Question 1

What would happen if the world's resources were to suddenly double?

Accepted Answer

A)  The scarcity principle would still apply. 
B)  The scarcity principle would not be relevant. 
C)  Everyone's wants would be met. 
D)  No tradeoffs would be needed. 
A)  The scarcity principle would still apply. 
B)  The scarcity principle would not be relevant. 
C)  Everyone's wants would be met. 
D)  No tradeoffs would be needed.

Question 2

Which of the following is NOT a major area of study for economists?

Accepted Answer

A)  how people make decisions 
B)  how countries choose national leaders 
C)  how people interact with each other 
D)  how forces and trends affect the overall economy 
A)  how people make decisions 
B)  how countries choose national leaders 
C)  how people interact with each other 
D)  how forces and trends affect the overall economy

Question 3

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

Question 4

Which word comes from the Greek word for "one who manages a household"?

Accepted Answer

A)  market 
B)  consumer 
C)  producer 
D)  economy 
A)  market 
B)  consumer 
C)  producer 
D)  economy

Question 5

What is the effect of an increase in the money supply in the economy?

Accepted Answer

A)  It increases unemployment in the short run. 
B)  It increases inflation in the long run. 
C)  It increases inflation in the short run. 
D)  It increases unemployment in the long run. 
A)  It increases unemployment in the short run. 
B)  It increases inflation in the long run. 
C)  It increases inflation in the short run. 
D)  It increases unemployment in the long run.

Question 6

Which of the following is an example of a firm with market power?

Accepted Answer

A)  a deli in Winnipeg 
B)  a bike rental company in Victoria 
C)  the Science Centre in Vancouver 
D)  a farmer in Quebec 
A)  a deli in Winnipeg 
B)  a bike rental company in Victoria 
C)  the Science Centre in Vancouver 
D)  a farmer in Quebec

Question 7

What are two causes of market failure?

Accepted Answer

A)  externalities and market power 
B)  market power and incorrect forecasts of consumer demand 
C)  externalities and foreign competition 
D)  government intervention and foreign competition 
A)  externalities and market power 
B)  market power and incorrect forecasts of consumer demand 
C)  externalities and foreign competition 
D)  government intervention and foreign competition

Question 8

What has been one effect of a government-imposed seat belt law?

Accepted Answer

A)  fewer pedestrian deaths 
B)  safer driving 
C)  an increase in the number of accidents 
D)  everyone now wears seat belts 
A)  fewer pedestrian deaths 
B)  safer driving 
C)  an increase in the number of accidents 
D)  everyone now wears seat belts

Question 9

With the understanding that people respond to incentives,outline the possible outcome for teachers if the K-12 school year is extended to 11 months per year instead of the existing 10 months per year.

Accepted Answer

The concept of working longer per year w

Question 10

What was inflation in Canada in the 1990s?

Accepted Answer

A)  It was almost zero. 
B)  It was about 2 percent per year. 
C)  It was approaching double digits. 
D)  It was about 10 percent per year. 
A)  It was almost zero. 
B)  It was about 2 percent per year. 
C)  It was approaching double digits. 
D)  It was about 10 percent per year.

Question 11

If an externality is present in a market,what may enhance economic efficiency?

Accepted Answer

A)  government intervention 
B)  increased competition 
C)  better informed market participants 
D)  more defined property rights 
A)  government intervention 
B)  increased competition 
C)  better informed market participants 
D)  more defined property rights

Question 12

The tenth principle of economics shows the short-run tradeoff between inflation and economic growth.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is NOT a reason for the government to intervene in the market?

Accepted Answer

A)  to promote efficiency 
B)  to enforce property rights 
C)  to promote equity 
D)  to protect an industry 
A)  to promote efficiency 
B)  to enforce property rights 
C)  to promote equity 
D)  to protect an industry

Question 14

The average cost per seat on a train trip from Edmonton to Jasper is $140.Suppose no refreshments are served and three seats are empty.How could the train company increase its profit?

Accepted Answer

A)  if it charged no less than $140 for the three remaining seats 
B)  if it charged more than $140 for the three remaining seats 
C)  if it charged any ticket price above $0 for the remaining seats 
D)  if it left the seats empty 
A)  if it charged no less than $140 for the three remaining seats 
B)  if it charged more than $140 for the three remaining seats 
C)  if it charged any ticket price above $0 for the remaining seats 
D)  if it left the seats empty

Question 15

When the government redistributes income from the rich to the poor,what is the result?

Accepted Answer

A)  Efficiency is improved,but equity is not. 
B)  Both rich people and poor people benefit directly. 
C)  People work less and produce fewer goods and services. 
D)  Rich people consume fewer goods,but poor people consume more goods,resulting in no real change. 
A)  Efficiency is improved,but equity is not. 
B)  Both rich people and poor people benefit directly. 
C)  People work less and produce fewer goods and services. 
D)  Rich people consume fewer goods,but poor people consume more goods,resulting in no real change.

Question 16

Which statement is consistent with the tenth principle of economics?

Accepted Answer

A)  If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will temporarily fall. 
B)  If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will temporarily rise. 
C)  If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will permanently fall. 
D)  If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will permanently rise. 
A)  If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will temporarily fall. 
B)  If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will temporarily rise. 
C)  If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will permanently fall. 
D)  If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will permanently rise.

Question 17

In the former Soviet Union,producers were paid for meeting output targets,not for selling products.Under those circumstances,what were the economic incentives for producers?

Accepted Answer

A)  to produce good quality products which last longer so output targets can be reduced 
B)  to conserve on costs,so as to maintain efficiency in the economy 
C)  to produce enough to meet the output target,without regard for quality or cost 
D)  to produce those products that society desires most 
A)  to produce good quality products which last longer so output targets can be reduced 
B)  to conserve on costs,so as to maintain efficiency in the economy 
C)  to produce enough to meet the output target,without regard for quality or cost 
D)  to produce those products that society desires most

Question 18

What is the best example of a marginal change?

Accepted Answer

A)  After graduating from university,Audrey's income increases from $500 per month to $3000 per month. 
B)  In 2015 minimum wage in Saskatchewan increased from $10 per hour to $10.20. 
C)  Housing prices in an area increase by 40% when a new highway is built in a small town. 
D)  A hard freeze wipes out half of the tobacco crop in Ontario and the price of cigarettes doubles. 
A)  After graduating from university,Audrey's income increases from $500 per month to $3000 per month. 
B)  In 2015 minimum wage in Saskatchewan increased from $10 per hour to $10.20. 
C)  Housing prices in an area increase by 40% when a new highway is built in a small town. 
D)  A hard freeze wipes out half of the tobacco crop in Ontario and the price of cigarettes doubles.

Question 19

Who coined the term "invisible hand"?

Accepted Answer

A)  Adam Smith 
B)  David Ricardo 
C)  John Maynard Keynes 
D)  Milton Friedman 
A)  Adam Smith 
B)  David Ricardo 
C)  John Maynard Keynes 
D)  Milton Friedman

Question 20

What are economists illustrating when they use the phrase "There is no such thing as a free lunch"?

Accepted Answer

A)  how inflation increases prices 
B)  that to get one thing,we must give up something else 
C)  that nothing is free in a market economy 
D)  that if something looks too good to be true,it probably is 
A)  how inflation increases prices 
B)  that to get one thing,we must give up something else 
C)  that nothing is free in a market economy 
D)  that if something looks too good to be true,it probably is

What would happen if the world's resources were to suddenly double?

Which of the following is NOT a major area of study for economists?

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

Which word comes from the Greek word for "one who manages a household"?

What is the effect of an increase in the money supply in the economy?

Which of the following is an example of a firm with market power?

What are two causes of market failure?

What has been one effect of a government-imposed seat belt law?

With the understanding that people respond to incentives,outline the possible outcome for teachers if the K-12 school year is extended to 11 months per year instead of the existing 10 months per year.

What was inflation in Canada in the 1990s?

If an externality is present in a market,what may enhance economic efficiency?

The tenth principle of economics shows the short-run tradeoff between inflation and economic growth.

Which of the following is NOT a reason for the government to intervene in the market?

The average cost per seat on a train trip from Edmonton to Jasper is $140.Suppose no refreshments are served and three seats are empty.How could the train company increase its profit?

When the government redistributes income from the rich to the poor,what is the result?

Which statement is consistent with the tenth principle of economics?

In the former Soviet Union,producers were paid for meeting output targets,not for selling products.Under those circumstances,what were the economic incentives for producers?

What is the best example of a marginal change?

Who coined the term "invisible hand"?

What are economists illustrating when they use the phrase "There is no such thing as a free lunch"?

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 Small 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

What would happen if the world's resources were to suddenly double?

Which of the following is NOT a major area of study for economists?

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

Which word comes from the Greek word for "one who manages a household"?

What is the effect of an increase in the money supply in the economy?

Which of the following is an example of a firm with market power?

What are two causes of market failure?

What has been one effect of a government-imposed seat belt law?

With the understanding that people respond to incentives,outline the possible outcome for teachers if the K-12 school year is extended to 11 months per year instead of the existing 10 months per year.

What was inflation in Canada in the 1990s?

If an externality is present in a market,what may enhance economic efficiency?

The tenth principle of economics shows the short-run tradeoff between inflation and economic growth.

Which of the following is NOT a reason for the government to intervene in the market?

The average cost per seat on a train trip from Edmonton to Jasper is $140.Suppose no refreshments are served and three seats are empty.How could the train company increase its profit?

When the government redistributes income from the rich to the poor,what is the result?

Which statement is consistent with the tenth principle of economics?

In the former Soviet Union,producers were paid for meeting output targets,not for selling products.Under those circumstances,what were the economic incentives for producers?

What is the best example of a marginal change?

Who coined the term "invisible hand"?

What are economists illustrating when they use the phrase "There is no such thing as a free lunch"?

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 Small 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