Micro-Economy | TestBank [2] Chapter 1

Marginalism is

The process of analyzing the additional or incremental costs or benefits arising from a choice or decision

The reasons to study economics include which of the following

to be an informed voter to learn a way of thinking to understand society and global affairs

The statement ʺthe unemployment rate is 5.1%ʺ is an example of a* A) positive statement. B) value judgement. C) normative statement. D) non-verifiable statement.

A) positive statement.

Economists use the phrase ceteris paribus to express the assumption A) "all else equal." B) "everything affects everything else." C) "scarcity is a fact of life." D) "there is no such thing as a free lunch."

A) "all else equal."

Which of the following is a positive question? A) Will the level of teenage unemployment increase if the minimum wage is increased? B) Should the minimum wage be set at one-half the average manufacturing wage to guarantee individuals a decent standard of living? C) Wouldn't it be more equitable if the minimum wage increased automatically with the cost of living? D) Wouldn't it be better to try to increase people's wages through job-training programs rather than by requiring employers to pay minimum wages?

A) Will the level of teenage unemployment increase if the minimum wage is increased?

The reoccurrence of contagious diseases should be significantly lower in a technically advanced nation such as the United States. This statement is best described as A) a normative statement. B) a positive statement. C) a descriptive economics statement. D) an implication of an efficient market

A) a normative statement. The reoccurrence of contagious diseases should be significantly lower in a technically advanced nation such as the United States. This statement is best described as

Better insurance benefits increase the incentive of some individuals to work. This statement is best described as A) a positive statement. B) an example of the ceteris paribus assumption. C) a normative statement. D) a comparative economics statement.

A) a positive statement.

The amount of education that one has is an important factor in the determination of his or her wage rate. This is best described as A) a positive statement. B) an example of the fallacy of composition. C) a normative statement. D) an example of marginalism.

A) a positive statement.

The Latin phrase economists use that means all else equal is A) ceteris paribus. B) cogito ergo sum. C) carpe diem. D) caveat emptor

A) ceteris paribus.

The four criteria that are frequently used in judging the outcome of economic policy are A) efficiency, equity, stability, and economic growth. B) efficiency, equality, stability, and economic growth. C) efficiency, equality, profitability, and stability. D) efficiency, equity, profitability, and stability

A) efficiency, equity, stability, and economic growth.

The collection and use of data to test economic theories is A) empirical economics. B) descriptive economics. C) normative economics. D) positive economics.

A) empirical economics.

The four criteria that are frequently used in judging the outcome of economic policy are efficiency, stability, economic growth, and..* A) equity. B) equality. C) profitability. D) resolution.

A) equity.

A change in economic output is potentially efficient if the value of the resulting gains ________ the value of the resulting losses* A) exceeds B) is less than C) is equal to D) is unrelated to

A) exceeds

I have lived in a house on the Mississippi River for many years and have never seen a flood. Therefore, there is no reason for anyone to buy flood insurance. This statement is an example of A) fallacy of composition. B) post hoc, ergo propter hoc fallacy. C) fallacy of inductive reasoning. D) ceteris paribus fallacy.

A) fallacy of composition

The belief that what is true for a part is necessarily true for the whole describes the* A) fallacy of composition. B) post hoc, ergo prompter hoc fallacy. C) fallacy of division. D) fallacy of inductive reasoning

A) fallacy of composition.

You know that the school parking lot gets very congested about 8:30 a.m. To avoid this congestion, you start arriving at school at 8:00 a.m. However many other students make the same decision, and now the parking lot becomes very congested at 8:00 a.m. * This is an example of the A) fallacy of composition. B) ceteris paribus fallacy. C) fallacy of division. D) post hoc, ergo prompter hoc fallacy.

A) fallacy of composition.

Research conducted in border states suggests that speaking a second language increases the prospects for employment. Therefore, we should require all citizens to speak a second language. This statement is an example of A) fallacy of composition. B) ceteris paribus fallacy. C) fallacy of inductive reasoning. D) post hoc, ergo prompter hoc fallacy.

A) fallacy of composition. The erroneous belief that what is true for a part is necessarily true for the whole is referred to as the

The erroneous belief that what is true for a part is necessarily true for the whole is referred to as the A) fallacy of composition. B) post hoc, ergo prompter hoc fallacy. C) ceteris paribus fallacy. D) fallacy of inductive reasoning

A) fallacy of composition. The erroneous belief that what is true for a part is necessarily true for the whole is referred to as the

A change in economic output is potentially efficient A) if the value of the resulting gains exceeds the value of the resulting losses. B) if the value of the resulting gains exactly equals the value of the resulting losses. C) only if no one is made worse off. D) if the value of the resulting gains is less than the value of the resulting losses.

A) if the value of the resulting gains exceeds the value of the resulting losses.

If information is less costly and more easily available, then usually this A) makes markets more efficient. B) makes markets less efficient. C) increases profit opportunities. D) increases the opportunity cost of acquiring more information.

A) makes markets more efficient.

A formal statement of a theory is known as a(n) A) model. B) positive statement. C) empirical measure. D) causal statement.

A) model.

Which of the following is NOT one of the three fundamental concepts of economics? A) profit maximization B) marginalism C) opportunity cost D) the working of efficient markets

A) profit maximization

At a NASCAR race, you stand up to see better. Everyone else stands up, as well. This is an example of A) the fallacy of composition. B) the post hoc, ergo prompter hoc fallacy. C) ceteris paribus. D) Ockhamʹs razor.

A) the fallacy of composition.

The mistake of inferring causality from two events happening one after the other is called A) the post hoc, ergo propter hoc fallacy. B) the fallacy of composition. C) Ockham's razor. D) the fallacy of co-dependence.

A) the post hoc, ergo propter hoc fallacy.

Which of the following is the best definition of economics? A) the study of how individuals and societies choose to use the scarce resources that nature and previous generations have provided B) the study of how consumers spend their income C) the study of how business firms decide what inputs to hire and what outputs to produce D) the study of how the federal government allocates tax dollars

A) the study of how individuals and societies choose to use the scarce resources that nature and previous generations have provided

If you can download 10 ring tones for your cell phone for $10 or you could download 11 ring tones for your cell phone for $10.50, then the marginal cost of the eleventh ring tone is A) $0.50. B) $10.00. C) $10.50. D) $20.50

Answer : $0.50 انتبهوا لا تغلطون وتقولون 10.50$ الفرق مب المبلغ الجديد

You have decided that you want to attend a renaissance fair as King Henry VIII. You estimate that it will cost $80 to assemble your costume. After spending $80 on the costume, you realize that the additional pieces you need will cost you $20 more. The marginal cost of completing the costume is

Answer : 20$ على ما اضن المبلغ الاضافي هو المارجينل كوست

Which of the following is an opportunity cost of attending college? A) the cost of your apartment or dorm B) the income you could have earned if you didn't attend college C) the cost of the food that you consume while you are attending college D) the education you gain from attending college

Answer B

Which of the following statements is correct? A) Economics is a natural science. B) In large measure, economics is the study of how people make choices. C) If poverty was eliminated there would be no reason to study economics. D) Economic analysis can be used to explain how societies, but not individuals, make decisions.

Answer B

Normative economics A) is the focus of most modern economic reasoning. B) answers the question ʺWhat ought to be?ʺ C) predicts the consequences of alternative actions. D) answers the question ʺWhat is?ʺ

Answer B B) answers the question ʺWhat ought to be?ʺ

If your tuition is $2,000 this semester, your books cost $400, you can only work 10 rather than 40 hours per week during the 15 weeks you are taking classes and you make $12 per hour, and your room and board is $4,000 this semester, then your opportunity cost of attending college this semester is A) $2,400. B) $2,760. C) $7,800. D) $11,800.

Answer C Opportunity Cost Cost of tuition: $2,000 Cost of books: $400 Lost wages: 15*(40-10)*12=$5,400 (Weeks)x(فرق ساعات العمل)x(الأجر في الساعة) $5,400+$2,000+$400=$7,800 room and board is $4,000 this semester هذي غير داخله مع الفرصة البديلة : لأن سواء قررت ادرس او اشتغل راح اصرف للمعيشة ما اضن يجي بهذي الصعوبة c.c

If your tuition is $20,000 this semester, your books cost $2,000, you can only work 10 rather than 40 hours per week during the 15 weeks you are taking classes and you make $15 per hour, and your room and board is $8,000 this semester, then your opportunity cost of attending college this semester is A) $22,000. B) $22,150. C) $28,750. D) $36,750.

Answer C Opportunity Cost Cost of tuition: $20,000 Cost of books: $2,000 Lost wages: 15*(40-10)*15=$6,750 (Weeks)x(فرق ساعات العمل)x(الأجر في الساعة) $6,750+$20,000+$2,000=$28750 room and board is $8,000 this semester هذي غير داخله مع الفرصة البديلة : لأن سواء قررت ادرس او اشتغل راح اصرف للمعيشة

Costs that cannot be avoided, because they have already been incurred are known as A) differential costs. B) marginal costs. C) opportunity costs. D) sunk costs. ( ما ادري اذا معانا او لا )

Answer D اذا استبعدنا الخيارات بيبقى خيار D

The concept of opportunity cost can be applied to the analysis of ________ decision-making processes. A) only economy-wide B) only global C) only-small-scale D) any

Answer D منطقياً نقدر نستخدمه في كل مكان - الأمثله غير محدودة

Microeconomics is best described as the study of A) the choices made by individual households, firms, and governments B) inflation, unemployment, gross national product, and the nationʹs economy as a whole. C) how markets interact in the aggregate economy. D) marginal changes in the economy.

Answer: A

Opportunity cost is A) what we give up to get something else. B) marginal cost divided by sunk cost. C) the same as real cost. D) all of the above

Answer: A

Which of the following is a macroeconomics question? ما اضن معانا لكن احتياط + سهل عشان تقدر تفرق بينه وبين المايكرو A) Should we have a constitutional amendment to balance the federal budget? B) Why does a firm decide to enter a particular market? C) Should the government prevent the merger of two large firms? D) Should the government put a tax on alcohol in an attempt to reduce highway fatalities?

Answer: A

Which of the following is a microeconomics question? A) Is it sensible for a government to subsidize tobacco production? B) Why do some countries grow faster than others? C) Should Congress and the president take action to reduce global warming? D) Should the government attempt to influence the interest rate to lower inflation?

Answer: A

If you eat at an IAU Restaurant that charges 12 SAR for its all you can eat buffet, then the marginal cost of your third trip to the buffet is A) zero. B) $4. C) $12. D) $36

Answer: A بكل بساطة لأنك انت في كل مرة جالس تدفع نفس المبلغ مافي اي زيادة

The phrase ceteris paribus means A) ʺscarcity is a fact of life.ʺ B) ʺall else equal.ʺ C) ʺthere is no such thing as a free lunch.ʺ D) ʺeverything affects everything else.ʺ

Answer: B

Opportunity cost is A) the additional cost incurred from the consumption of one more unit of output. B) the cost involved when choosing between alternatives. C) the cost of production which cannot be recaptured. D) the total cost incurred from the consumption of additional output.

Answer: B B) the cost involved when choosing between alternatives.

If you own a condo and you decide to lease it to your cousin A) there is no opportunity cost of leasing the condo because you own it. B) there is an opportunity cost of leasing the condo because you could have chosen to live in it. C) there is no opportunity cost of leasing the condo because you collect rent from your cousin. D) the only cost relevant to this decision is the price you paid for the condo.

Answer: B افضل طريقة استبعاد الخيارات

An efficient market is a market A) that deals in unlimited resources. B) in which long-term profits are guaranteed. C) in which profit opportunities are eliminated almost instantaneously. D) in which there are no opportunity costs.

Answer: C

Macroeconomics is best described as the study of ما اضن معانا لكن احتياط + سهل A) very large issues. B) the choices made by individual households, firms, and governments. C) the nationʹs economy as a whole. D) the relationship between inflation and wage inequality

Answer: C

You own The Wedding Crasher on DVD. The opportunity cost of watching this DVD for the fourth time A) is zero, since you own it. B) is one-fourth the cost of the DVD, as this is the fourth time you have watched it. C) is the value of the alternative use of the time you spend watching the DVD. D) must be the same as the opportunity cost of watching it the first time.

Answer: C

The concept of opportunity cost A) is relevant only to economics. B) can be applied to the analysis of any decision-making process. C) applies to consumers but not to firms. D) refers only to actual payments and incomes

B) can be applied to the analysis of any decision-making process.

Which of the following is an example of a positive statement? A) There should be no unemployment in an advanced industrial society. B) Higher prices cause consumers to purchase less. C) Consumption should be distributed fairly in society. D) People should pollute as little as possible.

B) Higher prices cause consumers to purchase less.

The rise of the modern factory system in England during the late eighteenth and early nineteenth centuries is known as the A) Great Migration. B) Industrial Revolution. C) Wealth of Nations. D) Dark Ages

B) Industrial Revolution

Which of the following is an example of a normative statement? A) The unemployment rate is six percent. B) There should be no unemployment in an advanced industrial society. C) Higher prices cause consumers to buy less. D) Equilibrium price implies that quantity demanded equals quantity supplied.

B) There should be no unemployment in an advanced industrial society.

Health insurance should be provided to every citizen in a wealthy nation such as the United States. This statement is best described as A) a positive statement. B) a normative statement. C) a marginal statement. D) an implication of an efficient market.

B) a normative statement.

Normative economics is an approach to economics that A) seeks to understand behavior and the operation of systems without making judgments. B) analyzes outcomes of economic behavior, evaluates them as good or bad, and may prescribe preferred courses of action. C) applies statistical techniques and data to economic problems. D) examines the role of government in the economy.

B) analyzes outcomes of economic behavior, evaluates them as good or bad, and may prescribe preferred courses of action.

Empirical economics refers to the* A) exclusion of irrelevant data when analyzing a model. B) collection and use of data to test economic theories. C) model of economics used prior to the Industrial Revolution. D) belief that what is true for a part is necessarily true for the whole.

B) collection and use of data to test economic theories.

An efficient economy is an economy that produces what ________ demand and does so at the ________ possible cost* A) consumers; highest B) consumers; least C) the government; highest D) the government; least

B) consumers; least

If the slope of a straight line is 4 and if Y (the variable on the vertical axis) decreases by 20, then X (the variable on the horizontal axis) A) increases by 5. B) decreases by 5. C) increases by 80. D) decreases by 80.

B) decreases by 5.

An efficient market is characterized by the fact that profit opportunities are* A) guaranteed to everyone. B) eliminated almost instantaneously. C) only provided to government-subsidized producers. D) available only to the most efficient producers.

B) eliminated almost instantaneously.

Redistribution of income from the rich to the poor is achieved from a tax system that requires taxes to rise with income. Which of the following criteria best explains the goal of this tax system? A) efficiency B) equity C) growth D) stability

B) equity

Rent control laws are imposed when city officials believe landlords have been exploiting tenants. Which of the following criteria are they using to guide their actions? A) efficiency B) equity C) growth D) stability

B) equity

You have noticed that there is an increase in the number of homeless people in your city. At the same time you observe that there are also a number of vacant apartments. You believe that the government could reduce the number of homeless people if landlords were required to rent their apartments for less than they are currently charging. This policy recommendation would be motivated by concerns over A) efficiency. B) equity. C) economic growth. D) stability

B) equity.

Economics is the study of A) how to invest in the stock market. B) how society uses limited resources. C) the role of money in markets. D) how government officials decide which goods and services are produced

B) how society uses limited resources.

An efficient market is a market A) in which everyone always gets what they want. B) in which profit opportunities are eliminated almost instantaneously. C) in which profits are always very high and persistent. D) in which opportunity costs are zero.

B) in which profit opportunities are eliminated almost instantaneously.

The slope of a vertical line is A) zero. B) infinite. C) continually changing. D) negative

B) infinite.

The study of economics A) is a very narrow endeavor. B) is a way of analyzing decision-making processes caused by scarcity. C) is concerned with proving that capitalism is better than socialism. D) focuses on how a business should function.

B) is a way of analyzing decision-making processes caused by scarcity.

The study of how benefits are determined for city employees would be considered A) microeconomics. B) macroeconomics. C) descriptive economics. D) institutional economics

B) macroeconomics.

Studying how Joshua allocates his time between school and video games is an example of A) macroeconomics. B) microeconomics. C) industrial organization. D) descriptive economics.

B) microeconomics.

The statement ʺpeople should pollute as little as possibleʺ * is an example of a A) positive statement. B) normative statement. C) factual statement. D) non-judgmental statement.

B) normative statement.

Scarce resources give rise to the concept of A) efficient markets. B) opportunity costs. C) laissez-faire. D) positive economics

B) opportunity costs.

There is great concern over the fact that millions of Americans do not have health insurance. A study of the costs and benefits of implementing a national health-insurance program is an example of A) laissez-faire economics. B) positive economics. C) labor economics. D) normative economics.

B) positive economics.

The unemployment rate was falling during all of the years that I was a student, but as soon as I graduated, the unemployment rate started to rise. Therefore, the job market was waiting until I started looking for employment to start to go bad. This statement is an example of A) fallacy of composition. B) post hoc, ergo prompter hoc fallacy. C) ceteris paribus fallacy. D) fallacy of inductive reasoning

B) post hoc, ergo prompter hoc fallacy.

Whenever a former governor is elected president, the unemployment rate decreases; whenever a former congressman is elected president, the inflation rate increases. This statement is an example of A) fallacy of composition. B) post hoc, ergo prompter hoc fallacy. C) ceteris paribus fallacy. D) fallacy of inductive reasoning.

B) post hoc, ergo prompter hoc fallacy. A common error made in thinking about causation If Event A happens before Event B, it is not necessarily true that A caused B

The economy was expanding during all of the years that I was a student, but as soon as I graduated, the economy contracted. Therefore, the labor market was waiting until I started looking for a job to contract. This statement is an example of A) ceteris paribus fallacy. B) post hoc, ergo propter hoc fallacy. C) fallacy of composition. D) fallacy of inductive reasoning

B) post hoc, ergo propter hoc fallacy

It always rains about an hour after you finish washing your car. Concluding that washing your car caused it to rain is an example of the A) fallacy of composition. B) post hoc, ergo propter hoc fallacy. C) fallacy of inductive reasoning. D) ceteris paribus conditions.

B) post hoc, ergo propter hoc fallacy.

An efficient market is characterized by the fact that A) output is steady or growing and there is low inflation. B) profit opportunities are eliminated almost instantaneously. C) there are no opportunity costs. D) wealth is distributed fairly.

B) profit opportunities are eliminated almost instantaneously.

Economists often refer to risk-free ventures as A) efficient market outcomes. B) profit opportunities. C) those with no opportunity costs. D) break-even propositions.

B) profit opportunities.

The concept of equity would explain the redistribution from the rich to the poor which is achieved from a tax system that requires taxes to * A) fall when income rises. B) rise when income rises. C) remain stable when income rises. D) be unrelated to income

B) rise when income rises.

A government policy that tries to minimize inflation and unemployment can best be described as trying to achieve economic A) growth. B) stability. C) profitability. D) equity.

B) stability.

An efficient economy is an economy A) in which output is steady or growing and there is low inflation. B) that produces what consumers demand and does so at the least possible cost. C) that distributes output equally among all consumers. D) in which there is a fair distribution of wealth

B) that produces what consumers demand and does so at the least possible cost.

If you own a building and you decide to use that building to open a book store, A) there is no opportunity cost of using this building for a book store because you own it. B) there is an opportunity cost of using this building for a book store because it could have been used in other ways. C) the opportunity costs equal the cost of inventory. D) the only cost relevant to this decision is the price you paid for the building

B) there is an opportunity cost of using this building for a book store because it could have been used in other ways.

The slope of a horizontal line is A) negative. B) zero. C) continually changing. D) infinite.

B) zero.

Which of the following statements is NOT correct? A) Economics is a behavioral science. B) In large measure, economics is the study of how people make choices. C) If poverty were eliminated, there would be no reason to study economics. D) Economic analysis can be used to explain how both individuals and societies make decisions.

C) If poverty were eliminated, there would be no reason to study economics.

Which of the following is a question answered with positive economic analysis? A) Should the college offers free parking for students? B) Should the college provide more financial aid assistance? C) If the college increased tuition, will class size decline? D) Should the college cut tuition to stimulate enrollment?

C) If the college increased tuition, will class size decline? --------------------------------------- positive economic It is concerned with "What it is" An approach to economics that seeks to understand behavior and the operation of systems without making judgments.

The principle that irrelevant detail should not be included in a model is known as A) a fallacy. B) ceteris paribus. C) Ockham's razor. D) normative economics

C) Ockham's razor.

Which of the following is an example of a normative question? A) How will an increase in the price of diesel fuel affect truck drivers? B) What fraction of an income-tax rebate check will be spent on consumer goods? C) Should the government provide free prescription drugs to lower-income citizens? D) How will an increase in the minimum wage affect migrant workers?

C) Should the government provide free prescription drugs to lower-income citizens? ------------------------------------------------------ normative It is concerned with "What should be" or "What ought to be" An approach to economics that analyzes outcomes of economic behavior, evaluates them as good or bad, and may prescribe courses of action.

Which of the following is a normative question? A) Why do gasoline prices increase between Memorial Day and Labor Day? B) What will happen to gasoline consumption if the federal tax on gasoline is eliminated? C) To reduce the regressive nature of the gasoline excise tax, should the portion of the gasoline excise tax paid by high-income individuals be increased? D) How will oil exploration be affected if the government subsidizes oil producers?

C) To reduce the regressive nature of the gasoline excise tax, should the portion of the gasoline excise tax paid by high-income individuals be increased?

The government should extend the duration of unemployment benefits to those workers who lost their jobs due to outsourcing. This statement is best described as A) an example of marginalism. B) an example of the fallacy of composition. C) a normative statement. D) a positive statement

C) a normative statement.

The Latin phrase ceteris paribus means that when a relationship between two variables is being studied A) both are treated as unpredictable. B) neither of those two variables is allowed to change. C) all other variables are held fixed. D) we recognize that some factors are unknown

C) all other variables are held fixed.

Q: To isolate the impact of one single factor, economists invoke the assumption of B) post hoc, ergo prompter hoc . C) ceteris paribus . D) Ockhamʹs razor.

C) ceteris paribus . الحل من التجميعات

To isolate the impact of one single factor, economists invoke the assumption of A) inductive reasoning. B) Ockham's razor. C) ceteris paribus. D) post hoc, ergo propter hoc

C) ceteris paribus.

Many economists argue that items such as food and clothing should be exempt from sales tax because low-income people spend a greater percentage of their income on these goods than do high-income individuals. This argument is motivated by concerns over A) economic stability. B) economic growth. C) equity. D) efficiency.

C) equity.

Experimental research in small cities suggests that mandating work for welfare recipients increases their income. Therefore, we should mandate work requirements for all welfare recipients. This statement is an example of A) fallacy of inductive reasoning. B) ceteris paribus fallacy. C) fallacy of composition. D) post hoc, ergo prompter hoc fallacy.

C) fallacy of composition.

The slope of a non-linear curve A) is always positive. B) must first increase then decrease. C) is not constant. D) is constant

C) is not constant.

By invoking the assumption of ceteris paribus, economists A) consider the impact of all relevant factors. B) hold all variables constant when analyzing a model. C) isolate the impact of one single variable while holding all other variables constant. D) exclude irrelevant detail when analyzing a model.

C) isolate the impact of one single variable while holding all other variables constant. --------------------------------------------- A device/concept used to analyze the relationship between two variables while the values of other variables are held unchanged. abstraction process

Suppose that you purchased a ticket to a jazz festival for $100 from an online ticket broker. Once you arrived at the festival, you discovered that parking costs you an additional $15. In this situation, the additional $15 you pay for parking is an example of A) an inefficient cost. B) economic loss C) marginal cost.

C) marginal cost.

Studying how the management of Hewlett Packard decides how many computers to produce and the price to charge for its computers would be considered A) descriptive economics. B) empirical economics. C) microeconomics. D) macroeconomics

C) microeconomics.

An approach to economics that applies statistical techniques and data to economic problems is called A) Ockhamʹs razor. B) laissez-faire economics. C) positive economics. D) normative economics.

C) positive economics.

There is great concern over the fact that global warming is causing permanent damage to the global environment. A study of the costs and benefits of purchasing carbon offsets to combat global warming is an example of A) labor economics. B) normative economics. C) positive economics. D) laissez-faire economics.

C) positive economics.

You have observed that every time you get a new tattoo the day before you take an exam you get an A. You therefore conclude that to get an A on an exam, all you have to do is get a new tattoo the day before. You have committed the* A) fallacy of division. B) fallacy of inductive reasoning. C) post hoc, ergo prompter hoc fallacy. D) fallacy of composition.

C) post hoc, ergo prompter hoc fallacy.

You have observed that every time you do 30 minutes of cardio exercise before taking an exam you get an A. You therefore conclude that to get an A on an exam, all you have to do is 30 minutes of cardio exercise before you take an exam. You have committed the A) fallacy of composition. B) fallacy of inductive reasoning. C) post hoc, ergo propter hoc fallacy. D) fallacy of division.

C) post hoc, ergo propter hoc fallacy.

Positive economics is an approach to economics that A) seeks to understand behavior and the operation of systems while making judgments about their usefulness to society. B) analyzes outcomes of economic behavior, evaluates them as good or bad, and may prescribe preferred courses of action. C) seeks to understand behavior and the operation of systems without making judgments. D) examines the role of government in the economy.

C) seeks to understand behavior and the operation of systems without making judgments.

The fallacy of composition is A) the belief that if Event A happens before Event B happens, then Event A causes Event B to occur. B) the belief that what is true for the whole is necessarily true of the parts. C) the belief that what is true for a part is necessarily true for the whole. D) the belief that it is impossible to draw generalizations about cause and effect.

C) the belief that what is true for a part is necessarily true for the whole.

Which of the following is a question answered with normative economic reasoning? A) If the college offers free parking for students, will more students drive to campus? B) If the college provided more financial aid assistance, would more students benefit? C) If the college increased tuition, would class size decline? D) Should the college cut tuition to stimulate enrollment?

D) Should the college cut tuition to stimulate enrollment?

• Among the fundamental concepts in economics are A) opportunity cost. B) marginalism. C) efficient markets. D) all of the above

D) all of the above

A market in which profit opportunities are eliminated almost instantaneously is A) a laissez-faire market. B) a capitalist market. C) a socialist market. D) an efficient market.

D) an efficient market.

Inflation and unemployment A) are the focus of normative economics. B) are a focus of microeconomics. C) are a focus of positive economics. D) are a focus of macroeconomics.

D) are a focus of macroeconomics.

Salary caps are imposed when league officials believe some football team owners are taking advantage of their deep pockets and buying more quality players than the other owners can afford to buy. Which of the following criteria are they using to guide their actions?* A) growth B) stability C) efficiency D) equity

D) equity

There is a possibility that a national sales tax will be implemented. Many economists argue that items such as food and clothing should be exempt from such a tax because low-income people spend a greater percentage of their income on these goods than do high-income individuals. This argument is motivated by concerns over' A) economic growth. B) economic stability. C) efficiency. D) equity.

D) equity.

There is a possibility that a rational sales tax will be implemented. Many economists argue that items such as food and clothing should be exempt from such a tax because low-income people spend a great percentage of these income on these goods than do high-income individuals. This argument is motivated by concerns over A) economic growth. B) stability. C) efficacy. D) equity.

D) equity.

You have noticed that there is an increase in the number of homeless people in your city and at the same time you observe that there are a number of vacant apartments. You believe that if landlords were required to rent their apartments for less than they are currently charging, the government could reduce the number of homeless people* This policy recommendation would be motivated by concerns over A) economic growth. B) stability. C) profitability. D) equity.

D) equity.

You know that the computer lab at school gets very crowded at about 3:00 p.m. To avoid the crowds, you start going to the computer lab one hour earlier every day. However many students make the same decision, and now the computer lab becomes very crowded at 2:00 p.m. This is an example of the A) post hoc, ergo propter hoc fallacy. B) ceteris paribus fallacy. C) fallacy of division. D) fallacy of composition

D) fallacy of composition

• If the slope of a straight line is 4 and if X (the variable on the horizontal axis) increases by 12, then Y (the variable on the vertical axis) will A) decrease by 3. B) decrease by 0.33. C) increase by 3. D) increase by 48.

D) increase by 48.

Ockhamʹs razor is the principle that states A) supply creates its own demand. B) we must forego something when making a decision. C) costs which have been incurred cannot be avoided. D) irrelevant detail should not be included in a model.

D) irrelevant detail should not be included in a model. ------------------------------------------------------- The principle that irrelevant detail should be cut away

The branch of economics that examines the functioning of individual industries and the behavior of individual decision-making units is A) positive economics. B) normative economics. C) macroeconomics. D) microeconomics.

D) microeconomics.

If you observe that Kelly Clarkson won American Idol 3 years before Carrie Underwood won, and you conclude that Kelly Clarkson winning caused Carrie Underwood to win 3 years later, you would be guilty of an error called the* A) fallacy of inductive reasoning. B) fallacy of ceteris paribus. C) fallacy of composition. D) post hoc, ergo prompter hoc fallacy

D) post hoc, ergo prompter hoc fallacy

You always have math problems to work in class whenever you forget to bring your calculator to school. Concluding that forgetting your calculator causes your professor to assign math problems is an example of the* A) fallacy of composition. B) fallacy of inductive reasoning. C) ceteris paribus conditions. D) post hoc, ergo prompter hoc fallacy.

D) post hoc, ergo prompter hoc fallacy.

If you observe that Event A happens before Event B happens, and you conclude that Event A caused Event B, you would be guilty of an error called the A) fallacy of composition. B) fallacy of inductive reasoning. C) fallacy of ceteris paribus. D) post hoc, ergo propter hoc fallacy.

D) post hoc, ergo propter hoc fallacy.

The reason that opportunity costs arise is that A) an economy relies on money to facilitate exchange of goods and services. B) there is no alternative decisions that could be made. C) people have limited wants D) resources are scarce

D) resources are scarce

Which of the following is NOT an opportunity cost of attending college? A) the tuition you pay B) the income you could have earned if you didn't attend college C) the alternative uses of the time you spend studying D) the cost of the food that you consume while you are attending college

D) the cost of the food that you consume while you are attending college

Which of the following is NOT listed in the book as a reason to study economics? A) to learn a way of thinking B) to understand society C) to be an informed citizen D) to learn how to make lots of money

D) to learn how to make lots of money

We can use macroeconomic analysis to D) understand why economies grow.

D) understand why economies grow.

A measure that can change from observation to observation is known as a(n) A) empirical measure. B) model. C) causality. D) variable.

D) variable.

Q: collection and use of data to test economic theories.

Empirical economics

The Industrial Revolution refers to the rise of the modern factory system in ________ during the late eighteenth and early nineteenth centuries

England

The rate of unemployment is a topic of microeconomics True or False ?

False

That which we forgo, or give up, when we make a choice or a decision is known as

Opportunity Cost

Q: you have narrowed down your Saturday night plans to either going bowling or playing basketball. If you choose to go bowling, then for you playing basketball is the ___________ of going bowling.

Opportunity Costs

Opportunity costs arise because resources are limited/scarce True or False

True

Resources are limited in both wealthy and poor societies True or False

True

Economics is best defined as the study of

choices made by people faced with scarcity

If information is more costly and less easily available, then usually this makes market

makes markets less efficient.