Question

1.The most comprehensive measure of the size of an economy is called

a) GDP.b) health care.c) inflation.d) the overall price level.e) economic well-being.

Answer

The most comprehensive measure of the size of an economy is called

a) GDP. (Correct)b) health care.c) inflation.d) the overall price level.e) economic well-being.

Question

2.Controlled experiments area) seldom used in economics because

economists do not like to repeat experiments.b) often used because controlling other factors

is relatively easy in economics.c) not used as widely in economics as in other

disciplines.d) is the method used when comparing the

economic experience of other countries.e) performed by the government to collect

economic data.

Answer

Controlled experiments area) seldom used in economics because

economists do not like to repeat experiments.b) often used because controlling other factors

is relatively easy in economics.c) not used as widely in economics as in other

disciplines. (Correct)d) is the method used when comparing the

economic experience of other countries.e) performed by the government to collect

economic data.

Question

3.When the price of gasoline is observed to increase while the oil remains unchanged, then

a) Oil and gasoline prices are positively correlated.b) Oil and gasoline prices are negatively correlated.c) Gasoline prices cause the oil prices to increase.d) Oil prices cause the gasoline prices to increase.e) Oil prices cannot be the cause of the change in

the price of gasoline during the period examined.

Answer

When the price of gasoline is observed to increase while the oil remains unchanged, then

a) Oil and gasoline prices are positively correlated.b) Oil and gasoline prices are negatively correlated.c) Gasoline prices cause the oil prices to increase.d) Oil prices cause the gasoline prices to increase.e) Oil prices cannot be the cause of the change in

the price of gasoline during the period examined. (Correct)

Question

4.Economic modelsa) are not complicated because the behavior

they describe is not complicated.b) require either algebra or graphs.c) are complicated because human behavior is

complicated.d) are simplifications of the phenomena they

attempt to explain.e) would not be needed if controlled

experiments were used more often.

Answer

Economic modelsa) are not complicated because the behavior

they describe is not complicated.b) require either algebra or graphs.c) are complicated because human behavior is

complicated.d) are simplifications of the phenomena they

attempt to explain. (Correct)e) would not be needed if controlled

experiments were used more often.

Question

5.If the quantity demanded of coffee increases when the price of coffee declines, then these two _________ are _________.

a) variables; negatively related b) constants; positively relatedc) variables; positively relatedd) constants; negatively relatede) variables; not related

Answer

If the quantity demanded of coffee increases when the price of coffee declines, then these two _________ are _________.

a) variables; negatively related (Correct)b) constants; positively relatedc) variables; positively relatedd) constants; negatively relatede) variables; not related

Question

6.The “ceretis paribus” assumption is used in economics

a) because economic theory is an accurate reflection of the real world.

b) to isolate the important variables when formulating a theory.

c) primarily to identify unstable equilibrium situations.

d) to make the theory more complicated.e) to distinguish economics from other

disciplines.

Answer

The “ceretis paribus” assumption is used in economics

a) because economic theory is an accurate reflection of the real world.

b) to isolate the important variables when formulating a theory. (Correct)

c) primarily to identify unstable equilibrium situations.

d) to make the theory more complicated.e) to distinguish economics from other

disciplines.

Question

7.Which of the following is more of a microeconomic concept than a macroeconomic concept?

a) Concern over simultaneous high rates of inflation and unemployment

b) Price determination in a resourcemarket

c) The rate of economic growthd) Concern over an entire economy’s balance of

paymentse) How the composition of output is determined in

an economy

Answer

Which of the following is more of a microeconomic concept than a macroeconomic concept?

a) Concern over simultaneous high rates of inflation and unemployment

b) Price determination in a resourcemarket (Correct)

c) The rate of economic growthd) Concern over an entire economy’s balance of

paymentse) How the composition of output is determined

in an economy

Question

8.Those who support a laissez faire systema) argue for a French-style economy.b) argue for a market economy.c) support government intervention.d) argue for a command economy.e) argue for a mixed economy.

Answer

Those who support a laissez faire systema) argue for a French-style economy.b) argue for a market economy. (Correct)c) support government intervention.d) argue for a command economy.e) argue for a mixed economy.

Question

9.A newspaper editorial advocating higher income tax rates as the way to reduce the budget deficit is an example of

a) ceteris paribus.b) microeconomics.c) functional economics.d) positive economics.e) normative economics.

Answer

A newspaper editorial advocating higher income tax rates as the way to reduce the budget deficit is an example of

a) ceteris paribus.b) microeconomics.c) functional economics.d) positive economics.e) normative economics. (Correct)

Question

10.Because economists have varying moral beliefs and different views of the world

a) it is impossible for there to be anything scientific about economics.

b) they will disagree on abstract issues.c) there are many different types of economic

theories. d) they will agree more often than not on principles

when discussed on an abstract level, but will disagree on whether to apply these principles in real-world circumstances.

e) economics can never be a science.

Answer

Because economists have varying moral beliefs and different views of the world

a) it is impossible for there to be anything scientific about economics.

b) they will disagree on abstract issues.c) there are many different types of economic

theories. (Correct) d) they will agree more often than not on principles

when discussed on an abstract level, but will disagree on whether to apply these principles in real-world circumstances.

e) economics can never be a science.

11.Which of the following pairs of variables usually exhibit a positive correlation?

a) Income and spendingb) Weight and caloric intakec) Fertilizer use and corn yieldd) Years of education and salarye) All of the above usually exhibit

a positive correlation.

Question

Which of the following pairs of variables usually exhibit a positive correlation?

a) Income and spendingb) Weight and caloric intakec) Fertilizer use and corn yieldd) Years of education and salarye) All of the above usually exhibit

a positive correlation. (Correct)

Answer