Chapter 1: Getting Started

If the president of Columbia commented that "we should do something to reduce inflation in Columbia," this would be an example of:

A normative statement

The pace of globalization has accelerated in recent years largely because of ____.

Advances in communication technology

A reward or penalty that encourages or discourages a specific behavior or action is known as ___.

An incentive

The "all things equal" assumption is known as:

Ceteris Paribus

When two values tend to move together in a predictable manner it is known as ___.

Correlation

According to the rationality assumption, people:

Do not intentionally make decisions that would leave them worse off.

Understanding economics can help policymakers devise strategies to do all of the following except:

Eliminate climate change

One of the first steps in deciding whether to complete your education is to:

Evaluate the marginal cost and marginal benefit of that decision

The social security time bomb refers to the:

Future inability of the U.S. government to fully fund SSI

Tangible products like cars and televisions are referred to as ___.

Goods

The decision to raise taxes is an example of which type of economic policy?

Government

Macroeconomics can be used to understand all of the topics listed below except:

How a consumer decides between the purchase of two different cars

Economic decisions are made at every level in society. When we try to decide which production method to use among several alternatives, which of the following key economic questions are we trying to answer?

How do we produce the products?

Which of the following is a positive economic statement?

If minimum wage rates rise, then unemployment will rise

When a person makes choices that are best for them they are said to be acting ___.

In their own self-interest

Economics:

Is concerned with how people respond to incentives

Which of the following are not essential components of an economic model?

Normative statements

Macroeconomics is concerned with all of the following except:

Political party affiliation

The principle of opportunity cost evolves from the concept of:

Scarcity

Economics models are:

Simplifications of reality that focus only on key relationships and ignore less relevant details

The marginal benefit you receive from eating a third slice of pizza will be ___ the marginal benefit you receive from eating the first slice of pizza.

Smaller than

Choices that are best for society as a whole are considered to be in the:

Social Interest

Which of the following is not a possible cost of attending college?

The cost of housing

When you make choices you are picking from a slate of available options so the choice yo make is essentially a ___.

Tradeoff