Question 1

Trinh quits his $80 000-a-year job to become a full-time volunteer at a museum.The opportunity cost of his decision is __________.

Accepted Answer

A)  0 since he will no longer be earning a salary 
B)  depends on the 'going rate' of museum employees 
C)  at least $80 000 
D)  the value he attributes to the joy of working at a museum 
A)  0 since he will no longer be earning a salary 
B)  depends on the 'going rate' of museum employees 
C)  at least $80 000 
D)  the value he attributes to the joy of working at a museum

Question 2

An economic model is a simplified version of reality used to analyse real-world economic situations.

Accepted Answer

A) True 
 B)False

Question 3

What is a marginal benefit?
__________________________________________________________________________________________________________________________________________________________________________________________

Accepted Answer

Marginal benefit is

Question 4

Economics does not study correct or incorrect behaviours but rather it assumes that economic agents behave ________,meaning they make the best decisions given their knowledge of the costs and benefits.

Accepted Answer

A)  equitably 
B)  rationally 
C)  emotionally 
D)  selfishly 
A)  equitably 
B)  rationally 
C)  emotionally 
D)  selfishly

Question 5

All of the following are part of an economic model except _________.

Accepted Answer

A)  assumptions 
B)  hypotheses 
C)  data 
D)  opinions 
A)  assumptions 
B)  hypotheses 
C)  data 
D)  opinions

Question 6

How are the fundamental economic questions answered in a market economy?

Accepted Answer

A)  The government alone decides the answers. 
B)  Individuals, firms, and the government interact in markets to decide the answers to these questions. 
C)  Households and firms interact in markets to decide the answers to these questions. 
D)  Large corporations alone decide the answers. 
A)  The government alone decides the answers. 
B)  Individuals, firms, and the government interact in markets to decide the answers to these questions. 
C)  Households and firms interact in markets to decide the answers to these questions. 
D)  Large corporations alone decide the answers.

Question 7

The term 'market' refers to trading arrangements by which buyers and sellers come together.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following questions or statements regarding medical school is normative?

Accepted Answer

A)  How do changes in expected future incomes affect the decisions of medical students about which specialty to choose? 
B)  Medical students who enter specialised fields make a larger contribution to society than do student who enter primary care. 
C)  What role does tuition play in a student's decision about whether to attend medical school? 
D)  Have tuition increases had a large effect or a small effect on the number of applications to medical school? 
A)  How do changes in expected future incomes affect the decisions of medical students about which specialty to choose? 
B)  Medical students who enter specialised fields make a larger contribution to society than do student who enter primary care. 
C)  What role does tuition play in a student's decision about whether to attend medical school? 
D)  Have tuition increases had a large effect or a small effect on the number of applications to medical school?

Question 9

If the marginal cost of keeping a doctor's office open one additional hour per day is $200,then the doctor should keep the office open for one extra hour________.

Accepted Answer

A)  only if the marginal benefit she receives is greater than $200 plus an acceptable profit margin 
B)  as long as the marginal benefit she receives is just equal to or greater than $200 
C)  as long as the marginal cost does not rise 
D)  until the marginal benefit she receives reaches zero 
A)  only if the marginal benefit she receives is greater than $200 plus an acceptable profit margin 
B)  as long as the marginal benefit she receives is just equal to or greater than $200 
C)  as long as the marginal cost does not rise 
D)  until the marginal benefit she receives reaches zero

Question 10

Examining the conditions that could lead to unemployment in an economy is an example of a microeconomics topic.

Accepted Answer

A) True 
 B)False

Question 11

Mr.Peabody chooses to invest in companies that produce goods and services at the lowest possible cost.Mr.Peabody is investing in companies that are _________.

Accepted Answer

A)  allocatively efficient 
B)  productively efficient 
C)  guaranteed to make a profit 
D)  all of the above 
A)  allocatively efficient 
B)  productively efficient 
C)  guaranteed to make a profit 
D)  all of the above

Question 12

Consider the following economic agents: 
A.the government
B.consumers
C.producers
Who,in a centrally planned economy,decides what goods and services will be produced with the scarce resources available in that economy?

Accepted Answer

A)  The government 
B)  Producers 
C)  Consumers 
D)  Consumers and producers 
A)  The government 
B)  Producers 
C)  Consumers 
D)  Consumers and producers

Question 13

What term in economics refers to a group of buyers and sellers of a product and the arrangement by which they come together to trade?

Accepted Answer

A)  Collective 
B)  Cooperative 
C)  Market 
D)  Trade-off 
A)  Collective 
B)  Cooperative 
C)  Market 
D)  Trade-off

Question 14

What is the extra cost associated with undertaking an activity called?

Accepted Answer

A)  Net loss 
B)  Marginal cost 
C)  Opportunity cost 
D)  Foregone cost 
A)  Net loss 
B)  Marginal cost 
C)  Opportunity cost 
D)  Foregone cost

Question 15

The Coffee Nook,a small cafe near campus,sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each.What is the opportunity cost of buying a Russian tea cake?

Accepted Answer

A)  2 1/2 cappuccinos 
B)  2/5 of a cappuccino 
C)  $2.50 
D)  $1.00 
A)  2 1/2 cappuccinos 
B)  2/5 of a cappuccino 
C)  $2.50 
D)  $1.00

Question 16

What is meant by the statement that 'optimal decisions are made at the margin'?
__________________________________________________________________________________________________________________________________________________________________________________________

Accepted Answer

In economics,the word 'marginal' means '

Question 17

Allison's Auto Art is a company that applies pinstripes to vehicles.Allison's cost for a basic one-colour pinstriping job is $35,and she charges $95 for this service.For a total price of $175,Allison will apply a fancier three-colour pinstripe application to an automobile,a service that adds an additional $40 to the total cost of the package.What is Allison's marginal benefit if she sells a basic one-colour job?

Accepted Answer

A)  $35 
B)  $60 
C)  $95 
D)  The marginal benefit cannot be determined. 
A)  $35 
B)  $60 
C)  $95 
D)  The marginal benefit cannot be determined.

Question 18

Optimal decisions are made at the point where marginal cost equals zero.

Accepted Answer

A) True 
 B)False

Question 19

Arlene quits her $125 000-a-year job to take care of her ailing parents.What is the opportunity cost of her decision?

Accepted Answer

A)  Zero, since she will no longer be earning a salary 
B)  It depends on the 'going rate' for home-care providers 
C)  At least $125 000 
D)  The value she attributes to the satisfaction she receives from taking care of her parents 
A)  Zero, since she will no longer be earning a salary 
B)  It depends on the 'going rate' for home-care providers 
C)  At least $125 000 
D)  The value she attributes to the satisfaction she receives from taking care of her parents

Question 20

Suppose that to increase sales of hybrid vehicles,auto manufacturers are offering large cash incentives.This is an example of a macroeconomics topic.

Accepted Answer

A) True 
 B)False

Trinh quits his $80 000-a-year job to become a full-time volunteer at a museum.The opportunity cost of his decision is __________.

An economic model is a simplified version of reality used to analyse real-world economic situations.

What is a marginal benefit? __________________________________________________________________________________________________________________________________________________________________________________________

Economics does not study correct or incorrect behaviours but rather it assumes that economic agents behave ________,meaning they make the best decisions given their knowledge of the costs and benefits.

All of the following are part of an economic model except _________.

How are the fundamental economic questions answered in a market economy?

The term 'market' refers to trading arrangements by which buyers and sellers come together.

Which of the following questions or statements regarding medical school is normative?

If the marginal cost of keeping a doctor's office open one additional hour per day is $200,then the doctor should keep the office open for one extra hour________.

Examining the conditions that could lead to unemployment in an economy is an example of a microeconomics topic.

Mr.Peabody chooses to invest in companies that produce goods and services at the lowest possible cost.Mr.Peabody is investing in companies that are _________.

Consider the following economic agents: A.the government B.consumers C.producers Who,in a centrally planned economy,decides what goods and services will be produced with the scarce resources available in that economy?

What term in economics refers to a group of buyers and sellers of a product and the arrangement by which they come together to trade?

What is the extra cost associated with undertaking an activity called?

The Coffee Nook,a small cafe near campus,sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each.What is the opportunity cost of buying a Russian tea cake?

What is meant by the statement that 'optimal decisions are made at the margin'? __________________________________________________________________________________________________________________________________________________________________________________________

Optimal decisions are made at the point where marginal cost equals zero.

Arlene quits her $125 000-a-year job to take care of her ailing parents.What is the opportunity cost of her decision?

Suppose that to increase sales of hybrid vehicles,auto manufacturers are offering large cash incentives.This is an example of a macroeconomics topic.

Choices and Trade-Offs in the Market

Where Prices Come From: the Interaction of Demand and Supply

Elasticity: The Responsiveness of Demand and Supply

Economic Efficiency,government Price Setting and Taxes

Technology,production and Costs

Firms in Perfectly Competitive Markets

Monopoly Markets

Monopolistic Competition and Oligopoly

The Markets for Labour and Other Factors of Production

Government Intervention in the Market

Social Policy and Inequality

Gdp: Measuring Total Production, income and Economic Growth

Unemployment and Inflation

Aggregate Demand and Aggregate Supply Analysis

Money,banks and the Reserve Bank of Australia

Monetary Policy

Fiscal Policy

Comparative Advantage and the Gains From International Trade

Macroeconomics in an Open Economy

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Exam 1: Economics: Foundations and Models

Trinh quits his $80 000-a-year job to become a full-time volunteer at a museum.The opportunity cost of his decision is __________.

An economic model is a simplified version of reality used to analyse real-world economic situations.

What is a marginal benefit? __________________________________________________________________________________________________________________________________________________________________________________________

Economics does not study correct or incorrect behaviours but rather it assumes that economic agents behave ________,meaning they make the best decisions given their knowledge of the costs and benefits.

All of the following are part of an economic model except _________.

How are the fundamental economic questions answered in a market economy?

The term 'market' refers to trading arrangements by which buyers and sellers come together.

Which of the following questions or statements regarding medical school is normative?

If the marginal cost of keeping a doctor's office open one additional hour per day is $200,then the doctor should keep the office open for one extra hour________.

Examining the conditions that could lead to unemployment in an economy is an example of a microeconomics topic.

Mr.Peabody chooses to invest in companies that produce goods and services at the lowest possible cost.Mr.Peabody is investing in companies that are _________.

Consider the following economic agents: A.the government B.consumers C.producers Who,in a centrally planned economy,decides what goods and services will be produced with the scarce resources available in that economy?

What term in economics refers to a group of buyers and sellers of a product and the arrangement by which they come together to trade?

What is the extra cost associated with undertaking an activity called?

The Coffee Nook,a small cafe near campus,sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each.What is the opportunity cost of buying a Russian tea cake?

What is meant by the statement that 'optimal decisions are made at the margin'? __________________________________________________________________________________________________________________________________________________________________________________________

Optimal decisions are made at the point where marginal cost equals zero.

Arlene quits her $125 000-a-year job to take care of her ailing parents.What is the opportunity cost of her decision?

Suppose that to increase sales of hybrid vehicles,auto manufacturers are offering large cash incentives.This is an example of a macroeconomics topic.

Choices and Trade-Offs in the Market

Where Prices Come From: the Interaction of Demand and Supply

Elasticity: The Responsiveness of Demand and Supply

Economic Efficiency,government Price Setting and Taxes

Technology,production and Costs

Firms in Perfectly Competitive Markets

Monopoly Markets

Monopolistic Competition and Oligopoly

The Markets for Labour and Other Factors of Production

Government Intervention in the Market

Social Policy and Inequality

Gdp: Measuring Total Production, income and Economic Growth

Unemployment and Inflation

Aggregate Demand and Aggregate Supply Analysis

Money,banks and the Reserve Bank of Australia

Monetary Policy

Fiscal Policy

Comparative Advantage and the Gains From International Trade

Macroeconomics in an Open Economy

Filters