Question 1

When a student is thinking at the margin,he analyzes how many more points he would get on his economics final exam if he devotes one more hour for studying.

Accepted Answer

Thinking at the margin involves analyzing the costs and benefits of adding one more unit of something. In this case, the student is analyzing the benefit of devoting one more hour for studying (one more unit) in terms of how many more points he would get on his final exam (the benefit).

Question 2

In the Application,which of the following increased the incentive to buy hybrid vehicles?
A)Purchases of hybrid vehicles qualified for a $3400 subsidy from the federal government.
B)Oil prices decreased.
C)Hybrid vehicles were more expensive than regular vehicles.
D)Hybrid vehicles had similar emissions as the non-hybrid vehicles.

Accepted Answer

The qualification for a $3400 subsidy from the federal government increased the incentive to buy hybrid vehicles as it lowered the overall cost of buying one, making it more affordable for consumers.

Question 3

The reason why spammers find it profitable to spam is because:
A)it does not cost the spammer anything to send a million emails.
B)it does not cost the spammer anything to receive a million emails.
C)it does not benefit the spammer anything to send a million emails.
D)it does not cost nor benefit the spammer anything to send a million emails.

Accepted Answer

Spammers find it profitable to spam because it does not cost them anything to send a million emails. They can send bulk emails without incurring any significant expenses. They can use free email services and spamming software to reach millions of people at once. Therefore, the cost of spamming is negligible compared to the potential profits they can earn by tricking people into clicking on malicious links or buying products from fraudulent websites.

Question 4

Economists assume that individuals make informed decisions and act in their own self-interest.

Accepted Answer

This assumption is a fundamental principle in economics and underlies many economic theories and models. However, it is important to note that individuals may not always have perfect information or may not act completely rationally in their self-interest.

Question 5

The example about London's congestion problem illustrates which of the following economic ways of thinking?
A)isolate variables-ceteris paribus
B)use of assumptions to simplify
C)thinking at the margin
D)all of the above

Accepted Answer

The example about London's congestion problem uses all three economic ways of thinking. It isolates variables (ceteris paribus) by considering the impact of adding an additional toll on congestion, assuming that other factors (such as public transportation options) remain the same. It also uses assumptions to simplify the analysis, such as assuming that drivers will choose the most efficient route and that toll money will be used to improve public transportation. Finally, it involves thinking at the margin by examining how an additional toll will impact congestion and revenue at the margin (i.e. for each additional driver).

Question 6

A key assumption of most economic analysis is that people act rationally and in their own self-interest.

Accepted Answer

This assumption is a basic principle of traditional neoclassical economics. However, some behavioral economists challenge the assumption and argue that people do not always act rationally or in their own self-interest.

Question 7

According to the Application,giving subsidies for the purchase of hybrid vehicles was the most efficient way for the government to reduce CO2 emissions.

Accepted Answer

The statement is subjective and context-dependent; the efficiency of subsidies for hybrid vehicles in reducing CO2 emissions can vary based on factors like the energy mix, vehicle adoption rates, and alternative policies.

Question 8

What did Adam Smith mean when he wrote that individuals rationally act in their own self-interest?

Accepted Answer

The answer of What did Adam Smith mean when he...

Question 9

The reason why economists do not need details regarding the topography of a region when determining driving directions is because the topography is irrelevant to complete your objective of getting to a certain place.

Accepted Answer

Economists are focused on the overall economic trends and principles, which do not rely on specifics like topography for determining driving directions.

Question 10

An example of analysis that involves variables and how they affect one another would include the relationship of the price of CDs to the quantity of CDs purchased.

Accepted Answer

The price of CDs and the quantity of CDs purchased are two variables that are likely to have an inverse relationship. As the price of CDs increases, the quantity of CDs purchased is likely to decrease and vice versa. This type of analysis involves examining the relationship between two or more variables and how they affect one another.

Question 11

Macroeconomics is best described as the study of:
A)very large issues.
B)the choices made by individual households,firms,and governments.
C)the nation's economy as a whole.
D)the relationship between inflation and wage inequality.

Accepted Answer

Macroeconomics is the study of the nation's economy as a whole, including issues such as inflation, unemployment, economic growth, and monetary and fiscal policies. It focuses on the big picture concerns that affect the entire economy, rather than on the choices made by individual households, firms, or governments.

Question 12

The reason why economists do not need details regarding the topography of a region when determining driving directions is because economics is because economics desires unrealistic assumptions.

Accepted Answer

The statement is incorrect. Economists do not need details regarding the topography of a region when determining driving directions because it is not relevant to their analysis, not because they desire unrealistic assumptions. Economists make assumptions to simplify their models, but these assumptions are based on realistic factors that are relevant to their analysis.

Question 13

According to the book,what are the four elements of economic thinking?

Accepted Answer

The answer of According to the book,what are the four...

Question 14

In the Application,which of the following is NOT a way to reduce CO2 emissions in a country?
A)Improved building insulation.
B)Deforestations
C)Using energy efficient lighting
D)Using hybrid vehicles.

Accepted Answer

Deforestation actually contributes to CO2 emissions, as trees absorb CO2 during photosynthesis. The other options listed all involve reducing energy consumption or switching to cleaner energy sources, which ultimately lead to decreased CO2 emissions.

Question 15

In the Application,which of the following decreased the incentive to buy hybrid vehicles?
A)Purchases of hybrid vehicles qualified for a $3400 subsidy from the federal government.
B)Oil prices increased.
C)Hybrid vehicles were more expensive than regular vehicles.
D)Hybrid vehicles had lower emissions than the non-hybrid vehicles.

Accepted Answer

Hybrid vehicles being more expensive than regular vehicles decreases the incentive to buy them, as the higher upfront cost can deter potential buyers despite other benefits.

Question 16

Unrealistic simplifying assumptions should be avoided because they cause the analysis that is based on the assumption to be incorrect.

Accepted Answer

The answer of Unrealistic simplifying assumptions should be avoided because...

Question 17

Which of the following is a macroeconomic question?
A)Will a constitutional amendment to balance the federal budget lead to good economic policy?
B)Should a firm decide to enter a particular market?
C)Should the government prevent the merger of two large firms?
D)All of the above are macroeconomic questions.

Accepted Answer

The question about a constitutional amendment to balance the federal budget pertains to the overall health of the economy and represents a macroeconomic question. The other options pertain to individual businesses or specific market considerations, which are microeconomic questions.

Question 18

According to the application,one economic solution to spam is to:
A)subsidize spammers.
B)charge a $0.01 electronic stamp for each commercial email message.
C)outlaw the use of the Internet.
D)require Internet service providers to sue spammers.

Accepted Answer

Charging a small fee for each commercial email message would deter spammers from sending large quantities of unsolicited emails, as it would become more costly for them to do so. This economic solution could also provide revenue for email providers and filter out low-quality spam messages. The other options, such as subsidizing spammers or outlawing the use of the internet, are not viable solutions. Requiring internet service providers to sue spammers would also not be effective as it would be difficult to enforce and would not address the root of the problem.

Question 19

Ceteris paribus means "Let the buyer beware."

Accepted Answer

Ceteris paribus actually means "all other things being equal." It is used in economics and other fields to isolate the effect of one variable while holding all other variables constant. "Let the buyer beware" is a different phrase, known as caveat emptor.

Question 20

Using assumptions to make things simpler and focus attention on what really matters is like using a road map to plan a trip.

Accepted Answer

Just like how a road map helps to simplify and focus attention on the important aspects of a trip by providing a guide, assumptions help simplify complex problems by providing a starting point for analysis and decision-making.

Quiz 1: Introduction: What Is Economics

When a student is thinking at the margin,he analyzes how many more points he would get on his economics final exam if he devotes one more hour for studying.

In the Application,which of the following increased the incentive to buy hybrid vehicles?

The reason why spammers find it profitable to spam is because:

Economists assume that individuals make informed decisions and act in their own self-interest.

The example about London's congestion problem illustrates which of the following economic ways of thinking?

A key assumption of most economic analysis is that people act rationally and in their own self-interest.

According to the Application,giving subsidies for the purchase of hybrid vehicles was the most efficient way for the government to reduce CO2 emissions.

What did Adam Smith mean when he wrote that individuals rationally act in their own self-interest?

The reason why economists do not need details regarding the topography of a region when determining driving directions is because the topography is irrelevant to complete your objective of getting to a certain place.

An example of analysis that involves variables and how they affect one another would include the relationship of the price of CDs to the quantity of CDs purchased.

Macroeconomics is best described as the study of:

The reason why economists do not need details regarding the topography of a region when determining driving directions is because economics is because economics desires unrealistic assumptions.

According to the book,what are the four elements of economic thinking?

In the Application,which of the following is NOT a way to reduce CO2 emissions in a country?

In the Application,which of the following decreased the incentive to buy hybrid vehicles?

Unrealistic simplifying assumptions should be avoided because they cause the analysis that is based on the assumption to be incorrect.

Which of the following is a macroeconomic question?

According to the application,one economic solution to spam is to:

Ceteris paribus means "Let the buyer beware."

Using assumptions to make things simpler and focus attention on what really matters is like using a road map to plan a trip.