what entrepreneurship is and why it is considered a factor of production.

If Taco Bell decides to produce more tacos and fewer burritos, Taco Bell is answering the ________ part of one of the two big economic questions.

When a farmer decides to raise hogs instead of cattle, the farmer is answering the ________ part of one of the two big economic questions.

Which of the following is a positive statement?

A graph shows that as fees to use ATM machines increase, people use them less frequently. The graph of this relationship would show

Which of the following is an example of a microeconomic decision?

-On a graph, an upward-sloping curve that is flatter as you move away from the origin indicates a

-In the above figure, the axis break in the x-axis

The 2010 Patient Protection and Affordable Care Act (Obamacare) contains a provision that may require individuals to either purchase private health insurance or pay a tax. This is an example of

Factors of production are grouped into four categories

Microeconomics is the study of topics such as national production and unemployment.

Positive economic statements

Suppose that the government of New York state promises to decrease taxes to a firm if it decides to stay in New York instead of moving to another state. This policy on the part of the state constitutes ________, to make the ________ of the firm remaining in New York.

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

Suppose that the government of New York state promises to decrease taxes to a firm if it decides to stay in New York instead of moving to another state. This policy on the part of the state constitutes , to make the of the firm remaining in New York.