TEST BANK
MACROECONOMICS
3RD EDITION
CHAPTER 1: ECONOMICS AND LIFE
MULTILE CHOICE
1) The principles of economics can explain which of the following?
1.Why people choose to work or go to college
2.Why a country might prosper
3.How the value of money changes over time
A) II and III only
B) I and II only
C) III only
D) I, II, and III
ANS: D
2) Who makes decisions about how to allocate resources?
A) Individuals
B) Businesses
C) Governments
D) All of these make decisions about resource allocation.
ANS: D
3) Which of the following statements best describes the study of economics?
A) Economics studies how the Federal Reserve handles fluctuation in business cycles.
B) Economics studies how individuals and groups manage scarce resources.
C) Economics studies how people maximize returns in the stock market.
D) Economics studies how governments determine appropriate tax rates.
,ANS: B
4) Alan could apply the principles of economic decision making when deciding:
1.how to spend his paycheck.
2.who to marry.
3.what to have for dinner after a long day at work.
A) I, II, and III
B) I only
C) I and III
D) II and III
ANS: A
5) The two broad fields that make up the subject of economics are:
A) microeconomics and macroeconomics.
B) personal investments and business investments.
C) fiscal policy and monetary policy.
D) imports and exports.
ANS: A
6) Which of the following is considered a microeconomic issue?
A) The local university decides to raise tuition for online course offerings.
B) The country of Zimbabwe has experienced a decline in inflation.
C) The economic growth rate rises in the United States.
D) The unemployment rate in Greece falls.
ANS: A
7) Which of the following is considered a microeconomic issue?
A) The unemployment rate in the United States from 1980 to present day
B) Apple's newest version of the iPhone
C) France’s growth rate over the last year
D) All of these are examples of microeconomic issues.
ANS: B
,8) Suppose Disney World decides to charge local residents a lower price than other park
visitors. This would fall under which field of economics?
A) Macroeconomics
B) Public policy
C) Customer service
D) Microeconomics
ANS: D
9) Which of the following is considered a microeconomic issue?
A) Chinese economic growth has declined.
B) The Federal Reserve cuts key interest rates in order to stimulate lending.
C) Walmart decides to add more self-checkout machines as the cost of labor rises.
D) India experiences a reduction in unemployment after opening its borders to trade.
ANS: C
10) Which of the following is considered a microeconomic issue?
A) The Bureau of Economic Analysis reviews quarterly national income accounting data.
B) A firm decides to purchase pay-per-click online advertising.
C) The Federal Reserve increases the discount rate.
D) The CPI reports a rise in inflation during the month of July.
ANS: B
11) Which of the following questions would be studied in microeconomics?
A) Why did our economic growth rate slow down during the 2000s?
B) How did the recession end in 2009 if unemployment continued to rise?
C) How will the legalization of marijuana in Colorado affect the market for cigarettes?
D) When should Congress raise taxes in order to tackle the debt crisis?
ANS: C
12) Which broad field of economics would most likely study how consumers respond to a
hike in alcohol taxes?
, A) Microeconomics
B) Marginal economics
C) Macroeconomics
D) Monetary economics
ANS: A
13) The broad field of _____ would most likely study how all consumers respond to a hike in
cigarette taxes.
A) microeconomics
B) development economics
C) macroeconomics
D) labor economics
ANS: A
14) The Bureau of Economic Analysis releases last quarter's growth rate in real GDP. This
release would most likely have been written by a:
A) monetary economist.
B) macroeconomist.
C) microeconomist.
D) labor economist.
ANS: B
15) Which of the following is considered a macroeconomic topic?
A) iTunes raises the price of all its music.
B) iTunes raises the price of its pop artists’ music only.
C) A local McDonald’s franchise decides to hire more workers.
D) The U.S. labor force participation rate falls.
ANS: B
MACROECONOMICS
3RD EDITION
CHAPTER 1: ECONOMICS AND LIFE
MULTILE CHOICE
1) The principles of economics can explain which of the following?
1.Why people choose to work or go to college
2.Why a country might prosper
3.How the value of money changes over time
A) II and III only
B) I and II only
C) III only
D) I, II, and III
ANS: D
2) Who makes decisions about how to allocate resources?
A) Individuals
B) Businesses
C) Governments
D) All of these make decisions about resource allocation.
ANS: D
3) Which of the following statements best describes the study of economics?
A) Economics studies how the Federal Reserve handles fluctuation in business cycles.
B) Economics studies how individuals and groups manage scarce resources.
C) Economics studies how people maximize returns in the stock market.
D) Economics studies how governments determine appropriate tax rates.
,ANS: B
4) Alan could apply the principles of economic decision making when deciding:
1.how to spend his paycheck.
2.who to marry.
3.what to have for dinner after a long day at work.
A) I, II, and III
B) I only
C) I and III
D) II and III
ANS: A
5) The two broad fields that make up the subject of economics are:
A) microeconomics and macroeconomics.
B) personal investments and business investments.
C) fiscal policy and monetary policy.
D) imports and exports.
ANS: A
6) Which of the following is considered a microeconomic issue?
A) The local university decides to raise tuition for online course offerings.
B) The country of Zimbabwe has experienced a decline in inflation.
C) The economic growth rate rises in the United States.
D) The unemployment rate in Greece falls.
ANS: A
7) Which of the following is considered a microeconomic issue?
A) The unemployment rate in the United States from 1980 to present day
B) Apple's newest version of the iPhone
C) France’s growth rate over the last year
D) All of these are examples of microeconomic issues.
ANS: B
,8) Suppose Disney World decides to charge local residents a lower price than other park
visitors. This would fall under which field of economics?
A) Macroeconomics
B) Public policy
C) Customer service
D) Microeconomics
ANS: D
9) Which of the following is considered a microeconomic issue?
A) Chinese economic growth has declined.
B) The Federal Reserve cuts key interest rates in order to stimulate lending.
C) Walmart decides to add more self-checkout machines as the cost of labor rises.
D) India experiences a reduction in unemployment after opening its borders to trade.
ANS: C
10) Which of the following is considered a microeconomic issue?
A) The Bureau of Economic Analysis reviews quarterly national income accounting data.
B) A firm decides to purchase pay-per-click online advertising.
C) The Federal Reserve increases the discount rate.
D) The CPI reports a rise in inflation during the month of July.
ANS: B
11) Which of the following questions would be studied in microeconomics?
A) Why did our economic growth rate slow down during the 2000s?
B) How did the recession end in 2009 if unemployment continued to rise?
C) How will the legalization of marijuana in Colorado affect the market for cigarettes?
D) When should Congress raise taxes in order to tackle the debt crisis?
ANS: C
12) Which broad field of economics would most likely study how consumers respond to a
hike in alcohol taxes?
, A) Microeconomics
B) Marginal economics
C) Macroeconomics
D) Monetary economics
ANS: A
13) The broad field of _____ would most likely study how all consumers respond to a hike in
cigarette taxes.
A) microeconomics
B) development economics
C) macroeconomics
D) labor economics
ANS: A
14) The Bureau of Economic Analysis releases last quarter's growth rate in real GDP. This
release would most likely have been written by a:
A) monetary economist.
B) macroeconomist.
C) microeconomist.
D) labor economist.
ANS: B
15) Which of the following is considered a macroeconomic topic?
A) iTunes raises the price of all its music.
B) iTunes raises the price of its pop artists’ music only.
C) A local McDonald’s franchise decides to hire more workers.
D) The U.S. labor force participation rate falls.
ANS: B
