Question 1

A curve with a positive but decreasing slope represents a relationship where, every time the variable measured along the horizontal axis increases by one unit, the variable measured along the vertical axis
A)increases by a constant amount.
B)does not change by much.
C)increases by a decreasing amount.
D)decreases.
E)increases by an increasing amount.

Accepted Answer

A positive but decreasing slope indicates that the rate of increase is slowing down, meaning the vertical variable increases by a decreasing amount as the horizontal variable increases.

Question 2

A graph shows the price of a pound of cucumbers on the vertical axis and the quantity of new cars sold by Honda on the horizontal axis. The price of a pound of cucumbers remains constant as the quantity of new cars sold increases. The graph of these data is a
A)horizontal line.
B)positively sloped line.
C)negatively sloped line.
D)curve with a maximum.
E)vertical line.

Accepted Answer

The price of cucumbers remains constant regardless of the quantity of cars sold, indicating no relationship between the two variables, resulting in a horizontal line.

Question 3

A choice made by comparing all relevant alternatives systematically and incrementally is
A)a sunk cost.
B)a choice made in the social interest.
C)an opportunity cost.
D)a choice on the margin.
E)a benefit.

Accepted Answer

A choice on the margin involves comparing the additional benefits and costs of a decision incrementally, considering the next unit of change.

Question 4

As part of its proposal to win the 2012 Olympics, London developed a carbon offset plan to reduce the Games' impact on the environment. In 2011, the organizers decided to drop this plan to reduce emissions. We can conclude that
A)there are no incentives to reduce carbon emissions.
B)the organizers are not making a rational decision.
C)the organizers are ignoring a sunk cost.
D)it is difficult to calculate the cost of reducing emissions.
E)the marginal cost of reducing emissions exceeded the marginal benefits of reducing emissions.

Accepted Answer

The decision to drop the carbon offset plan suggests that the organizers determined the marginal cost of reducing emissions was greater than the marginal benefits, making it an economically rational decision.

Question 5

To show the values of an economic variable for different groups in a population at a point in time, it is best to use a
A)trend-section diagram.
B)time-series graph.
C)linear graph.
D)scatter diagram.
E)cross-section graph

Accepted Answer

A cross-section graph is used to display data for different groups at a single point in time, making it suitable for showing the values of an economic variable across various groups.

Question 6

Macroeconomics is the study of A)national or global economies. B)how ceteris paribus affects causation. C)the actions of individual consumers. D)the government. E)the actions of individual businesses.

Accepted Answer

Macroeconomics focuses on the performance, structure, and behavior of national or global economies as a whole, rather than individual markets.

Question 7

In the above figure, no relationship between x and y is shown in Figure
A)A.
B)B.
C)C.
D)D.
E)A and Figure B.

Accepted Answer

The answer of 
In the above figure, no relationship between...

Question 8

A scatter diagram can be used to see
A)the value of a variable for different groups in a population.
B)whether a variable is positively or negatively related to itself.
C)if the value of a variable is rising or falling.
D)how a variable behaves over time.
E)if a relationship exists between two variables.

Accepted Answer

A scatter diagram is used to visualize the relationship between two variables, helping to identify any correlation or pattern between them.

Question 9

Of the three major economic questions, which of the following is the best example of a "How?" question?
A)Should we produce more heavy fleece coats?
B)Should we spend more on health care?
C)Should we collect tolls on turnpikes using human toll collectors or mechanized toll machines?
D)Should we eat more oatmeal?
E)Should we build log homes or build factories from bricks?

Accepted Answer

The "How?" question in economics refers to the method of production or the process of delivering a service. Option C addresses the method of collecting tolls, which involves choosing between human labor and mechanization, thus exemplifying a "How?" question.

Question 10

The value of the best thing that a person must give up when making a decision is known as the _{--------------------}cost. A)direct B)sunk C)benefit's D)explicit E)opportunity

Accepted Answer

The opportunity cost is the value of the best alternative that must be given up when making a decision.

Question 11

The figure above shows the relationship between the price of a dozen roses and the quantity of roses a florist can sell. The slope between points A and B is
A)2.
B)20.
C)16.
D)4
E)nonexistent because at point A, no roses are sold.

Accepted Answer

The answer of 
The figure above shows the relationship between...

Question 12

The graph shows
A)a cross-section relationship.
B)a relationship with a maximum.
C)no relationship.
D)a relationship with a minimum.
E)a relationship that becomes less steep.

Accepted Answer

The answer of 
The graph shows
A)a cross-section relationship.
B)a relationship with...

Question 13

In the above figure, the diagram shows
A)a two-variable scatter diagram.
B)a scatter diagram.
C)a cross-section graph between x and time.
D)a downward trend in x.
E)an upward trend in x.

Accepted Answer

The answer of 
In the above figure, the diagram shows
A)a...

Question 14

Which type of economic graph reveals trends in data?
A)scatter diagram
B)time-series graph
C)cross-section graph
D)Answers A and C are correct.
E)Answers A, B, and C are all correct.

Accepted Answer

A time-series graph reveals trends in data over a period of time, showing how variables change at different points in time.

Question 15

Suppose you take a trip during Spring Break. To determine the benefit of taking the trip, you
A)measure what you are willing to give up to take the trip.
B)calculate the opportunity cost of the trip.
C)calculate the value of the next best alternative foregone.
D)must measure what the trip is worth to you and then subtract the cost of the trip.
E)determine the sunk cost of taking the trip.

Accepted Answer

The answer of Suppose you take a trip during Spring...

Question 16

When two variables in a graph are related to a third, changing the third causes
A)a movement along the curve.
B)no change in the curve because the third variable isn't on the axes.
C)a shift of the curve.
D)either a shift or a movement in the curve but more information is needed to determine which occurs.
E)None of the above answers is correct.

Accepted Answer

When a third variable, not on the axes, changes, it typically causes a shift of the curve, as it affects the relationship between the two variables on the axes.

Question 17

As a person increases his or her caloric intake, the person's weight increases, ceteris paribus. The relationship between the person's caloric intake and the person's weight is an example of A)a positive relationship. B)a trended relationship. C)a single point on a graph. D)unrelated variables. E)a negative relationship.

Accepted Answer

A positive relationship means that as one variable increases, the other variable also increases. In this case, as caloric intake increases, weight also increases, assuming all other factors remain constant (ceteris paribus).

Question 18

Economics is best defined as the social science that studies
A)the way to eliminate choices in our decisions.
B)how a person can get everything he or she wants.
C)the choices that societies, and the people and institutions that make up societies, make in dealing with the issue of scarcity.
D)how choices made in the social interest must conflict with choices made in the self-interest.
E)the reason money exists.

Accepted Answer

Economics is the study of how societies allocate scarce resources to meet the needs and wants of individuals and institutions, focusing on the choices made due to scarcity.

Question 19

Demonstrating how an economic variable changes from one year to the next is best illustrated by a
A)Venn diagram.
B)linear graph.
C)cross-section graph.
D)scatter diagram.
E)time-series graph.

Accepted Answer

A time-series graph is used to display data points at successive time intervals, showing how an economic variable changes over time.

Question 20

Mothers Against Drunk Drivers (MADD)campaigned to increase the legal penalties of drunk driving. This successful campaign_{--------------------} of drunk driving. A)decreased the marginal cost B)decreased the marginal benefit C)increased the marginal cost D)increased the marginal benefit E)had no effect on the marginal cost or marginal benefit but did affect the total benefit

Accepted Answer

The campaign increased the legal penalties, which raised the marginal cost of drunk driving by making it more costly in terms of legal consequences.

Quiz 1: Getting Started

A curve with a positive but decreasing slope represents a relationship where, every time the variable measured along the horizontal axis increases by one unit, the variable measured along the vertical axis

A graph shows the price of a pound of cucumbers on the vertical axis and the quantity of new cars sold by Honda on the horizontal axis. The price of a pound of cucumbers remains constant as the quantity of new cars sold increases. The graph of these data is a

A choice made by comparing all relevant alternatives systematically and incrementally is

As part of its proposal to win the 2012 Olympics, London developed a carbon offset plan to reduce the Games' impact on the environment. In 2011, the organizers decided to drop this plan to reduce emissions. We can conclude that

To show the values of an economic variable for different groups in a population at a point in time, it is best to use a

Macroeconomics is the study of

In the above figure, no relationship between x and y is shown in Figure

A scatter diagram can be used to see

Of the three major economic questions, which of the following is the best example of a "How?" question?

The value of the best thing that a person must give up when making a decision is known as the _{--------------------}cost.

The figure above shows the relationship between the price of a dozen roses and the quantity of roses a florist can sell. The slope between points A and B is

The graph shows

In the above figure, the diagram shows

Which type of economic graph reveals trends in data?

Suppose you take a trip during Spring Break. To determine the benefit of taking the trip, you

When two variables in a graph are related to a third, changing the third causes

As a person increases his or her caloric intake, the person's weight increases, ceteris paribus. The relationship between the person's caloric intake and the person's weight is an example of

Economics is best defined as the social science that studies

Demonstrating how an economic variable changes from one year to the next is best illustrated by a

Mothers Against Drunk Drivers (MADD) campaigned to increase the legal penalties of drunk driving. This successful campaign_{--------------------} of drunk driving.