Question 1

Opportunity cost is the expected value of the alternative not chosen.

Accepted Answer

A) True 
 B)False

Question 2

A free good is:

Accepted Answer

A)   also a scarce good.
B)   a relatively abundant good.
C)   a good with no opportunity cost.
D)   a good with relatively low opportunity cost.E) B) and C)
F) A) and B)

Question 3

Statements that make value judgments are:

Accepted Answer

A)   pecuniary.
B)   positive.
C)   nominal.
D)   normative.E) None of the above
F) C) and D)

Question 4

The Case in Point on "baldness and heart disease" suggests that by preventing baldness:

Accepted Answer

A)   men can reduce the likelihood they will develop colon cancer.
B)   men are unlikely to influence their chances of having heart problems.
C)   men are likely to reduce their chances of having heart problems.
D)   men can live longer.E) None of the above
F) A) and B)

Question 5

Explain the following statement: "In economics there are few absolute solutions. Almost all problem solutions require tradeoffs."

Accepted Answer

In economics, it is rare to find absolut...

Question 6

A variable that induces a change in another variable is a(n) :

Accepted Answer

A)   dependent variable.
B)   independent variable.
C)   codependent variable.
D)   constant variable.E) None of the above
F) All of the above

Question 7

The problem of determining what goods and services society should produce:

Accepted Answer

A)   exists because we can produce more than we need or want.
B)   exists because there are not enough resources to provide all the goods and services that people want to purchase.
C)   would not exist if all goods and services were scarce.
D)   would not exist if government owned all of the resources.E) None of the above
F) B) and D)

Question 8

Unemployment and inflation are:

Accepted Answer

A)   not relevant in the U.S. economy today.
B)   major topics in macroeconomics.
C)   unique only to capitalistic economies.
D)   very important in the study of microeconomics.E) All of the above
F) A) and B)

Question 9

Ceteris paribus means:

Accepted Answer

A)   allowing all other things to change.
B)   making value judgments.
C)   all other things unchanged.
D)   differentiating between macroeconomics and microeconomics.E) A) and B)
F) B) and C)

Question 10

The use of controlled experiments using particular substances to test hypotheses is most likely to be found in:

Accepted Answer

A)   chemistry.
B)   economics.
C)   history.
D)   the humanities.E) A) and D)
F) A) and C)

Question 11

The problem of scarcity is confronted by:

Accepted Answer

A)   industrialized societies.
B)   pre-industrialized societies.
C)   societies governed by communist philosophies.
D)   all societies.E) B) and D)
F) None of the above

Question 12

The problem of determining how goods and services should be produced exists because:

Accepted Answer

A)   we do not have enough skilled workers relative to the number of unskilled workers.
B)   we do not have enough unskilled workers relative to the number of skilled workers.
C)   corporations want to avoid changing their methods of production.
D)   most goods can be produced with different combinations of resources.E) B) and C)
F) All of the above

Question 13

The three fundamental economic questions are what, how, and why.

Accepted Answer

A) True 
 B)False

Question 14

A basic assumption used in many economic models is:

Accepted Answer

A)   as price goes up, the amount purchased will go up too.
B)   as price goes up, less will be offered for sale on the market.
C)   if the underlying theory doesn't represent reality, it is not useful.
D)   ceteris paribus, which means all other things remain unchanged.E) C) and D)
F) B) and D)

Question 15

The economic way of thinking has to do with:

Accepted Answer

A)   analyzing benefits but not costs.
B)   analyzing costs but not benefits.
C)   making choices at the margin.
D)   making the distinction between microeconomics and macroeconomics.E) None of the above
F) All of the above

Question 16

Explain how and why the concept of "all other things unchanged" is so important in the study of economics.

Accepted Answer

The concept of "all other things unchang...

Question 17

The existence of alternative uses for a resource implies it isn't scarce.

Accepted Answer

A) True 
 B)False

Question 18

The scientific method is more difficult for economists than, say, chemists, because:

Accepted Answer

A)   controlled laboratory conditions are more problematic in economics.
B)   it is difficult to hold other factors that may affect the variables being studied constant in economics.
C)   economic conditions may change quickly and unexpectedly.
D)   all of the above.E) C) and D)
F) B) and C)

Question 19

A theory or model is a simplification of reality, in much the same way that a road map shows only those features needed to get from one point to another.

Accepted Answer

A) True 
 B)False

Question 20

The concept of scarcity indicates that:

Accepted Answer

A)   most goods have no alternative uses.
B)   almost all goods have alternative uses.
C)   most decisions can be made without sacrificing alternatives.
D)   certain societies are able to overcome the constraints imposed by alternative uses of resources.E) A) and B)
F) B) and C)

Exam 1: Welcome to Economics

The three fundamental economic questions are what, how, and why.

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Explain the following statement: "In economics there are few absolute solutions. Almost all problem solutions require tradeoffs."

Correct AnswerAnswered by ExamLex AIIn economics, it is rare to find absolut...View AnswerShow Answer

The problem of determining how goods and services should be produced exists because:

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A basic assumption used in many economic models is:

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Ceteris paribus means:

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The existence of alternative uses for a resource implies it isn't scarce.

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The problem of determining what goods and services society should produce:

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The economic way of thinking has to do with:

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Statements that make value judgments are:

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The use of controlled experiments using particular substances to test hypotheses is most likely to be found in:

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The scientific method is more difficult for economists than, say, chemists, because:

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A variable that induces a change in another variable is a(n) :

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Opportunity cost is the expected value of the alternative not chosen.

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Explain how and why the concept of "all other things unchanged" is so important in the study of economics.

Correct AnswerAnswered by ExamLex AIThe concept of "all other things unchang...View AnswerShow Answer

The problem of scarcity is confronted by:

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A free good is:

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A theory or model is a simplification of reality, in much the same way that a road map shows only those features needed to get from one point to another.

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The concept of scarcity indicates that:

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The Case in Point on "baldness and heart disease" suggests that by preventing baldness:

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Unemployment and inflation are:

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In economics, it is rare to find absolut...
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Correct Answer
Answered by ExamLex AI
The concept of "all other things unchang...
View Answer

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