Question 1

Microeconomics can be used by governments to predict the impacts of a policy and suggest solutions to problems.

Accepted Answer

A) True 
 B)False

Question 2

Most microeconomic models assume that decision makers wish to

Accepted Answer

A) make themselves as well off as possible. 
B) act selfishly. 
C) make others as well off as possible. 
D) None of the above. 
A) make themselves as well off as possible. 
B) act selfishly. 
C) make others as well off as possible. 
D) None of the above.

Question 3

"If fines for speeding when driving increase,fewer accidents will occur" is an example of a(n)

Accepted Answer

A) positive statement. 
B) normative statement. 
C) negative statement. 
D) inverse statement. 
A) positive statement. 
B) normative statement. 
C) negative statement. 
D) inverse statement.

Question 4

If a model's predictions are correct,then

Accepted Answer

A) its assumptions must have been correct. 
B) it is proven to be correct. 
C) Both A and B above. 
D) None of the above. 
A) its assumptions must have been correct. 
B) it is proven to be correct. 
C) Both A and B above. 
D) None of the above.

Question 5

In year 2008,1334 million lbs of milk was produced and sold in U.S.This is

Accepted Answer

A) the decision of the U.S.department of agriculture. 
B) quantity determined by the interactions in the market. 
C) the maximum amount the producers could produce. 
D) what consumers needed. 
A) the decision of the U.S.department of agriculture. 
B) quantity determined by the interactions in the market. 
C) the maximum amount the producers could produce. 
D) what consumers needed.

Question 6

Which of the following is an example of a normative statement?

Accepted Answer

A) A higher price for a good causes people to want to buy less of that good. 
B) A lower price for a good causes people to want to buy more of that good. 
C) To make the good available to more people,a lower price should be set. 
D) If you consume this good,you will be better off. 
A) A higher price for a good causes people to want to buy less of that good. 
B) A lower price for a good causes people to want to buy more of that good. 
C) To make the good available to more people,a lower price should be set. 
D) If you consume this good,you will be better off.

Question 7

Economic policy of the government is often based on

Accepted Answer

A) microeconomic models. 
B) educated guessing. 
C) intuitive reasoning. 
D) hints. 
A) microeconomic models. 
B) educated guessing. 
C) intuitive reasoning. 
D) hints.

Question 8

Who or what is responsible for the allocation of scarce resources into the production of most goods in the U.S.?

Accepted Answer

A) the American government 
B) the UN 
C) the Federal Reserve Bank 
D) markets and prices 
A) the American government 
B) the UN 
C) the Federal Reserve Bank 
D) markets and prices

Question 9

Which of the following statements is a normative statement?

Accepted Answer

A) Minimum wage reduces employment. 
B) Minimum wages causes surplus in labor market. 
C) Minimum wage will improve the living of junior works more than senior workers. 
D) Minimum wage should be welcomed by the low income class. 
A) Minimum wage reduces employment. 
B) Minimum wages causes surplus in labor market. 
C) Minimum wage will improve the living of junior works more than senior workers. 
D) Minimum wage should be welcomed by the low income class.

Question 10

The flu vaccination example in Section 1.1 of the textbook is an example of how policy makers may cope with

Accepted Answer

A) scarcity of medical treatment. 
B) scarcity of patients. 
C) scarcity of policy makers. 
D) answering the question of how to produce. 
A) scarcity of medical treatment. 
B) scarcity of patients. 
C) scarcity of policy makers. 
D) answering the question of how to produce.

Question 11

A market

Accepted Answer

A) always involves the personal exchange of goods for money. 
B) allows interactions between consumers and firms. 
C) always takes place at a physical location. 
D) has no influence on prices. 
A) always involves the personal exchange of goods for money. 
B) allows interactions between consumers and firms. 
C) always takes place at a physical location. 
D) has no influence on prices.

Question 12

A theory stating that individuals make purchasing decisions based on tastes which change randomly at random intervals is not useful because

Accepted Answer

A) it is not possible to test the predictions of the model. 
B) tastes are not the only factor influencing behavior. 
C) the model is too simplistic. 
D) the predictions of such a model would be incorrect. 
A) it is not possible to test the predictions of the model. 
B) tastes are not the only factor influencing behavior. 
C) the model is too simplistic. 
D) the predictions of such a model would be incorrect.

Question 13

Einstein was quoted saying "Everything should be made as simple as possible,but not simpler." When it comes to economic models this means that

Accepted Answer

A) models shouldn't be too complex. 
B) models shouldn't be too simple. 
C) models should have a level of abstraction appropriate to the topic investigated. 
D) All of the above. 
A) models shouldn't be too complex. 
B) models shouldn't be too simple. 
C) models should have a level of abstraction appropriate to the topic investigated. 
D) All of the above.

Question 14

Normative analysis offers decision makers the most valuable information when choosing among alternatives.

Accepted Answer

A) True 
 B)False

Question 15

Microeconomics is often called

Accepted Answer

A) price theory. 
B) decision science. 
C) scarcity. 
D) resource theory. 
A) price theory. 
B) decision science. 
C) scarcity. 
D) resource theory.

Question 16

The analysis of the competition between Apple and Samsung in the smartphone market is based on

Accepted Answer

A) microeconomic model. 
B) educated guessing. 
C) intuitive reasoning. 
D) consumer surveys. 
A) microeconomic model. 
B) educated guessing. 
C) intuitive reasoning. 
D) consumer surveys.

Question 17

Income tax on the wealthy to finance the welfare for the poor causes income redistribution.This is an example for the trade-off

Accepted Answer

A) Which goods and services to produce. 
B) How to produce. 
C) Who gets the goods and services. 
D) Who produces the goods and services. 
A) Which goods and services to produce. 
B) How to produce. 
C) Who gets the goods and services. 
D) Who produces the goods and services.

Question 18

An automobile manufacturer is trying to make decisions about using more workers or more equipment.This belongs to the trade-off

Accepted Answer

A) Which goods and services to produce. 
B) How to produce. 
C) Who gets the goods and services. 
D) Who produces the goods and services. 
A) Which goods and services to produce. 
B) How to produce. 
C) Who gets the goods and services. 
D) Who produces the goods and services.

Question 19

What links the decisions of consumers and firms in a market?

Accepted Answer

A) the government 
B) prices 
C) coordination officials 
D) microeconomics 
A) the government 
B) prices 
C) coordination officials 
D) microeconomics

Question 20

Legislators argue that a minimum wage law is instituted to help poor people.Economists can attack the minimum wage law on two fronts.First,some argue that government should not help the poor.Second,some argue that minimum wage laws actually hurt the poor because it creates unemployment.Which argument is normative and which is positive?

Accepted Answer

An opinion about the role of g

Microeconomics can be used by governments to predict the impacts of a policy and suggest solutions to problems.

Most microeconomic models assume that decision makers wish to

"If fines for speeding when driving increase,fewer accidents will occur" is an example of a(n)

If a model's predictions are correct,then

In year 2008,1334 million lbs of milk was produced and sold in U.S.This is

Which of the following is an example of a normative statement?

Economic policy of the government is often based on

Who or what is responsible for the allocation of scarce resources into the production of most goods in the U.S.?

Which of the following statements is a normative statement?

The flu vaccination example in Section 1.1 of the textbook is an example of how policy makers may cope with

A market

A theory stating that individuals make purchasing decisions based on tastes which change randomly at random intervals is not useful because

Einstein was quoted saying "Everything should be made as simple as possible,but not simpler." When it comes to economic models this means that

Normative analysis offers decision makers the most valuable information when choosing among alternatives.

Microeconomics is often called

The analysis of the competition between Apple and Samsung in the smartphone market is based on

Income tax on the wealthy to finance the welfare for the poor causes income redistribution.This is an example for the trade-off

An automobile manufacturer is trying to make decisions about using more workers or more equipment.This belongs to the trade-off

What links the decisions of consumers and firms in a market?

Supply and Demand

A Consumers Constrained Choice

Demand

Consumer Welfare and Policy Analysis

Firms and Production

Costs

Competitive Firms and Markets

Properties and Applications of the Competitive Model

General Equilibrium and Economic Welfare

Monopoly and Monopsony

Pricing and Advertising

Game Theory

Oligopoly and Monopolistic Competition

Factor Markets

Uncertainty

Property Rights, Externalities, Rivalry, and Exclusion

Asymmetric Information

Contracts and Moral Hazards

Filters

Exam 1: Introduction

Microeconomics can be used by governments to predict the impacts of a policy and suggest solutions to problems.

Most microeconomic models assume that decision makers wish to

"If fines for speeding when driving increase,fewer accidents will occur" is an example of a(n)

If a model's predictions are correct,then

In year 2008,1334 million lbs of milk was produced and sold in U.S.This is

Which of the following is an example of a normative statement?

Economic policy of the government is often based on

Who or what is responsible for the allocation of scarce resources into the production of most goods in the U.S.?

Which of the following statements is a normative statement?

The flu vaccination example in Section 1.1 of the textbook is an example of how policy makers may cope with

A market

A theory stating that individuals make purchasing decisions based on tastes which change randomly at random intervals is not useful because

Einstein was quoted saying "Everything should be made as simple as possible,but not simpler." When it comes to economic models this means that

Normative analysis offers decision makers the most valuable information when choosing among alternatives.

Microeconomics is often called

The analysis of the competition between Apple and Samsung in the smartphone market is based on

Income tax on the wealthy to finance the welfare for the poor causes income redistribution.This is an example for the trade-off

An automobile manufacturer is trying to make decisions about using more workers or more equipment.This belongs to the trade-off

What links the decisions of consumers and firms in a market?

Supply and Demand

A Consumers Constrained Choice

Demand

Consumer Welfare and Policy Analysis

Firms and Production

Costs

Competitive Firms and Markets

Properties and Applications of the Competitive Model

General Equilibrium and Economic Welfare

Monopoly and Monopsony

Pricing and Advertising

Game Theory

Oligopoly and Monopolistic Competition

Factor Markets

Uncertainty

Property Rights, Externalities, Rivalry, and Exclusion

Asymmetric Information

Contracts and Moral Hazards

Filters