Question 1

Scarcity means

Accepted Answer

A)   wants are greater than the limited resources available to satisfy these wants.
B)   wants are less than the limited resources available to satisfy these wants.
C)   resources are infinite.
D)   wants are limited.
E)   both c and d

Question 2

Economists use the ceteris paribus assumption primarily in order to

Accepted Answer

A)   make their analyses easier for them to conduct.
B)   designate what they believe is the correct relationship between two variables.
C)   explain why people sometimes consume more of a good when its price rises.
D)   explain why those things that come first do not necessarily cause those things that come later.
E)   designate the difference between normative and positive economics.

Question 3

What is the difference between macroeconomics and microeconomics? Give an example of a question that a macroeconomist might be interested in answering,then do the same for a microeconomist.

Accepted Answer

Macroeconomics is the branch of economic...

Question 4

The headline in the newspaper reads "County Supervisors Debate Building New Schools." The headline relates closest to which economic concept?

Accepted Answer

A)   goods and bads
B)   utility
C)   choice
D)   efficiency

Question 5

The question of how a tax change might impact U.S.economic output is most closely associated with the study of

Accepted Answer

A)   microeconomics.
B)   managerial economics.
C)   macroeconomics.
D)   consumer economics.

Question 6

Prior to attending college,Darius is offered a lucrative four-year contract as an actor in a daytime soap opera.Assuming that acting and attending college are Darius' preferred alternatives and that he must choose between the two,his cost of attending college after receiving the offer

Accepted Answer

A)   increases.
B)   decreases.
C)   stays the same.
D)   increases or stays the same depending on whether he accepts the offer.

Question 7

Which of the following statements is false?

Accepted Answer

A)   Microeconomics is the branch of economics that deals with human behavior and choices as they relate to relatively small units-an individual, a firm, an industry, and a single market.
B)   Macroeconomics is the branch of economics that deals with human behavior and choices as they relate to highly aggregate markets.
C)   Positive economics attempts to determine what is.
D)   Normative economics addresses what should be.
E)   Positive and normative economics both address what should be.

Question 8

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.

Question 9

The condition in an economy that makes a "rationing device" a necessity is the fact that

Accepted Answer

A)   the economy is organized around free markets.
B)   the economy is centrally planned by the government.
C)   scarcity exists.
D)   there are fewer types of goods than there are people in the economy.

Question 10

Economists use the terms resource and input as synonyms.

Accepted Answer

A) True 
 B)False

Question 11

In economics,a synonym for utility is

Accepted Answer

A)   usefulness.
B)   satisfaction.
C)   sacrifice.
D)   a service.

Question 12

A mandatory seatbelt law ends up raising the number of traffic fatalities if it lowers fatalities per accident from 0.12 to 0.08 while raising the number of accidents per period from 400,000 to any more than

Accepted Answer

A)   480,000.
B)   600,000.
C)   660,000.
D)   770,000.

Question 13

In all cases,microeconomics deals with

Accepted Answer

A)   what is.
B)   what should be.
C)   relatively small units in the economy.
D)   the entire economy.

Question 14

Define the term rationing device and give an example 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 15

If variable X rises as variable Y falls,then X and Y have an inverse relationship.

Accepted Answer

A) True 
 B)False

Question 16

Explain what an economist means by the phrase "decisions made at the margin." Cite an example to support your answer.

Accepted Answer

When making a decision at the margin an ...

Question 17

Explain how scarcity can exist in a relatively rich country such as the United States. Give examples to help support your answer.

Accepted Answer

Even in a wealthy country,the people liv...

Question 18

It usually takes less time to buy a six-pack of 7-Up,a loaf of bread,and a half-gallon of ice cream at a small convenience store (such as a 7-Eleven) than at a large,full-service grocery store.Which of the following persons is most likely to buy these items at a convenience store?

Accepted Answer

A)   a person with high opportunity cost of time
B)   a person with low opportunity cost of time
C)   a person who is out of work
D)   There is not enough information to answer the question.

Question 19

Normative economics is concerned with

Accepted Answer

A)   value judgments.
B)   opinions.
C)   cause-effect relationships.
D)   observations that can be proved.
E)   both a and b

Question 20

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

Exam 1: What Economics Is About

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

Correct AnswerverifiedA rationing device is a mechanism used t...View AnswerShow Answer

In economics,a synonym for utility is

Correct AnswerverifiedShow Answer

A mandatory seatbelt law ends up raising the number of traffic fatalities if it lowers fatalities per accident from 0.12 to 0.08 while raising the number of accidents per period from 400,000 to any more than

Correct AnswerverifiedShow Answer

Economists use the terms resource and input as synonyms.

Correct AnswerverifiedShow Answer

Prior to attending college,Darius is offered a lucrative four-year contract as an actor in a daytime soap opera.Assuming that acting and attending college are Darius' preferred alternatives and that he must choose between the two,his cost of attending college after receiving the offer

Correct AnswerverifiedShow Answer

Scarcity means

Correct AnswerverifiedShow Answer

Normative economics is concerned with

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The headline in the newspaper reads "County Supervisors Debate Building New Schools." The headline relates closest to which economic concept?

Correct AnswerverifiedShow Answer

In all cases,microeconomics deals with

Correct AnswerverifiedShow Answer

The condition in an economy that makes a "rationing device" a necessity is the fact that

Correct AnswerverifiedShow Answer

If variable X rises as variable Y falls,then X and Y have an inverse relationship.

Correct AnswerverifiedShow Answer

It usually takes less time to buy a six-pack of 7-Up,a loaf of bread,and a half-gallon of ice cream at a small convenience store (such as a 7-Eleven) than at a large,full-service grocery store.Which of the following persons is most likely to buy these items at a convenience store?

Correct AnswerverifiedShow Answer

Explain how scarcity can exist in a relatively rich country such as the United States. Give examples to help support your answer.

Correct AnswerverifiedEven in a wealthy country,the people liv...View AnswerShow Answer

Economists use the ceteris paribus assumption primarily in order to

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The question of how a tax change might impact U.S.economic output is most closely associated with the study of

Correct AnswerverifiedShow Answer

Explain what an economist means by the phrase "decisions made at the margin." Cite an example to support your answer.

Correct AnswerverifiedWhen making a decision at the margin an ...View AnswerShow Answer

Which of the following statements is false?

Correct AnswerverifiedShow Answer

What is the difference between macroeconomics and microeconomics? Give an example of a question that a macroeconomist might be interested in answering,then do the same for a microeconomist.

Correct AnswerverifiedMacroeconomics is the branch of economic...View AnswerShow Answer

Correct Answer
verified
A rationing device is a mechanism used t...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Even in a wealthy country,the people liv...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
When making a decision at the margin an ...
View Answer

Correct Answer
verified

Correct Answer
verified
Macroeconomics is the branch of economic...
View Answer