Question 1

The respective payments for the resources of natural resources,labor,capital,and entrepreneurial ability are

Accepted Answer

A)   interest,wages,profit,and rent
B)   profit,rent,interest,and wages
C)   rent,wages,profit,and interest
D)   interest,profit,wages,and rent
E)   rent,wages,interest,and profitF) B) and E)
G) C) and E)

Question 2

Choices made by economic decision makers

Accepted Answer

A)   are government decisions only
B)   are the primary focus of economics
C)   are not important in economic analysis
D)   occur infrequently
E)   do not involve ordinary citizensF) C) and E)
G) C) and D)

Question 3

Which of the following would an economist classify as capital?

Accepted Answer

A)   100 shares of Microsoft stock
B)   a $50 bill
C)   a credit card
D)   a lawyer's personal computer
E)   a bauxite mine in JamaicaF) A) and C)
G) A) and B)

Question 4

A rational decision maker compares the expected marginal cost to the expected marginal benefit of any activity.

Accepted Answer

A) True 
 B)False

Question 5

The problem of scarce resources

Accepted Answer

A)   means that in some cities there are not enough jobs
B)   could be solved if the unemployment rate fell
C)   is that there are not enough resources to satisfy people's unlimited wants
D)   is that resources are used inefficiently
E)   can be solved by lowering taxesF) None of the above
G) C) and E)

Question 6

Economists believe that

Accepted Answer

A)   people who choose to promote the interests of others cannot be acting rationally in their own self-interest
B)   people show concern only for those whom they know personally
C)   charitable donations would disappear if tax deductions for charitable giving were eliminated
D)   the notion of self-interest rules out concern for others
E)   concern for the welfare of others is consistent with the concept of self-interestF) B) and E)
G) A) and E)

Question 7

Economic decision makers will continue to acquire information only as long as the expected additional benefit exceeds the expected additional cost of the information.

Accepted Answer

A) True 
 B)False

Question 8

Households

Accepted Answer

A)   own and sell resources
B)   play a very minor role in the economy
C)   supply goods and services
D)   are the largest purchasers of resources
E)   none of the aboveF) A) and C)
G) A) and B)

Question 9

Economists classify all of the following as capital,except one.Which one is not capital?

Accepted Answer

A)   a $20 bill in a firm's petty cash drawer
B)   the building where our economics class meets
C)   a plumber's wrench
D)   a railroad car
E)   a factoryF) A) and B)
G) B) and D)

Question 10

The economic behavior of individual decision makers and the determination of price and output in specific markets are both studied in

Accepted Answer

A)   microeconomics
B)   macroeconomics
C)   positive economics
D)   normative economics
E)   disequilibrium economicsF) B) and C)
G) A) and D)

Question 11

Rational economic decision makers will make a change only if

Accepted Answer

A)   the change is free of risk
B)   there are no costs involved
C)   their expectations are correct
D)   there is no uncertainty about the results of the change
E)   the expected marginal benefit exceeds expected marginal costF) C) and E)
G) C) and D)

Question 12

In economics,marginal means

Accepted Answer

A)   incremental or decremental
B)   unimportant
C)   level or size
D)   a border-line situation
E)   a bad alternativeF) A) and B)
G) A) and C)

Question 13

Which of the four types of decision makers in the U.S.economy plays the largest role?

Accepted Answer

A)   U.S.firms and government because they produce the products that households consume
B)   U.S.households because they supply goods to the product markets and are demanders in resource markets
C)   foreign households,firms,and governments because they greatly outnumber those of the United States
D)   U.S.firms and government because they create employment for domestic households and produce goods and services
E)   U.S.households,as buyers in product markets and sellers in resource marketsF) A) and E)
G) B) and E)

Question 14

Economists believe that individuals respond in a predictable way to changes in costs and benefits.The term that best describes this belief is

Accepted Answer

A)   opportunity cost
B)   demand
C)   supply
D)   scarcity
E)   rational behaviorF) B) and E)
G) None of the above

Question 15

Considering both product markets and resource markets,most economic decision makers participate in the economy as both buyers and sellers.

Accepted Answer

A) True 
 B)False

Question 16

You currently subscribe to two magazines and are trying to decide whether you should subscribe to a third.What should determine your decision,if you are rational?

Accepted Answer

A)   the total cost of the magazines compared to the total satisfaction you would receive
B)   the total amount of satisfaction you would get from the magazines
C)   the enjoyment you would get from the third magazine
D)   the cost of the third magazine,including the time it takes to read it
E)   the cost of the third magazine compared to the additional enjoyment you would get from itF) A) and B)
G) B) and E)

Question 17

A rational individual would make charitable contributions only if such contributions receive favorable tax treatment.

Accepted Answer

A) True 
 B)False

Exam 1: The Art and Science of Economic Analysis

Economists classify all of the following as capital,except one.Which one is not capital?

Correct Answer
verified

Which of the following would an economist classify as capital?

Correct Answer
verified

In economics,marginal means

Correct Answer
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A rational decision maker compares the expected marginal cost to the expected marginal benefit of any activity.

Correct Answer
verified

A rational individual would make charitable contributions only if such contributions receive favorable tax treatment.

Correct Answer
verified

Which of the four types of decision makers in the U.S.economy plays the largest role?

Correct Answer
verified

Choices made by economic decision makers

Correct Answer
verified

The respective payments for the resources of natural resources,labor,capital,and entrepreneurial ability are

Correct Answer
verified

Rational economic decision makers will make a change only if

Correct Answer
verified

Considering both product markets and resource markets,most economic decision makers participate in the economy as both buyers and sellers.

Correct Answer
verified

Households

Correct Answer
verified

The problem of scarce resources

Correct Answer
verified

Economic decision makers will continue to acquire information only as long as the expected additional benefit exceeds the expected additional cost of the information.

Correct Answer
verified

You currently subscribe to two magazines and are trying to decide whether you should subscribe to a third.What should determine your decision,if you are rational?

Correct Answer
verified

Economists believe that

Correct Answer
verified

The economic behavior of individual decision makers and the determination of price and output in specific markets are both studied in

Correct Answer
verified

Economists believe that individuals respond in a predictable way to changes in costs and benefits.The term that best describes this belief is

Correct Answer
verified

Exam 1: The Art and Science of Economic Analysis

Economists classify all of the following as capital,except one.Which one is not capital?

Correct AnswerverifiedShow Answer

Which of the following would an economist classify as capital?

Correct AnswerverifiedShow Answer

In economics,marginal means

Correct AnswerverifiedShow Answer

A rational decision maker compares the expected marginal cost to the expected marginal benefit of any activity.

Correct AnswerverifiedShow Answer

A rational individual would make charitable contributions only if such contributions receive favorable tax treatment.

Correct AnswerverifiedShow Answer

Which of the four types of decision makers in the U.S.economy plays the largest role?

Correct AnswerverifiedShow Answer

Choices made by economic decision makers

Correct AnswerverifiedShow Answer

The respective payments for the resources of natural resources,labor,capital,and entrepreneurial ability are

Correct AnswerverifiedShow Answer

Rational economic decision makers will make a change only if

Correct AnswerverifiedShow Answer

Considering both product markets and resource markets,most economic decision makers participate in the economy as both buyers and sellers.

Correct AnswerverifiedShow Answer

Households

Correct AnswerverifiedShow Answer

The problem of scarce resources

Correct AnswerverifiedShow Answer

Economic decision makers will continue to acquire information only as long as the expected additional benefit exceeds the expected additional cost of the information.

Correct AnswerverifiedShow Answer

You currently subscribe to two magazines and are trying to decide whether you should subscribe to a third.What should determine your decision,if you are rational?

Correct AnswerverifiedShow Answer

Economists believe that

Correct AnswerverifiedShow Answer

The economic behavior of individual decision makers and the determination of price and output in specific markets are both studied in

Correct AnswerverifiedShow Answer

Economists believe that individuals respond in a predictable way to changes in costs and benefits.The term that best describes this belief is

Correct AnswerverifiedShow Answer

Correct Answer
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