Question 1

How does a tradeoff exist between a clean environment and a higher level of income?

Accepted Answer

A) Studies show that individuals with higher levels of income actually pollute less than low-income individuals. 
B) To pay for pollution clean-up, the government must increase taxes which lowers income. 
C) Laws that reduce pollution raise costs of production and reduce incomes. 
D) By employing individuals to clean up pollution, employment and income both rise. 
A) Studies show that individuals with higher levels of income actually pollute less than low-income individuals. 
B) To pay for pollution clean-up, the government must increase taxes which lowers income. 
C) Laws that reduce pollution raise costs of production and reduce incomes. 
D) By employing individuals to clean up pollution, employment and income both rise.

Question 2

What is the definition of productivity?

Accepted Answer

A) amount of goods and services produced from each hour of a worker's time 
B) amount of labour that can be saved by replacing workers with machines. 
C) actual amount of effort workers put into an hour of working time 
D) estimated amount of effort workers put into an hour of working time 
A) amount of goods and services produced from each hour of a worker's time 
B) amount of labour that can be saved by replacing workers with machines. 
C) actual amount of effort workers put into an hour of working time 
D) estimated amount of effort workers put into an hour of working time

Question 3

What could justify higher income tax rates on rich people in Canada?

Accepted Answer

A) on the basis of market efficiency 
B) on the basis of the lack of other sources of government revenue 
C) on the basis of equity for society 
D) on the basis of government bias against the wealthy 
A) on the basis of market efficiency 
B) on the basis of the lack of other sources of government revenue 
C) on the basis of equity for society 
D) on the basis of government bias against the wealthy

Question 4

Which of the following is the best example of a marginal change?

Accepted Answer

A) After graduating from university, Neville's income increases from $1,000 per month to $1,100 per month. 
B) Marliss is granted a raise at her part-time job and is now paid $8.25 per hour instead of $8.00. 
C) Housing prices in an area increase by 50% when a new freeway is built in a small town. 
D) A hard freeze wipes out half of the potato crop in Prince Edward Island and the price of potatoes doubles. 
A) After graduating from university, Neville's income increases from $1,000 per month to $1,100 per month. 
B) Marliss is granted a raise at her part-time job and is now paid $8.25 per hour instead of $8.00. 
C) Housing prices in an area increase by 50% when a new freeway is built in a small town. 
D) A hard freeze wipes out half of the potato crop in Prince Edward Island and the price of potatoes doubles.

Question 5

Government spending is the ultimate source of inflation.

Accepted Answer

A) True 
 B)False

Question 6

Carol has spent $2,000 purchasing and repairing an old car, which she expects to sell for $2,400 once the repairs are complete. She discovers that she needs an additional repair, which will cost $400, in order to complete the repairs. She can sell the car as it is now for $2,000. What should she do?

Accepted Answer

A) She should cut her losses and take the $2,400. 
B) She should never sell something for less than it cost. 
C) She should complete the repairs and sell the car. 
D) It doesn't matter which action she takes; the outcome is the same either way. 
A) She should cut her losses and take the $2,400. 
B) She should never sell something for less than it cost. 
C) She should complete the repairs and sell the car. 
D) It doesn't matter which action she takes; the outcome is the same either way.

Question 7

Which best represents the concept represented by the adage, "There is no such thing as a free lunch"?

Accepted Answer

A) Melissa can only attend the concert if she takes her sister with her. 
B) Greg is hungry and homeless. 
C) Brian must repair the tire on his bike before he can ride it to class. 
D) Kendra must decide between going to Miami or Cancun for spring break. 
A) Melissa can only attend the concert if she takes her sister with her. 
B) Greg is hungry and homeless. 
C) Brian must repair the tire on his bike before he can ride it to class. 
D) Kendra must decide between going to Miami or Cancun for spring break.

Question 8

How does a market economy reward people?

Accepted Answer

A) according to their need for goods and services 
B) according to how willing they are to work 
C) according to their ability to produce things that other people are willing to pay for 
D) according to their ability to produce things of cultural importance 
A) according to their need for goods and services 
B) according to how willing they are to work 
C) according to their ability to produce things that other people are willing to pay for 
D) according to their ability to produce things of cultural importance

Question 9

Trade with any nation can be mutually beneficial.

Accepted Answer

A) True 
 B)False

Question 10

If the average cost of transporting a passenger on the train from Brockville to Toronto is $75, it would be irrational for the railroad to allow any passenger to ride for less than $75.

Accepted Answer

A) True 
 B)False

Question 11

If the average income of an Australian is higher than the average income of a Russian, what is the most likely reason?

Accepted Answer

A) Productivity is higher in Australia than in Russia. 
B) Australia has a more industrial economy than Russia. 
C) There is more competition in Australia than in Russia. 
D) Labour unions are more aggressive in Australia than in Russia. 
A) Productivity is higher in Australia than in Russia. 
B) Australia has a more industrial economy than Russia. 
C) There is more competition in Australia than in Russia. 
D) Labour unions are more aggressive in Australia than in Russia.

Question 12

What is the business cycle?

Accepted Answer

A) the relationship between unemployment and inflation 
B) the irregular fluctuations in economic activity 
C) the positive relationship between the quantity of money in an economy and inflation 
D) the predictable changes in economic activity due to changes in government spending and taxes 
A) the relationship between unemployment and inflation 
B) the irregular fluctuations in economic activity 
C) the positive relationship between the quantity of money in an economy and inflation 
D) the predictable changes in economic activity due to changes in government spending and taxes

Question 13

Tim has spent $2,500 purchasing and repairing a Hummer, which he expects to sell for $3,500 once the repairs are complete. He discovers that he needs an additional repair, which will cost $1,100, in order to complete the repairs. He can sell the Hummer as it is now for $900. What should he do?

Accepted Answer

A) He should cut his losses and take the $900. 
B) He should never sell something for less than it cost. 
C) He should complete the repairs and sell the Hummer. 
D) It doesn't matter which action he takes; the outcome is the same either way. 
A) He should cut his losses and take the $900. 
B) He should never sell something for less than it cost. 
C) He should complete the repairs and sell the Hummer. 
D) It doesn't matter which action he takes; the outcome is the same either way.

Question 14

During the 1990s, the United Kingdom experienced low levels of inflation while Turkey experienced high levels of inflation. What best explains the difference?

Accepted Answer

A) The United Kingdom is more industrialized than Turkey. 
B) The United Kingdom printed money at a slower rate than Turkey. 
C) Workers in the United Kingdom are more productive than workers in Turkey. 
D) There were more cases of market failure in Turkey than in the United Kingdom. 
A) The United Kingdom is more industrialized than Turkey. 
B) The United Kingdom printed money at a slower rate than Turkey. 
C) Workers in the United Kingdom are more productive than workers in Turkey. 
D) There were more cases of market failure in Turkey than in the United Kingdom.

Question 15

Tuition is the single-largest cost of attending college for most students.

Accepted Answer

A) True 
 B)False

Question 16

How can trade benefit a family?

Accepted Answer

A) by allowing the family to buy a greater variety of goods and services at a lower cost 
B) by allowing each person to buy only the goods and services they want most 
C) it can benefit only if the family is not in economic competition with other families 
D) trade can only benefit entire nations, not individuals 
A) by allowing the family to buy a greater variety of goods and services at a lower cost 
B) by allowing each person to buy only the goods and services they want most 
C) it can benefit only if the family is not in economic competition with other families 
D) trade can only benefit entire nations, not individuals

Question 17

To increase living standards, what should public policy do?

Accepted Answer

A) ensure that workers are well educated and have the necessary tools and technology 
B) make unemployment benefits more liberal 
C) move workers into jobs directly from high school 
D) ensure that workers have access to union membership and benefits 
A) ensure that workers are well educated and have the necessary tools and technology 
B) make unemployment benefits more liberal 
C) move workers into jobs directly from high school 
D) ensure that workers have access to union membership and benefits

Question 18

A marginal change is illustrated by which of the following?

Accepted Answer

A) Nancy retires and takes a part-time job. She was working 40 hours per week and now works 10 hours per week. 
B) Provincial University has announced that due to provincial budget deficits, tuition must rise by 25% next year. 
C) Ryan moved to a new apartment and now pays 40% more rent than before. 
D) Vancouver, which usually receives 10 inches of rain per year, received 11 inches last year. 
A) Nancy retires and takes a part-time job. She was working 40 hours per week and now works 10 hours per week. 
B) Provincial University has announced that due to provincial budget deficits, tuition must rise by 25% next year. 
C) Ryan moved to a new apartment and now pays 40% more rent than before. 
D) Vancouver, which usually receives 10 inches of rain per year, received 11 inches last year.

Question 19

What is an example of a firm with market power?

Accepted Answer

A) a deli in Winnipeg 
B) a cable TV provider in Victoria 
C) a clothing store in Vancouver 
D) a farmer in Quebec 
A) a deli in Winnipeg 
B) a cable TV provider in Victoria 
C) a clothing store in Vancouver 
D) a farmer in Quebec

Question 20

What does the Phillips curve help explain?

Accepted Answer

A) the business cycle 
B) supply and demand 
C) government spending 
D) money supply changes 
A) the business cycle 
B) supply and demand 
C) government spending 
D) money supply changes

How does a tradeoff exist between a clean environment and a higher level of income?

What is the definition of productivity?

What could justify higher income tax rates on rich people in Canada?

Which of the following is the best example of a marginal change?

Government spending is the ultimate source of inflation.

Carol has spent $2,000 purchasing and repairing an old car, which she expects to sell for $2,400 once the repairs are complete. She discovers that she needs an additional repair, which will cost $400, in order to complete the repairs. She can sell the car as it is now for $2,000. What should she do?

Which best represents the concept represented by the adage, "There is no such thing as a free lunch"?

How does a market economy reward people?

Trade with any nation can be mutually beneficial.

If the average cost of transporting a passenger on the train from Brockville to Toronto is $75, it would be irrational for the railroad to allow any passenger to ride for less than $75.

If the average income of an Australian is higher than the average income of a Russian, what is the most likely reason?

What is the business cycle?

Tim has spent $2,500 purchasing and repairing a Hummer, which he expects to sell for $3,500 once the repairs are complete. He discovers that he needs an additional repair, which will cost $1,100, in order to complete the repairs. He can sell the Hummer as it is now for $900. What should he do?

During the 1990s, the United Kingdom experienced low levels of inflation while Turkey experienced high levels of inflation. What best explains the difference?

Tuition is the single-largest cost of attending college for most students.

How can trade benefit a family?

To increase living standards, what should public policy do?

A marginal change is illustrated by which of the following?

What is an example of a firm with market power?

What does the Phillips curve help explain?

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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Exam 1: Ten Principles of Economics

How does a tradeoff exist between a clean environment and a higher level of income?

What is the definition of productivity?

What could justify higher income tax rates on rich people in Canada?

Which of the following is the best example of a marginal change?

Government spending is the ultimate source of inflation.

Which best represents the concept represented by the adage, "There is no such thing as a free lunch"?

How does a market economy reward people?

Trade with any nation can be mutually beneficial.

If the average cost of transporting a passenger on the train from Brockville to Toronto is $75, it would be irrational for the railroad to allow any passenger to ride for less than $75.

If the average income of an Australian is higher than the average income of a Russian, what is the most likely reason?

What is the business cycle?

Tim has spent $2,500 purchasing and repairing a Hummer, which he expects to sell for $3,500 once the repairs are complete. He discovers that he needs an additional repair, which will cost $1,100, in order to complete the repairs. He can sell the Hummer as it is now for $900. What should he do?

During the 1990s, the United Kingdom experienced low levels of inflation while Turkey experienced high levels of inflation. What best explains the difference?

Tuition is the single-largest cost of attending college for most students.

How can trade benefit a family?

To increase living standards, what should public policy do?

A marginal change is illustrated by which of the following?

What is an example of a firm with market power?

What does the Phillips curve help explain?

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

Filters