Macroeconomics Chapter 1—The Economic Approach (A GUARANTEED)
MULTIPLEiCHOICE
1. Whatidoieconomistsimeaniwhenithey istate ithatia igoodiisiscarce?
a. There iisia ishortage ioriinsufficientisupplyiofithe igoodiat ithe
...
Macroeconomics Chapter 1—The Economic Approach (A GUARANTEED)
MULTIPLEiCHOICE
1. Whatidoieconomistsimeaniwhenithey istate ithatia igoodiisiscarce?
a. There iisia ishortage ioriinsufficientisupplyiofithe igoodiat ithe iexistingiprice.
b. Itiisiimpossible ito iexpandithe iavailabilityiofithe igoodibeyond ithe icurrentiamount.
c. Peopleiwill iwantito ibuyimore iofithe igoodiregardlessiofithe iprice iofithe igood.
d. The iamountiofithe igoodithatipeople iwould ilike iexceedsithe isupplyifreely iavailable ifrom
inature.
ANS: D PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iScarcity, itradeoffs, iand iopportunity icost TOP: WhatiisiEconomicsiAbout?
KEY: Bloom's:iComprehension MSC: SuggestediQuiz
2. Economicichoice iandicompetitive ibehavioriare ithe iresultiof
a. basic ihumanigreed.
b. poverty.
c. private iownership iofiresources.
d. scarcity.
ANS: D PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iScarcity, itradeoffs, iand iopportunity icost TOP: WhatiisiEconomicsiAbout?
KEY: Bloom's:iComprehension MSC: SuggestediQuiz
3. Joeiand iEdigo ito ia idinerithatisellsihamburgersifori$5iand ihotidogsifori$3. iTheyiagree itoisplitithe ilunch
ibillievenly. iEdichoosesia ihotidog. iThe imarginalicost ito iJoeitheniofiordering ia ihamburgeriinstead iofia
ihotidogiis
a. $1.
b. $2.
c. $2.50.
d. $3.
ANS: A PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iMarginal icostsi&ibenefits TOP: The iEconomic iWayiofiThinking
KEY: Bloom's:iApplication MSC: SuggestediQuiz
4. The iexpression, i"There'sinoisuchithing iasia ifree ilunch," iimpliesithat
a. everyone ihasitoipayiforihisiownilunch.
b. the ipersoniconsumingia igoodimustialwaysipayiforiit.
c. opportunityicostsiare iincurred iwheniresourcesiare iuseditoiproduce igoodsiand iservices.
d. noione ihasitime iforia igoodilunchianymore.
ANS: C PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iScarcity, itradeoffs, iand iopportunityicost
TOP: The iEconomic iWayiofiThinking KEY: Bloom's:iComprehension
MSC: SuggestediQuiz
5. Whichione iofithe ifollowingistatesia icentral ielementiofithe ieconomic iwayiofithinking?
a. Scarce igoodsiare ipriceless.
b. Incentivesimatter--humanichoice iisiinfluenced iinipredictable iwaysibyichangesiinipersonal
icostsiand ibenefits.
c. The irealismiofithe iassumptionsiisithe ibestitestiofianieconomic itheory.
d. When idecidingihowito iallocate itime, ithe iconceptiofiopportunity icostiisimeaningless.ANS: B PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iThe irole iofiincentives TOP: The iEconomic iWayiofiThinking
KEY: Bloom's:iComprehension MSC: SuggestediQuiz
6. Whichiofithe ifollowingiisimosticlearlyiconsistentiwithithe ibasic ipostulate iofieconomicsiregardingithe
ireactioniofipeople ito ia ichange iin iincentives.
a. Farmersiproduce ifeweribushelsiofiwheatiiniresponse ito ianiincrease iinithe iprice iofiwheat.
b. Peopleiwill ibuyimore imilk iatia iprice iofi$2iperigallon ithan iati$1 iperigallon.
c. Peopleiwill ibuyilessigasiifithe iprice iofigasiincreasesibyi$.20iperigallon.
d. Peopleiwill iconsume imore ibeefiifithe iprice iincreasesifromi$1ito i$2iperipound.
ANS: C PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iThe irole iofiincentives TOP: The iEconomic iWayiofiThinking
KEY: Bloom's:iApplication MSC: SuggestediQuiz
7. Whichione iofithe ifollowingiisia ipositive ieconomicistatement?
a. Aniincrease iinithe iminimumiwage iwillireduce iemployment.
b. The iminimumiwage ishould ibe iincreased.
c. Social ijustice iwillibe iserved ibyiincreasingithe iminimumiwage.
d. Thoughtful ipeopleiopposeian iincrease iinithe iminimumiwage.
ANS: A PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iScarcity, itradeoffs, iand iopportunity icost
TOP: Positive iand iNormative iEconomics KEY: Bloom's:iComprehension
MSC: SuggestediQuiz
8. The ibasic idifference ibetweenimacroeconomicsiandimicroeconomicsiisithat
a. macroeconomicsiisiconcerned iwithithe iforest i(aggregate imarkets), iwhile imicroeconomics
iisiconcerned iwithithe iindividual itreesi(subcomponents).
b. macroeconomicsiisiconcerned iwithipolicyidecisions, iwhile imicroeconomicsiappliesionly
ito itheory.
c. microeconomicsiisiconcerned iwithithe iforest i(aggregate imarkets), iwhile imacroeconomics
iisiconcerned iwithithe itreesi(subcomponents).
d. opportunityicost iisiapplicable ito imacroeconomics, iandithe ifallacy ioficompositionirelatesito
imicroeconomics.
ANS: A PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iScarcity, itradeoffs, iand iopportunity icost
TOP: Pitfallsito iAvoid iin iEconomic iThinking KEY: Bloom's:iComprehension
MSC: SuggestediQuiz
9. Economicianalysisiassumesithat
a. individualsiactionlyioutiofiselfishimotives.
b. although iindividualsiare iat itimesiselfish iandiatitimesiunselfish, ionlyitheiriselfishiactions
imayibe ipredicted.
c. peopleiare ibasicallyihumanitarian, iand itheiriactionsiare, itherefore, iimpossible ito ipredict.
d. changesiinithe ipersonalibenefitsiand icostsiassociated iwithia ichoice iwilliexertia ipredictable
iinfluence ionihumanibehavior.
ANS: D PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iUtility iandiconsumerichoice TOP: WhatiisiEconomicsiAbout?
KEY: Bloom's:iComprehension MSC: SuggestediQuiz10. While iwaiting iin iline ito ibuy itwo itacosiat i75icentsieach, iand ia imediumidrink ifori80icents, iJordan
inoticesithat ithe irestaurantihasia ivalue imeal icontainingithree itacosiandia imediumidrinkiallifori$2.50.
iForiJordan, ithe imarginalicostiofipurchasing ithe ithird itacoiwould ibe
a. zero.
b. 20icents.
c. 75icents.
d. 80icents.
ANS: B PTS: 1 DIF: Moderate NAT: BUSPROG:iAnalytic
STA: DISC:iMarginal icostsi&ibenefits TOP: The iEconomic iWayiofiThinking
KEY: Bloom's:iApplication MSC: SuggestediQuiz
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