Foundations of Economics, 3e (Bade/Parkin) - Testbank 1
Chapter 1 Getting Started
1) Scarcity
Society's ability to satisfy our wants
3) The economic choices made by individuals, businesses, and governments and the interactions of those
choices answer which three major economic questions?
5) When a home builder decides to computerize all of its production schedule, it directly answers the ___ questi
6)
Of the three major economic questions, which of the following is the best example of a "How?" question?
7)
In Germany, industrial robots play a major role in manufacturing automobiles. Based on this observation,
Germany has decided that "industrial robots" will help answer what microeconomic question?
8) When the federal government decides to pay senators more than it pays soldiers, it answers the ____
question.
9) If Salome effectively uses available resources to satisfy her wants, we say Salome
10) You have chosen to take a trip during Spring Break. If you had not gone, you would either have worked at a
temporary job or studied for exams. The opportunity cost of your trip is
11) Suppose you paid $400 tuition for a three-credit course. After the official withdrawal date has elapsed, you
decide to drop the course but you cannot get back your $400. At this time, the $400 i
12)
In economics, the benefit derived from making a choice refers to
13)
The cost of a one-unit increase in an activity is called the
14)
The benefit of a one-unit increase in an activiy
15)
Decision making on the margin involves
16) We definitely have made a rational decision
19)
17) The decision to go to graduate school is a rational one for a college student if the
18) An incentive is
Which of the following is an incentive?
20) "Lower ticket prices would lead to more people attending ballgames." This statement is a
21) Normative statements
i. describe how the world is.
ii. describe how the world ought to be.
iii. depend on people's values and cannot be tested.
22) A statement that "All children should receive free health care" is an example of what kind of statement
23)
The Latin phrase ceteris paribus mean
24)
A cross-section graph
.
25) A graph that shows the value of an economic variable for different groups in a population at a given time is
called
38)
Which of the following is true regarding a normative statement?
i) It uses the ceteris paribus assumption.
ii) It is a value judgment.
iii) It accounts for opportunity costs.
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