Question 1

What is the term for the beginning point of a graph (the 0,0 point) ?

Accepted Answer

A)   the basis point
B)   variable one
C)   the origin
D)   the quadrantE) C) and D)
F) B) and C)

Question 2

What does "ceteris paribus" mean?

Accepted Answer

A)   If events A and B occur together, one must cause the other.
B)   Other things are held constant.
C)   What is True for the individual must be True for the whole.
D)   All relevant details are included.E) B) and C)
F) All of the above

Question 3

Why is economics different from a "hard" science like physics?

Accepted Answer

A)   Economists cannot easily control all the variables that might influence human behaviour.
B)   Economists have to control fewer variables than what is found in a physics experiment.
C)   Economic experiments are easier to conduct than those in physics.
D)   Economists abstract from reality in creating their theories.E) A) and B)
F) A) and C)

Question 4

Which of the following graphs or charts must add up to 100 percent?

Accepted Answer

A)   a labour graph
B)   a time-series graph
C)   a bar graph
D)   a pie chartE) A) and C)
F) None of the above

Question 5

One topic that microeconomics explores is how prices are determined in individual markets, while macroeconomics is concerned with issues such as the economy's overall rate of inflation, economic growth and unemployment.

Accepted Answer

A) True 
 B)False

Question 6

What is the term for the branch of economics that focuses on outcomes in highly aggregated markets, such as the markets for labour or consumer products?

Accepted Answer

A)   normative economics
B)   macroeconomics
C)   Marxian economics
D)   positive economicsE) None of the above
F) A) and D)

Question 7

Rational individuals act to advance their own self-interest; therefore, charitable giving must constitute irrational behaviour.

Accepted Answer

A) True 
 B)False

Question 8

What question is economics fundamentally concerned with?

Accepted Answer

A)   How can limited wants be used to satisfy limited resources?
B)   How are limited resources allocated to satisfy unlimited wants?
C)   How are scarce resources allocated to satisfy limited wants?
D)   How are limited resources allocated to satisfy scarce wants?E) A) and B)
F) A) and C)

Question 9

Which of the following is an example of a capital resource?

Accepted Answer

A)   yellow-fin tuna
B)   an unskilled worker
C)   a large coal deposit
D)   a fishing boatE) B) and D)
F) All of the above

Question 10

Which of the following is NOT a reason that economists use theories?

Accepted Answer

A)   to explain and help predict human behaviour
B)   to understand economic behaviour
C)   to develop a testable hypothesis
D)   to abstract from the complexities of the worldE) C) and D)
F) A) and B)

Question 11

Which of the following best demonstrates marginal thinking?

Accepted Answer

A)   measuring all of the costs of a meal against all of the benefits when deciding whether to order a second milkshake
B)   choosing to spend one more hour studying economics because you think the improvement in your score on the next quiz will be worth the sacrifice of time
C)   acquiring the information relevant to a choice before making that choice
D)   deciding to never purchase a coat made with animal skins or fursE) A) and C)
F) All of the above

Question 12

"If I didn't have class tonight, I would save the $4 campus parking fee and spend four hours at work where I earn $10 per hour." What is the opportunity cost of attending class tonight?

Accepted Answer

A)   $0
B)   $4
C)   $40
D)   $44E) All of the above
F) A) and D)

Question 13

A country has a comparative advantage in the production of DVD players if it can produce DVD players at a lower opportunity cost than others.

Accepted Answer

A) True 
 B)False

Question 14

If race-car driving is dangerous, why would any rational person choose to be a race-car driver?

Accepted Answer

A rational person might choose...

Question 15

In order for a student to acquire an education, many resources are required. Which of the following might be categorized as capital resources?

Accepted Answer

A)   the work effort of registrars, clerical assistants, and teaching assistants
B)   chalkboards, overhead projectors, and the expertise of professors
C)   water, trees, and the acreage a campus rests on
D)   exams, natural gas (which heats the buildings) , and electricityE) B) and C)
F) A) and D)

Question 16

Lance's boss offers him twice his usual wage rate to work tonight instead of taking his girlfriend on a romantic date. Which of the following is the likely outcome of this offer?

Accepted Answer

A)   It will decrease the opportunity cost of going on the date, since Lance really needs the money.
B)   It will increase the opportunity cost of going on the date.
C)   It will not affect the opportunity cost of going on the date.
D)   It will reduce the opportunity cost of going on the date because giving up the additional work dollars will make his girlfriend feel even more appreciated.E) All of the above
F) C) and D)

Question 17

The marginal cost of a vacation in Jamaica is $3500. According to the rule of rational choice, if the marginal benefit to Colby of a vacation in Jamaica is $3000, what will he do?

Accepted Answer

A)   Colby will experience a net gain of $500 if he vacations in Jamaica.
B)   Colby will choose not to vacation in Jamaica at this time.
C)   Colby will borrow $500 and vacation in Jamaica.
D)   Colby will experience a net gain of $3000 if he vacations in Jamaica.E) A) and B)
F) C) and D)

Question 18

If incentives matter, then policies can be used to discourage undesirable behaviour. Which of the following policies would NOT likely help protect wildlife?

Accepted Answer

A)   a reduction in the number of park rangers and law enforcement personnel
B)   jail sentences for camping or littering in protected areas
C)   fines on hunting
D)   the provision of additional rangers and law enforcement personnelE) A) and B)
F) A) and D)

Question 19

If individuals who sit in the back of the classroom receive lower grades on average than the rest of the class, does that mean that sitting in the back of a classroom causes one to perform poorly on exams?

Accepted Answer

A)   The reoccurrence of such a relationship is sufficient evidence that sitting in the back of a classroom will lead to lower grades.
B)   It is not possible for an economist to determine causation between variables.
C)   The reoccurrence of a certain relationship between two variables does not necessarily imply causation.
D)   The reoccurrence of such a relationship is sufficient evidence that students who receive low grades prefer to keep a low profile and always sit in the back of the classroom.E) None of the above
F) A) and B)

Question 20

When does an individual have a comparative advantage in production?

Accepted Answer

A)   when they are more self-sufficient than others
B)   when they can produce at the highest opportunity cost
C)   when they can produce at the lowest opportunity cost
D)   when they are less self-sufficient than othersE) All of the above
F) C) and D)

Exam 1: The Role and Method of Economics

Which of the following is NOT a reason that economists use theories?

Correct AnswerverifiedShow Answer

If individuals who sit in the back of the classroom receive lower grades on average than the rest of the class, does that mean that sitting in the back of a classroom causes one to perform poorly on exams?

Correct AnswerverifiedShow Answer

Which of the following graphs or charts must add up to 100 percent?

Correct AnswerverifiedShow Answer

A country has a comparative advantage in the production of DVD players if it can produce DVD players at a lower opportunity cost than others.

Correct AnswerverifiedShow Answer

Why is economics different from a "hard" science like physics?

Correct AnswerverifiedShow Answer

"If I didn't have class tonight, I would save the $4 campus parking fee and spend four hours at work where I earn $10 per hour." What is the opportunity cost of attending class tonight?

Correct AnswerverifiedShow Answer

In order for a student to acquire an education, many resources are required. Which of the following might be categorized as capital resources?

Correct AnswerverifiedShow Answer

Lance's boss offers him twice his usual wage rate to work tonight instead of taking his girlfriend on a romantic date. Which of the following is the likely outcome of this offer?

Correct AnswerverifiedShow Answer

One topic that microeconomics explores is how prices are determined in individual markets, while macroeconomics is concerned with issues such as the economy's overall rate of inflation, economic growth and unemployment.

Correct AnswerverifiedShow Answer

Rational individuals act to advance their own self-interest; therefore, charitable giving must constitute irrational behaviour.

Correct AnswerverifiedShow Answer

If incentives matter, then policies can be used to discourage undesirable behaviour. Which of the following policies would NOT likely help protect wildlife?

Correct AnswerverifiedShow Answer

Which of the following is an example of a capital resource?

Correct AnswerverifiedShow Answer

When does an individual have a comparative advantage in production?

Correct AnswerverifiedShow Answer

What does "ceteris paribus" mean?

Correct AnswerverifiedShow Answer

What question is economics fundamentally concerned with?

Correct AnswerverifiedShow Answer

Which of the following best demonstrates marginal thinking?

Correct AnswerverifiedShow Answer

The marginal cost of a vacation in Jamaica is $3500. According to the rule of rational choice, if the marginal benefit to Colby of a vacation in Jamaica is $3000, what will he do?

Correct AnswerverifiedShow Answer

What is the term for the branch of economics that focuses on outcomes in highly aggregated markets, such as the markets for labour or consumer products?

Correct AnswerverifiedShow Answer

If race-car driving is dangerous, why would any rational person choose to be a race-car driver?

Correct AnswerverifiedA rational person might choose...View AnswerShow Answer

What is the term for the beginning point of a graph (the 0,0 point) ?

Correct AnswerverifiedShow Answer

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A rational person might choose...
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