Question 1

When an electricity distribution company decides to use manpower to bury its lines, it directly answers the ________ question.

Accepted Answer

The decision to use manpower to bury lines answers the "how" question, as it pertains to the method or process of burying the lines. The "for whom" question relates to the target audience or beneficiaries, the "what" question pertains to the specific solution, the "why" question relates to the reasons or justifications for the decision, and the "when" question pertains to the timing or schedule.

Question 2

Which of the following is a microeconomic issue?

Accepted Answer

The price of petrol increasing in the United States is a microeconomic issue as it pertains to the specific market for gasoline in the U.S. It is not a macroeconomic issue related to the overall economy.

Question 3

Which economic question depends on the incomes that people earn and the prices they pay for goods and services?

Accepted Answer

The question "For whom?" in economics pertains to the distribution of goods and services among different groups of people. Incomes affect the ability of individuals or households to purchase these goods and services, while prices determine how much they can afford. Therefore, the economic question that depends on incomes and prices is "For whom?"

Question 4

Which of the following is a macroeconomic topic?
i. China increases interest rates to slow its economic growth.
ii. Parliament lowers tax rates to try to lower the unemployment rate.
iii. Nissan decides to produce more electric Leaf models and fewer Altima sedans.

Accepted Answer

Macroeconomics deals with economy-wide phenomena, such as changes in interest rates and unemployment rates. Both i (interest rate adjustments by a country) and ii (government tax policy to influence unemployment) are macroeconomic topics. iii (a company's production decision) is a microeconomic topic, focusing on individual or company-level decisions.

Question 5

Which of the following BEST describes macroeconomics?

Accepted Answer

Macroeconomics is the study of the overall performance and behavior of the economy as a whole, rather than individual markets or industries. It looks at the aggregate effects of the choices made by individuals, firms, and governments on the national economy, such as inflation, unemployment, and economic growth.

Question 6

Which of the following is a microeconomic topic?
i. K-Mart's decision to close stores that are not making a profit.
ii. Bunning's choice to hire more full-time employees because its sales increased.
iii. Virgin Airlines changes its fares.

Accepted Answer

All three scenarios involve individual firms making decisions based on their own economic circumstances, which is a focus of microeconomics.

Question 7

Which of the following is a topic studied in macroeconomics?

Accepted Answer

Macroeconomics deals with the performance, structure, and behavior of the entire economy, rather than individual markets or industries. The effect of government policy, such as raising taxes, on economic growth is a topic studied in macroeconomics. The other choices are topics studied in microeconomics, which focuses on individual markets and industries.

Question 8

When Tesla decides to increase production of electric cars, it directly answers the ________ question.

Accepted Answer

Increasing production of electric cars directly answers the "what" question in economics, which pertains to what goods and services are to be produced.

Question 9

When a home builder decides to computerise all of his production schedule, it directly answers the ________ question.

Accepted Answer

Computerising the production schedule is a means of improving efficiency and streamlining the production process, which speaks directly to the "how" question of how to achieve these goals.

Question 10

Which of the following is the best example of a 'what?' question?

Accepted Answer

The answer of Which of the following is the best...

Question 11

When an AFL player earns more than a police officer, society answers the ________ question.

Accepted Answer

The "for whom" question in economics refers to who benefits or receives the goods and services produced in an economy. When an AFL player earns more than a police officer, it reflects societal values and decisions regarding for whom resources and rewards are allocated.

Question 12

The question of 'What goods and services get produced?' most closely relates to which of the following issues?

Accepted Answer

The question of "What goods and services get produced?" is related to the issue of allocation of resources and what priorities society sets for production. Building a missile defense system or putting a computer in every primary school classroom are examples of goods and services that could potentially be prioritized based on societal preferences.

Question 13

Scarcity exists because:

Accepted Answer

Scarcity exists because human wants and needs are unlimited whereas the resources available to satisfy them are limited. As a result, individuals and societies have to make choices about how to allocate these resources, which leads to the concept of trade-offs and opportunity costs.

Question 14

Which of the following statements best describes the study of economics?

Accepted Answer

Economics is the study of how people, firms, and societies allocate scarce resources to satisfy their unlimited wants. This involves making choices, since we have limited resources and must decide how to allocate them. Therefore, option D is the best choice as it captures the essence of economics.

Question 15

Which of the following is a microeconomic issue?

Accepted Answer

The quantity of wheat grown in South Australia increasing is a microeconomic issue as it relates to the production and supply of a specific good in a particular region. The other options are macroeconomic issues as they deal with broader economic issues such as national tax policy, inflation, overall economic growth, and government spending affecting the entire economy.

Question 16

Economics is best defined as the social science that studies

Accepted Answer

Economics is the study of how societies allocate scarce resources. This includes the choices made by individuals, businesses, and governments in terms of what goods and services to produce, how to produce them, and for whom to produce them. The study of economics also encompasses the analysis of economic systems, economic behavior, and decision-making, as well as how markets and prices work.

Question 17

Scarcity forces people to:

Accepted Answer

Scarcity means that resources are limited and cannot fulfill all our wants and needs. Therefore, people have to choose among the available alternatives to allocate those resources efficiently. This leads to the concept of opportunity cost, where choosing one alternative means giving up the opportunity to choose another.

Question 18

Because human wants are insatiable and unlimited while available resources are limited, people are said to face the problem of

Accepted Answer

The problem described in the statement is the problem of scarcity, which occurs because resources are limited while human wants are insatiable and unlimited.

Question 19

Scarcity requires that we

Accepted Answer

Scarcity refers to the limited availability of resources in comparison to the unlimited wants and needs of individuals and society as a whole. Therefore, we must make choices about what goods and services to produce with the limited resources available. This is the central concept of economics and is known as the problem of scarcity.

Question 20

The primary focus of microeconomics is

Accepted Answer

Microeconomics focuses on the behavior and operation of individual units or sectors in the economy, such as households, firms, and markets. It analyzes how these units make decisions, interact with each other, and allocate scarce resources. It is not concerned with the overall performance of the entire economy, levels of employment or inflation, government policies, or the elimination of scarcity.

Quiz 1: Getting Started

When an electricity distribution company decides to use manpower to bury its lines, it directly answers the ________ question.

Which of the following is a microeconomic issue?

Which economic question depends on the incomes that people earn and the prices they pay for goods and services?

Which of the following is a macroeconomic topic? i. China increases interest rates to slow its economic growth. ii. Parliament lowers tax rates to try to lower the unemployment rate. iii. Nissan decides to produce more electric Leaf models and fewer Altima sedans.

Which of the following BEST describes macroeconomics?

Which of the following is a microeconomic topic? i. K-Mart's decision to close stores that are not making a profit. ii. Bunning's choice to hire more full-time employees because its sales increased. iii. Virgin Airlines changes its fares.

Which of the following is a topic studied in macroeconomics?

When Tesla decides to increase production of electric cars, it directly answers the ________ question.

When a home builder decides to computerise all of his production schedule, it directly answers the ________ question.

Which of the following is the best example of a 'what?' question?

When an AFL player earns more than a police officer, society answers the ________ question.

The question of 'What goods and services get produced?' most closely relates to which of the following issues?

Scarcity exists because:

Which of the following statements best describes the study of economics?

Which of the following is a microeconomic issue?

Economics is best defined as the social science that studies

Scarcity forces people to:

Because human wants are insatiable and unlimited while available resources are limited, people are said to face the problem of

Scarcity requires that we

The primary focus of microeconomics is