Question 1

Which of the following is included in the study of macroeconomics?

Accepted Answer

A)  How households make a purchasing decision. 
B)  Market for laptops. 
C)  Flows of imports and exports. 
D)  Prices of cars. 
A)  How households make a purchasing decision. 
B)  Market for laptops. 
C)  Flows of imports and exports. 
D)  Prices of cars. C

Question 2

Policies to lower the price index of goods in the nation are a concern of:

Accepted Answer

A)  macroeconomics. 
B)  microeconomics. 
C)  both microeconomics and macroeconomics. 
D)  political science. 
A)  macroeconomics. 
B)  microeconomics. 
C)  both microeconomics and macroeconomics. 
D)  political science. A

Question 3

'It is not fair to increase the federal minimum wage because it causes an increase in unemployment among teenagers.' This is a:

Accepted Answer

A)  statement of positive economics. 
B)  statement of normative economics. 
C)  testable value judgement. 
D)  fallacy of composition. 
A)  statement of positive economics. 
B)  statement of normative economics. 
C)  testable value judgement. 
D)  fallacy of composition. B

Question 4

Policies to determine the price of troll dolls are a concern of macroeconomics.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is a macroeconomics topic?

Accepted Answer

A)  The effect of price change on the supply of tomatoes. 
B)  The market price of electricity. 
C)  The interest rate and unemployment. 
D)  The demand for fuel efficient cars. 
E)  Effects of farm subsidies on food prices. 
A)  The effect of price change on the supply of tomatoes. 
B)  The market price of electricity. 
C)  The interest rate and unemployment. 
D)  The demand for fuel efficient cars. 
E)  Effects of farm subsidies on food prices.

Question 6

Economics studies decision making by a single individual.

Accepted Answer

A) True 
 B)False

Question 7

The statement: 'It is better to suffer a little more unemployment than a little lower prices', is an example of normative economic analysis.

Accepted Answer

A) True 
 B)False

Question 8

A television network newscaster reports that the national inflation rate the past year equalled 4 per cent. This report would be of particular interest to a _____.

Accepted Answer

A)  microeconomist 
B)  normative economist 
C)  macroeconomist 
D)  ceteris paribus 
E)  social science economist 
A)  microeconomist 
B)  normative economist 
C)  macroeconomist 
D)  ceteris paribus 
E)  social science economist

Question 9

An economic model is useful only if it:

Accepted Answer

A)  contains no positive statements. 
B)  captures all the complexities of reality. 
C)  yields accurate predictions with policy implication. 
D)  contains all normative statements. 
A)  contains no positive statements. 
B)  captures all the complexities of reality. 
C)  yields accurate predictions with policy implication. 
D)  contains all normative statements.

Question 10

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

Accepted Answer

A)  The inflation rate in Australia decreased from 4 per cent last year to 3 per cent this year as a result of lower energy prices. 
B)  The economy grew at an annual rate of 5 per cent during the first quarter of this year. 
C)  Australia should use more renewable energy to reduce greenhouse gas emissions. 
D)  An increase in international trade benefits some workers but hurts others. 
A)  The inflation rate in Australia decreased from 4 per cent last year to 3 per cent this year as a result of lower energy prices. 
B)  The economy grew at an annual rate of 5 per cent during the first quarter of this year. 
C)  Australia should use more renewable energy to reduce greenhouse gas emissions. 
D)  An increase in international trade benefits some workers but hurts others.

Question 11

Which of the following is the best example of a non-renewable resource?

Accepted Answer

A)  Forests. 
B)  Oil. 
C)  Clean air. 
D)  Fish in the ocean. 
A)  Forests. 
B)  Oil. 
C)  Clean air. 
D)  Fish in the ocean.

Question 12

All of the following are examples of capital except:

Accepted Answer

A)  the robot used to help produce your car. 
B)  a computer used by your lecturer to write this exam. 
C)  the factory that produces the costume jewellery you buy. 
D)  the inventory of unsold goods at your local hardware store. 
E)  an uncut diamond that you discover in your backyard. 
A)  the robot used to help produce your car. 
B)  a computer used by your lecturer to write this exam. 
C)  the factory that produces the costume jewellery you buy. 
D)  the inventory of unsold goods at your local hardware store. 
E)  an uncut diamond that you discover in your backyard.

Question 13

Scarcity is a situation:

Accepted Answer

A)  where people's needs exceed their resources. 
B)  where people's wants exceed their resources. 
C)  where the quantity of resources is sufficient to meet all wants. 
D)  where people's needs exceed other people's resources. 
E)  where the quantity of resources is sufficient to meet all needs. 
A)  where people's needs exceed their resources. 
B)  where people's wants exceed their resources. 
C)  where the quantity of resources is sufficient to meet all wants. 
D)  where people's needs exceed other people's resources. 
E)  where the quantity of resources is sufficient to meet all needs.

Question 14

Microeconomics deals with the analysis of all the following except how:

Accepted Answer

A)  the wages of doctors are determined. 
B)  Honda decides to price its cars. 
C)  to deal with the market power. 
D)  the monetary policy has changed. 
E)  monopolies and competitive markets differ. 
A)  the wages of doctors are determined. 
B)  Honda decides to price its cars. 
C)  to deal with the market power. 
D)  the monetary policy has changed. 
E)  monopolies and competitive markets differ.

Question 15

The Minister for Employment states that wage rates in the country have risen by 2 per cent in the past year. The head of a local labour union argues that wages have to be increased more to match the 3 per cent rate of inflation. The Minister's statement is a _____ economic statement and the union head's statement is a _____ economic statement.

Accepted Answer

A)  normative, normative 
B)  normative, positive 
C)  positive, normative 
D)  positive, positive 
A)  normative, normative 
B)  normative, positive 
C)  positive, normative 
D)  positive, positive

Question 16

Which of the following is closest to the definition of capital?

Accepted Answer

A)  Money in your bank account. 
B)  Factories and machinery. 
C)  Borrowed money. 
D)  The ability of an individual to create financial capital. 
E)  Lakes and lands. 
A)  Money in your bank account. 
B)  Factories and machinery. 
C)  Borrowed money. 
D)  The ability of an individual to create financial capital. 
E)  Lakes and lands.

Question 17

Normative statements:

Accepted Answer

A)  can always be tested. 
B)  are based on value judgements. 
C)  are not based on facts. 
D)  do not express a collective opinion on a subject. 
A)  can always be tested. 
B)  are based on value judgements. 
C)  are not based on facts. 
D)  do not express a collective opinion on a subject.

Question 18

An economic model:

Accepted Answer

A)  cannot be rejected. 
B)  cannot be tested. 
C)  always yields accurate predictions. 
D)  is valid if the evidence is consistent with the predictions. 
A)  cannot be rejected. 
B)  cannot be tested. 
C)  always yields accurate predictions. 
D)  is valid if the evidence is consistent with the predictions.

Question 19

Select the positive statement that completes the following sentence. 'If the competition is prohibited in the car manufacturing industry:

Accepted Answer

A)  cost per unit of output will rise.' 
B)  cars will be priced low.' 
C)  the rate of inflation should hold steady.' 
D)  government should pay compensation to workers.' 
A)  cost per unit of output will rise.' 
B)  cars will be priced low.' 
C)  the rate of inflation should hold steady.' 
D)  government should pay compensation to workers.'

Question 20

Normative economics deals with _____ and positive economics deals with _____.

Accepted Answer

A)  opinions, facts 
B)  fiction, fact 
C)  microeconomics, macroeconomics 
D)  negative aspects, positive aspects 
A)  opinions, facts 
B)  fiction, fact 
C)  microeconomics, macroeconomics 
D)  negative aspects, positive aspects

Which of the following is included in the study of macroeconomics?

Policies to lower the price index of goods in the nation are a concern of:

'It is not fair to increase the federal minimum wage because it causes an increase in unemployment among teenagers.' This is a:

Policies to determine the price of troll dolls are a concern of macroeconomics.

Which of the following is a macroeconomics topic?

Economics studies decision making by a single individual.

The statement: 'It is better to suffer a little more unemployment than a little lower prices', is an example of normative economic analysis.

A television network newscaster reports that the national inflation rate the past year equalled 4 per cent. This report would be of particular interest to a _____.

An economic model is useful only if it:

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

Which of the following is the best example of a non-renewable resource?

All of the following are examples of capital except:

Scarcity is a situation:

Microeconomics deals with the analysis of all the following except how:

Which of the following is closest to the definition of capital?

Normative statements:

An economic model:

Select the positive statement that completes the following sentence. 'If the competition is prohibited in the car manufacturing industry:

Normative economics deals with _ and positive economics deals with _.

Applying Graphs to Economics

Production Possibilities and Opportunity Cost

Market Demand and Supply

Markets in Action

Elasticity of Demand and Supply

Production Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Policy Issues: Housing Affordability and Climate Change

Measuring the Size of the Economy

Business Cycles and Economic Growth

Inflation and Unemployment

A Simple Model of the Macro Economy

The Monetary and Financial System

Macroeconomic Policy I: Monetary Policy

Macroeconomic Policy II: Fiscal Policy

International Trade and Finance

Filters

Exam 1: Thinking Like an Economist

Which of the following is included in the study of macroeconomics?

Policies to lower the price index of goods in the nation are a concern of:

'It is not fair to increase the federal minimum wage because it causes an increase in unemployment among teenagers.' This is a:

Policies to determine the price of troll dolls are a concern of macroeconomics.

Which of the following is a macroeconomics topic?

Economics studies decision making by a single individual.

The statement: 'It is better to suffer a little more unemployment than a little lower prices', is an example of normative economic analysis.

A television network newscaster reports that the national inflation rate the past year equalled 4 per cent. This report would be of particular interest to a _____.

An economic model is useful only if it:

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

Which of the following is the best example of a non-renewable resource?

All of the following are examples of capital except:

Scarcity is a situation:

Microeconomics deals with the analysis of all the following except how:

Which of the following is closest to the definition of capital?

Normative statements:

An economic model:

Select the positive statement that completes the following sentence. 'If the competition is prohibited in the car manufacturing industry:

Normative economics deals with _____ and positive economics deals with _____.

Applying Graphs to Economics

Production Possibilities and Opportunity Cost

Market Demand and Supply

Markets in Action

Elasticity of Demand and Supply

Production Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Policy Issues: Housing Affordability and Climate Change

Measuring the Size of the Economy

Business Cycles and Economic Growth

Inflation and Unemployment

A Simple Model of the Macro Economy

The Monetary and Financial System

Macroeconomic Policy I: Monetary Policy

Macroeconomic Policy II: Fiscal Policy

International Trade and Finance

Filters

Normative economics deals with _ and positive economics deals with _.