Question 1

"Smokers are more likely to be murdered than nonsmokers." This statement is an example of:

Accepted Answer

A)  the fallacy of unintended consequences. 
B)  a positive economic statement. 
C)  a normative economic statement. 
D)  a value judgment. 
A)  the fallacy of unintended consequences. 
B)  a positive economic statement. 
C)  a normative economic statement. 
D)  a value judgment.

Question 2

An example of a normative statement is:

Accepted Answer

A)  The rate of unemployment is 4 percent. 
B)  A high rate of economic growth is good for the country. 
C)  The federal government spends half of its budget on national defense. 
D)  People with health insurance tend to spend more on health care than those who are uninsured. 
A)  The rate of unemployment is 4 percent. 
B)  A high rate of economic growth is good for the country. 
C)  The federal government spends half of its budget on national defense. 
D)  People with health insurance tend to spend more on health care than those who are uninsured.

Question 3

A key theme fundamental to all of economics is:

Accepted Answer

A)  there are limited wants. 
B)  we are a rich country but are simply not aware of it. 
C)  people have unlimited wants facing limited means to satisfy them. 
D)  there are unlimited resources. 
A)  there are limited wants. 
B)  we are a rich country but are simply not aware of it. 
C)  people have unlimited wants facing limited means to satisfy them. 
D)  there are unlimited resources.

Question 4

`Briefly define scarcity, choice, and opportunity cost and explain carefully how they are related and why they are so essential in the study of economics.

Accepted Answer

Scarcity refers to the limited availabil

Question 5

When we are forced to make choices we are facing the concept of:

Accepted Answer

A)  ceteris paribus. 
B)  free goods. 
C)  scarcity. 
D)  the margin. 
A)  ceteris paribus. 
B)  free goods. 
C)  scarcity. 
D)  the margin.

Question 6

The problem of determining how goods and services should be produced exists because:

Accepted Answer

A)  we do not have enough skilled workers relative to the number of unskilled workers. 
B)  we do not have enough unskilled workers relative to the number of skilled workers. 
C)  corporations want to avoid changing their methods of production. 
D)  most goods can be produced with different combinations of resources. 
A)  we do not have enough skilled workers relative to the number of unskilled workers. 
B)  we do not have enough unskilled workers relative to the number of skilled workers. 
C)  corporations want to avoid changing their methods of production. 
D)  most goods can be produced with different combinations of resources.

Question 7

Economics is a:

Accepted Answer

A)  social science that studies goods with no alternative uses. 
B)  natural science that studies goods with no alternative uses. 
C)  social science concerned chiefly with how people choose among alternatives. 
D)  social science concerned chiefly with reasons why society has unlimited resources. 
A)  social science that studies goods with no alternative uses. 
B)  natural science that studies goods with no alternative uses. 
C)  social science concerned chiefly with how people choose among alternatives. 
D)  social science concerned chiefly with reasons why society has unlimited resources.

Question 8

Two important notions in economics are the scarcity of resources and the tremendous magnitude of the wants of people.Given this, evaluate and explain the following statement: "The study of economics is essentially to investigate how to maximize the satisfaction of wants utilizing available resources."

Accepted Answer

The statement "The study of economics is

Question 9

The questions of what goods to produce, how to produce them, and for whom to produce them are of concern only in advanced industrial economies.

Accepted Answer

A) True 
 B)False

Question 10

A basic assumption used in many economic models is:

Accepted Answer

A)  as price goes up, the amount purchased will go up too. 
B)  as price goes up, less will be offered for sale on the market. 
C)  if the underlying theory doesn't represent reality, it is not useful. 
D)  ceteris paribus, which means all other things remain unchanged. 
A)  as price goes up, the amount purchased will go up too. 
B)  as price goes up, less will be offered for sale on the market. 
C)  if the underlying theory doesn't represent reality, it is not useful. 
D)  ceteris paribus, which means all other things remain unchanged.

Question 11

Individuals will usually make choices to minimize the value of some objective.

Accepted Answer

A) True 
 B)False

Question 12

The "all other things unchanged" assumption is useful because it:

Accepted Answer

A)  states the main economic objectives. 
B)  is a vehicle for determining whether a particular outcome is "good" or "bad.". 
C)  helps to approximate real-world conditions. 
D)  helps to restrict analysis to the effect of a single economic factor. 
A)  states the main economic objectives. 
B)  is a vehicle for determining whether a particular outcome is "good" or "bad.". 
C)  helps to approximate real-world conditions. 
D)  helps to restrict analysis to the effect of a single economic factor.

Question 13

Anything that has alternative uses has an opportunity cost and is, therefore, scarce.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is most likely an example of a free good?

Accepted Answer

A)  Sand in aquarium 
B)  Sand in the middle of a desert 
C)  Sand in a children's sandbox 
D)  Sand at the beach 
A)  Sand in aquarium 
B)  Sand in the middle of a desert 
C)  Sand in a children's sandbox 
D)  Sand at the beach

Question 15

The incorrect presumption that because two events tend to occur together, one must cause the other is the:

Accepted Answer

A)  confusion of economists. 
B)  blunder of science. 
C)  fallacy of false cause. 
D)  error of inclusion. 
A)  confusion of economists. 
B)  blunder of science. 
C)  fallacy of false cause. 
D)  error of inclusion.

Question 16

The models used in economics:

Accepted Answer

A)  are usually limited to variables that are directly related. 
B)  are essentially not reliable because they are not testable in the real world. 
C)  are of necessity unrealistic and have no relationship to the real world. 
D)  emphasize basic relationships by abstracting from complexities in the everyday world. 
A)  are usually limited to variables that are directly related. 
B)  are essentially not reliable because they are not testable in the real world. 
C)  are of necessity unrealistic and have no relationship to the real world. 
D)  emphasize basic relationships by abstracting from complexities in the everyday world.

Question 17

Distinguish between microeconomics and macroeconomics.

Accepted Answer

The answer of Distinguish between microeconomics and macroeconomics....

Question 18

One question that arises when determining for whom goods and services should be produced is:

Accepted Answer

A)  Who gets how much of the economic pie? 
B)  How can we import more goods for domestic consumption? 
C)  How can we reduce exports so as to leave more goods for domestic consumption? 
D)  Should society outlaw child labor? 
A)  Who gets how much of the economic pie? 
B)  How can we import more goods for domestic consumption? 
C)  How can we reduce exports so as to leave more goods for domestic consumption? 
D)  Should society outlaw child labor?

Question 19

A proposition about the relationship between two variables that can be proven false is called:

Accepted Answer

A)  a hypothesis. 
B)  a law. 
C)  a theory. 
D)  the scientific method. 
A)  a hypothesis. 
B)  a law. 
C)  a theory. 
D)  the scientific method.

Question 20

The concept of scarcity indicates that:

Accepted Answer

A)  most goods have no alternative uses. 
B)  almost all goods have alternative uses. 
C)  most decisions can be made without sacrificing alternatives. 
D)  certain societies are able to overcome the constraints imposed by alternative uses of resources. 
A)  most goods have no alternative uses. 
B)  almost all goods have alternative uses. 
C)  most decisions can be made without sacrificing alternatives. 
D)  certain societies are able to overcome the constraints imposed by alternative uses of resources.

"Smokers are more likely to be murdered than nonsmokers." This statement is an example of:

An example of a normative statement is:

A key theme fundamental to all of economics is:

`Briefly define scarcity, choice, and opportunity cost and explain carefully how they are related and why they are so essential in the study of economics.

When we are forced to make choices we are facing the concept of:

The problem of determining how goods and services should be produced exists because:

Economics is a:

The questions of what goods to produce, how to produce them, and for whom to produce them are of concern only in advanced industrial economies.

A basic assumption used in many economic models is:

Individuals will usually make choices to minimize the value of some objective.

The "all other things unchanged" assumption is useful because it:

Anything that has alternative uses has an opportunity cost and is, therefore, scarce.

Which of the following is most likely an example of a free good?

The incorrect presumption that because two events tend to occur together, one must cause the other is the:

The models used in economics:

Distinguish between microeconomics and macroeconomics.

One question that arises when determining for whom goods and services should be produced is:

A proposition about the relationship between two variables that can be proven false is called:

The concept of scarcity indicates that:

Confronting Scarcity: Choices in Production

Demand and Supply

Applications of Supply and Demand

Elasticity: a Measure of Response

Markets, Maximizers, and Efficiency

The Analysis of Consumer Choice

Production and Cost

Competitive Markets for Goods and Services

Monopoly

The World of Imperfect Competition

Wages and Employment in Perfect Competition

Interest Rates and the Markets for Capital and Natural Resources

Imperfectly Competitive Markets for Factors of Production

Public Finance and Public Choice

Antitrust Policy and Business Regulation

International Trade

The Economics of the Environment

Inequality, Poverty, and Discrimination

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Exam 1: Economics: The Study of Choice

"Smokers are more likely to be murdered than nonsmokers." This statement is an example of:

An example of a normative statement is:

A key theme fundamental to all of economics is:

`Briefly define scarcity, choice, and opportunity cost and explain carefully how they are related and why they are so essential in the study of economics.

When we are forced to make choices we are facing the concept of:

The problem of determining how goods and services should be produced exists because:

Economics is a:

The questions of what goods to produce, how to produce them, and for whom to produce them are of concern only in advanced industrial economies.

A basic assumption used in many economic models is:

Individuals will usually make choices to minimize the value of some objective.

The "all other things unchanged" assumption is useful because it:

Anything that has alternative uses has an opportunity cost and is, therefore, scarce.

Which of the following is most likely an example of a free good?

The incorrect presumption that because two events tend to occur together, one must cause the other is the:

The models used in economics:

Distinguish between microeconomics and macroeconomics.

One question that arises when determining for whom goods and services should be produced is:

A proposition about the relationship between two variables that can be proven false is called:

The concept of scarcity indicates that:

Confronting Scarcity: Choices in Production

Demand and Supply

Applications of Supply and Demand

Elasticity: a Measure of Response

Markets, Maximizers, and Efficiency

The Analysis of Consumer Choice

Production and Cost

Competitive Markets for Goods and Services

Monopoly

The World of Imperfect Competition

Wages and Employment in Perfect Competition

Interest Rates and the Markets for Capital and Natural Resources

Imperfectly Competitive Markets for Factors of Production

Public Finance and Public Choice

Antitrust Policy and Business Regulation

International Trade

The Economics of the Environment

Inequality, Poverty, and Discrimination

Filters