HW Chapter 1
Percentage change
(value in the second period - value in the first period / value in the first period) x 100
Slope formula
(y2 - y1)/(x2 - x1)
Area of triangle
1/2 x base x height
In your economics class, you scored a 67 on the first quiz, a 86 on the second quiz, and a 79 on the third quiz. Your average quiz is _____. On the fourth quiz, you scored an 82. Did the fourth quiz raise your average?
77.3 Yes
Scarcity is central to the study of economics because it implies that
Every choice involves an opportunity cost
The effect of higher income taxes on the total amount of consumer spending. This is a _____ issue.
Macroeconomic
The reasons for the economics of East Asian countries growing faster than the economies of sub-Saharan African countries. This is a _____ issue.
Macroeconomic
Which of the following areas of economics studies issues such as whether government intervention is capable of reducing the severity of recessions?
Macroeconomics
Which of the following covers the study of topics such as inflation or unemployment?
Macroeconomics
Economists use the word marginal to mean an extra or additional benefit or cost of a decision. An optimal decision occurs when
Marginal benefit equals marginal cost
The effect of higher cigarette taxes on the quantity of cigarettes sold. This is a _____ issue
Microeconomic
The reasons for low rates of profit in the airline industry. This is a _____ issue.
Microeconomic
Which of the following areas of economics studies issues such as ways to reduce teenage smoking?
Microeconomics
A primary difference between macroeconomics and microeconomics is
Microeconomics examines individual markets while macroeconomics examines the economy as a whole.
In the diagram to the right, the curve "S" is apparently _____, while the curve labeled "D" is apparently _____.
Nonlinear Linear
What type of economic analysis is concerned with the way things ought to be?
Normative Analysis
The federal government should spend more on AIDS research. This represents
Normative analysis
The price of coffee at Starbucks is too high. This represents
Normative analysis
A 50-cent-per-pack tax on cigarettes will reduce smoking by teenagers by 12 percent. This represents
Positive analysis
Rising paper prices will increase textbook prices. This represents
Positive analysis
______ is concerned with what is, and _____ is concerned with what ought to be. Economists is about _____, which measures the costs and benefits of different courses of action.
Positive analysis Normative analysis Positive analysis
Total revenue
Price x Quantity
One of the basic facts of life is that people must make choices as they try to attain their goals. This unavoidable fact comes from a reality an economist calls
Scarcity
Macroeconomics is
The study of the company as a whole, including topics such as inflation, unemployment, and economic growth
Economists assume that people are rational in the sense that
They are all available information as they take actions intended to achieve their goals
Macroeconomics is most likely to include the study of
Unemployment
Which of the following describes scarcity?
Unlimited wants exceed the limited resources available
Microsoft charges a price of $599 for a copy of Windows 7. Is this pricing decision rational?
When we assume the managers at Microsoft have used all available information and have weighted all known benefits and costs, we are assuming rationality
Microeconomics is the study of
how households and firms make choices, how they interact in markets, and how the government attempts to influence their choices
