Question 1

How are changes in opportunity cost predicted to affect behavior?

Accepted Answer

The higher the opportunity cost of doing something, the less likely an individual is to do it because they are giving up more to engage in that activity. Conversely, the lower the opportunity cost, the more likely they are to do it because they are sacrificing less. Choices B and C accurately reflect this relationship.

Question 2

Saying "the marginal costs are greater than the marginal benefits" is the same as saying

Accepted Answer

Marginal cost refers to the additional cost incurred for producing one more unit while marginal benefit refers to the additional benefit gained from consuming one more unit. If the marginal costs are greater than the marginal benefits, it means that the additional cost of producing one more unit outweighs the additional benefit gained from consuming it. Therefore, option D, which states that the additional costs are greater than the additional benefits, is the best choice.

Question 3

In general,there is a ______________ relationship between the number of hours spent studying for a test and the grade earned on the test.

Accepted Answer

There is a direct relationship between the number of hours spent studying and the grade earned, meaning that as the number of hours spent studying increases, the grade earned on the test also increases.

Question 4

Which of the following statements is true?

Accepted Answer

Oil is a natural resource and is classified under the resource category of land.

Question 5

Variables X and Y are independent of each other.If we plot X on the horizontal axis and Y on the vertical axis,the line that connects combinations of X and Y in a two-variable diagram is

Accepted Answer

Since X and Y are independent of each other, the value of one variable has no effect on the value of the other variable. This means that any combination of X and Y is possible and there is no relationship between them. Therefore, the line that connects combinations of X and Y is horizontal (parallel to the X-axis) and vertical (parallel to the Y-axis) at the same time, which is encompassed by choices A and C. Hence, the correct answer is option E (a or c).

Question 6

Which of the following statements is false?

Accepted Answer

Labor includes both the physical and mental talents of people that contribute to the production process, not just the physical.

Question 7

Variables A and B are directly related.If we plot A on the horizontal axis and B on the vertical axis,the line that connects combinations of A and B in a two-variable diagram is

Accepted Answer

Since A and B are directly related, as A increases, B will also increase. This means that the line connecting the combinations of A and B will slope upward (left to right), as shown in a positive linear relationship. Therefore, the best choice is D.

Question 8

Which of the following is least likely to be an effect of scarcity?

Accepted Answer

Utility is a measure of satisfaction or happiness that individuals derive from consuming goods and services. It is not directly related to scarcity, though it can be influenced by scarcity if a good becomes more valuable to individuals due to its limited availability. The other options (A, B, C, and D) are all related to scarcity and would likely be effects of scarcity. A rationing device would be put in place to allocate a scarce resource, choice arises due to scarcity of resources, opportunity cost is the cost of choosing one option over another due to limited resources, and dollar price can increase due to scarcity.

Question 9

The coordinates of point A are 20 units of X and 40 units of Y.The coordinates of point B are 22 units of X and 30 units of Y.With X on the horizontal axis and Y on the vertical axis,the slope of the line between points A and B is

Accepted Answer

The answer of The coordinates of point A are 20...

Question 10

A line is parallel to the vertical axis.The slope of the line is

Accepted Answer

A line parallel to the vertical axis has no horizontal change, only vertical change. This means that the line has an undefined slope, or a slope of infinity.

Question 11

Deciding at the margin is __________ an all-or-nothing decision.

Accepted Answer

Deciding at the margin involves making decisions based on small changes or increments, rather than making an all-or-nothing decision.

Question 12

Which of the following statements is false?

Accepted Answer

The statement "Positive and normative economics both address what should be" is false. Positive economics deals with what is and normative economics deals with what should be.

Question 13

A line is parallel to the horizontal axis.The slope of the line is

Accepted Answer

A line parallel to the horizontal axis has a slope of zero, because it doesn't rise or fall as it moves from left to right. The slope of a line represents the rate of change between two variables, so a slope of zero means that there is no change in the y variable for any change in the x variable.

Question 14

Variable X rises as a result of variable Y rising.Variables X and Y are

Accepted Answer

When two variables rise together or fall together, they are said to be directly related. Therefore, choice B is correct.

Question 15

Is it possible for mandatory seatbelt laws to increase vehicle fatalities?

Accepted Answer

While mandatory seatbelt laws have been shown to decrease the number of deaths per accident, it is possible that the increase in accident rates due to drivers feeling safer or more reckless with seatbelts on could outweigh the decrease in deaths per accident. Therefore, it's possible for mandatory seatbelt laws to increase vehicle fatalities in this scenario.

Question 16

What does it mean if a person makes a "decision at the margin"?

Accepted Answer

Making a decision at the margin means comparing the additional benefits and additional costs of an action to determine if it is worth taking. This is an important concept in economics and helps individuals and organizations to make rational decisions based on a cost-benefit analysis.

Question 17

Variables A and B are inversely related.If we plot A on the horizontal axis and B on the vertical axis,the line that connects combinations of A and B in a two-variable diagram is

Accepted Answer

When two variables are inversely related, an increase in one variable leads to a decrease in the other variable. This means that as we move along the horizontal axis (increase in A), we will move downward on the vertical axis (decrease in B). Therefore, the line connecting the combinations of A and B will be downward-sloping (left to right).

Question 18

In most societies,dollar price acts as the main rationing device.If dollar price weren't the main rationing device,would there still be a need for some rationing device to take its place?

Accepted Answer

Regardless of the method of allocation, scarcity will always exist due to limited resources and unlimited wants. Therefore, there will always be a need for some form of rationing device. The dollar price is just one way to allocate goods and services in a market economy.

Question 19

Which of the following is a positive economic statement?

Accepted Answer

Positive economic statements are objective and fact-based, whereas normative statements are subjective and value-based. Choice B, stating a fact about consumer behavior, and choice C, stating a fact about the budget deficit, are both examples of positive economic statements. Choices A and D express what ought to be done, making them normative statements.

Question 20

Which of the following is an unintended effect of placing safety caps on medicines?

Accepted Answer

Placing safety caps on medicines can lead to people leaving their medicine containers open more often, which can make it easier for children to get into the medicine. This is an unintended effect of the safety caps. Option A is incorrect because although it may be harder for some people to open the containers, the intention is to prevent children from accessing the medicine. Option C is incorrect because there is no evidence to suggest that safety caps directly impact the number of people getting sick or needing medicine. Option D is incorrect because there is no direct correlation between safety caps and medicine prices.

Quiz 1: What Economics Is About

How are changes in opportunity cost predicted to affect behavior?

Saying "the marginal costs are greater than the marginal benefits" is the same as saying

In general,there is a ______________ relationship between the number of hours spent studying for a test and the grade earned on the test.

Which of the following statements is true?

Variables X and Y are independent of each other.If we plot X on the horizontal axis and Y on the vertical axis,the line that connects combinations of X and Y in a two-variable diagram is

Which of the following statements is false?

Variables A and B are directly related.If we plot A on the horizontal axis and B on the vertical axis,the line that connects combinations of A and B in a two-variable diagram is

Which of the following is least likely to be an effect of scarcity?

The coordinates of point A are 20 units of X and 40 units of Y.The coordinates of point B are 22 units of X and 30 units of Y.With X on the horizontal axis and Y on the vertical axis,the slope of the line between points A and B is

A line is parallel to the vertical axis.The slope of the line is

Deciding at the margin is __________ an all-or-nothing decision.

Which of the following statements is false?

A line is parallel to the horizontal axis.The slope of the line is

Variable X rises as a result of variable Y rising.Variables X and Y are

Is it possible for mandatory seatbelt laws to increase vehicle fatalities?

What does it mean if a person makes a "decision at the margin"?

Variables A and B are inversely related.If we plot A on the horizontal axis and B on the vertical axis,the line that connects combinations of A and B in a two-variable diagram is

In most societies,dollar price acts as the main rationing device.If dollar price weren't the main rationing device,would there still be a need for some rationing device to take its place?

Which of the following is a positive economic statement?

Which of the following is an unintended effect of placing safety caps on medicines?