Question 1

Ceteris paribus means

Accepted Answer

A)  "one variable too many." 
B)  "the correct relationship specified." 
C)  "assuming economic motives." 
D)  "all other things constant" or "nothing else changes." 
A)  "one variable too many." 
B)  "the correct relationship specified." 
C)  "assuming economic motives." 
D)  "all other things constant" or "nothing else changes."

Question 2

Explain why the ceteris paribus assumption is essential when assessing an economic theory.Give an example to help support your answer.

Accepted Answer

Economists use the ceteris paribus assum

Question 3

Economists use the terms resource and input as synonyms.

Accepted Answer

A) True 
 B)False

Question 4

In every economy people vie for the economy's rationing device,a process called

Accepted Answer

A)  competition. 
B)  entrepreneurship. 
C)  marginal benefit. 
D)  positive economics. 
A)  competition. 
B)  entrepreneurship. 
C)  marginal benefit. 
D)  positive economics.

Question 5

The higher the opportunity cost of attending college,

Accepted Answer

A)  the more likely an individual will go to college. 
B)  the more economics classes an individual will take at college. 
C)  the fewer economics classes an individual will take at college. 
D)  the less likely an individual will go to college. 
A)  the more likely an individual will go to college. 
B)  the more economics classes an individual will take at college. 
C)  the fewer economics classes an individual will take at college. 
D)  the less likely an individual will go to college.

Question 6

-Refer to Exhibit 1-2.Based on the data provided in this table,what type of relationship exists between variables X and Y?

Accepted Answer

A)  inverse 
B)  direct 
C)  independent 
D)  There is no relationship between variables X and Y. 
A)  inverse 
B)  direct 
C)  independent 
D)  There is no relationship between variables X and Y.

Question 7

Economists use the word utility to describe the satisfaction one receives from a good.

Accepted Answer

A) True 
 B)False

Question 8

Define the term scarcity and discuss two of its consequences.

Accepted Answer

Scarcity is the condition in which our w

Question 9

Is it possible for mandatory seatbelt laws to increase vehicle fatalities?

Accepted Answer

A)  Yes,if the number of accidents increases by a greater percentage than the number of deaths per accident decreases. 
B)  No,because wearing seatbelts decreases the number of deaths per accident. 
C)  No,because wearing seatbelts decreases the number of accidents. 
D)  There is not enough information to answer the question. 
A)  Yes,if the number of accidents increases by a greater percentage than the number of deaths per accident decreases. 
B)  No,because wearing seatbelts decreases the number of deaths per accident. 
C)  No,because wearing seatbelts decreases the number of accidents. 
D)  There is not enough information to answer the question.

Question 10

Amy's opportunity cost of going to the movies is

Accepted Answer

A)  the price of the ticket. 
B)  zero,if she has a gift card that covers the cost of the movie. 
C)  the price of the ticket plus the value to Amy of what she would have chosen to do with her time had she not chosen to go to the movies. 
D)  both b and c 
A)  the price of the ticket. 
B)  zero,if she has a gift card that covers the cost of the movie. 
C)  the price of the ticket plus the value to Amy of what she would have chosen to do with her time had she not chosen to go to the movies. 
D)  both b and c

Question 11

What does it mean if a person makes a "decision at the margin"?

Accepted Answer

A)  The person compares additional benefits and additional costs when deciding what to do. 
B)  The person weighs the good against the bad and then decides what to do. 
C)  The person is more likely to say yes than to say no. 
D)  The person compares marginal benefits and total costs and then decides what to do. 
E)  The person makes a decision based on a condition. 
A)  The person compares additional benefits and additional costs when deciding what to do. 
B)  The person weighs the good against the bad and then decides what to do. 
C)  The person is more likely to say yes than to say no. 
D)  The person compares marginal benefits and total costs and then decides what to do. 
E)  The person makes a decision based on a condition.

Question 12

Harry is trying to take one more class this semester.He is weighing the marginal benefit of taking one more class to the marginal cost of taking one more class.Which economic concept is most closely related to Harry's decision-making process?

Accepted Answer

A)  macroeconomics 
B)  exchange 
C)  rationing devices 
D)  decisions made at the margin 
A)  macroeconomics 
B)  exchange 
C)  rationing devices 
D)  decisions made at the margin

Question 13

Explain what an economist means when he says,"You don't find any $10 bills on the sidewalk."

Accepted Answer

What an economist means by this statemen

Question 14

Some economic studies have shown that mandatory seat belt laws do not lead to a reduction in traffic fatalities.

Accepted Answer

A) True 
 B)False

Question 15

A person goes into a store and buys a computer for $1,210.In this case,price is acting as a

Accepted Answer

A)  resource. 
B)  good. 
C)  rationing device. 
D)  capital instrument. 
E)  factor of production. 
A)  resource. 
B)  good. 
C)  rationing device. 
D)  capital instrument. 
E)  factor of production.

Question 16

Many people buy one newspaper per day,but rarely do they buy two of the same newspapers on the same day.What is the economic justification for this behavior?

Accepted Answer

A)  The marginal benefit of purchasing the second newspaper exceeds the marginal cost of purchasing that paper. 
B)  The marginal cost of purchasing the second newspaper exceeds the marginal benefit of purchasing that paper. 
C)  The marginal benefit of purchasing the second newspaper equals the marginal cost of purchasing that paper. 
D)  none of the above is an appropriate economic justification for this behavior. 
A)  The marginal benefit of purchasing the second newspaper exceeds the marginal cost of purchasing that paper. 
B)  The marginal cost of purchasing the second newspaper exceeds the marginal benefit of purchasing that paper. 
C)  The marginal benefit of purchasing the second newspaper equals the marginal cost of purchasing that paper. 
D)  none of the above is an appropriate economic justification for this behavior.

Question 17

A rationing device is a method used to resolve who gets what of available goods and resources.

Accepted Answer

A) True 
 B)False

Question 18

Define the term rationing device and give an example of each of three possible rationing devices.Explain how scarcity implies the need for a rationing device.

Accepted Answer

A rationing device is a mechanism used t

Question 19

The higher the opportunity cost of making a new friend,the more likely one is to make a new friend,​ceteris paribus​.

Accepted Answer

A) True 
 B)False

Question 20

The branch of economics that studies the decisions made by individuals and firms is called macroeconomics.

Accepted Answer

A) True 
 B)False

Exam 1: What Economics Is About

Ceteris paribus means

Explain why the ceteris paribus assumption is essential when assessing an economic theory.Give an example to help support your answer.

Economists use the terms resource and input as synonyms.

In every economy people vie for the economy's rationing device,a process called

The higher the opportunity cost of attending college,

-Refer to Exhibit 1-2.Based on the data provided in this table,what type of relationship exists between variables X and Y?

Economists use the word utility to describe the satisfaction one receives from a good.

Define the term scarcity and discuss two of its consequences.

Is it possible for mandatory seatbelt laws to increase vehicle fatalities?

Amy's opportunity cost of going to the movies is

What does it mean if a person makes a "decision at the margin"?

Harry is trying to take one more class this semester.He is weighing the marginal benefit of taking one more class to the marginal cost of taking one more class.Which economic concept is most closely related to Harry's decision-making process?

Explain what an economist means when he says,"You don't find any $10 bills on the sidewalk."

Some economic studies have shown that mandatory seat belt laws do not lead to a reduction in traffic fatalities.

A person goes into a store and buys a computer for $1,210.In this case,price is acting as a

Many people buy one newspaper per day,but rarely do they buy two of the same newspapers on the same day.What is the economic justification for this behavior?

A rationing device is a method used to resolve who gets what of available goods and resources.

Define the term rationing device and give an example of each of three possible rationing devices.Explain how scarcity implies the need for a rationing device.

The higher the opportunity cost of making a new friend,the more likely one is to make a new friend,​ceteris paribus​.

The branch of economics that studies the decisions made by individuals and firms is called macroeconomics.

Production Possibilities Frontier Framework

Supply and Demand: Theory

Prices: Free,controlled,and Relative

Supply,demand,and Price: Applications

Elasticity

Consumer Choice: Maximizing Utility and Behavioral Economics

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition, oligopoly, and Game Theory

Government and Product Markets: Antitrust and Regulation

Factor Markets: With Emphasis on the Labor Market

Wages,union,and Labor

The Distribution of Income and Poverty

Interest,rent,and Profit

Market Failure: Externalities, public Goods, and Asymmetric Information

Public Choice and Special-Interest-Group Politics

Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

International Trade

International Finance

The Economic Case for and Against Government: Five Topics Considered

Stocks,bonds,futures,and Options

Stocks,bonds,futures,and Options

Filters

The higher the opportunity cost of making a new friend,the more likely one is to make a new friend,ceteris paribus.