Package Title: Test Bank
Course Title: Microeconomics: Theory and Application, 12e
Chapter Number: 1
Question Type: Multiple Choice
1. Which of the following is generally considered to be a microeconomic question?
a. The relationship between the money supply and nominal GDP
b. The responsiveness of aggregate demand to change in government expenditure.
c. The relationship between productivity of workers and wages received by them
d. The relationship between inflation and unemployment
Answer: C
Difficulty Level: Medium
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
2. Microeconomics is also known as price theory because:
a. everything has a price.
,b. prices have important effects on individual and firm decisions.
c. prices are the only determinant of economic outcomes.
d. prices change constantly.
Answer: B
Difficulty Level: Easy
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
3. Which of the following is generally considered a microeconomic question?
a. The relationship between the money supply and nominal GDPb. The relationship
between the unemployment and inflation
c. The impact of a tax cut on public saving
d. The effect of anti-discrimination laws on employers’ hiring practices.
Answer: D
Difficulty Level: Easy
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
,4. Which of the following economic decisions is not a part of the study of
microeconomics?
a. A consumer's decision regarding how much of a good to purchase
b. A worker's decision concerning which job to take
c. A business firm's decision regarding how many machines to purchased.
d. The government's decision regarding the use of monetary or fiscal policy to control
increasing prices
Answer: D
Difficulty Level: Medium
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
5. Macroeconomics deals primarily with:
a. aggregate economic factors.
b. the behavior of rational consumers.
c. the role of politics in economics.
d. a society’s economic and cultural environment.
Answer: A
Difficulty Level: Easy
Section Reference: The Scope of Microeconomic Theory
, Learning Objective: Convey the scope of microeconomic theory.
6. Which of the following best describes the difference between micro and
macroeconomics?
a. Macroeconomics deals with bigger, more important issues, while microeconomics
deals with the smaller, less significant details.
b. Macroeconomics studies the actions of large firms while microeconomics studies the
behavior of small firms and individuals.
c. Macroeconomics is the study of aggregate factors while microeconomics is the study
of individuals and individual firms.
d. Macroeconomics studies long-run behavior (one-year or more) while microeconomics
studies short-run or immediate behavior.
Answer: C
Difficulty Level: Easy
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
7. Theory A is considered to be better than Theory B if:
a. the assumptions of B are more realistic than the assumptions of A.
b. A takes into consideration more facts than B.
c. A predicts or explains a certain phenomenon better than B.
d. A uses more mathematics than B.
Course Title: Microeconomics: Theory and Application, 12e
Chapter Number: 1
Question Type: Multiple Choice
1. Which of the following is generally considered to be a microeconomic question?
a. The relationship between the money supply and nominal GDP
b. The responsiveness of aggregate demand to change in government expenditure.
c. The relationship between productivity of workers and wages received by them
d. The relationship between inflation and unemployment
Answer: C
Difficulty Level: Medium
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
2. Microeconomics is also known as price theory because:
a. everything has a price.
,b. prices have important effects on individual and firm decisions.
c. prices are the only determinant of economic outcomes.
d. prices change constantly.
Answer: B
Difficulty Level: Easy
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
3. Which of the following is generally considered a microeconomic question?
a. The relationship between the money supply and nominal GDPb. The relationship
between the unemployment and inflation
c. The impact of a tax cut on public saving
d. The effect of anti-discrimination laws on employers’ hiring practices.
Answer: D
Difficulty Level: Easy
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
,4. Which of the following economic decisions is not a part of the study of
microeconomics?
a. A consumer's decision regarding how much of a good to purchase
b. A worker's decision concerning which job to take
c. A business firm's decision regarding how many machines to purchased.
d. The government's decision regarding the use of monetary or fiscal policy to control
increasing prices
Answer: D
Difficulty Level: Medium
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
5. Macroeconomics deals primarily with:
a. aggregate economic factors.
b. the behavior of rational consumers.
c. the role of politics in economics.
d. a society’s economic and cultural environment.
Answer: A
Difficulty Level: Easy
Section Reference: The Scope of Microeconomic Theory
, Learning Objective: Convey the scope of microeconomic theory.
6. Which of the following best describes the difference between micro and
macroeconomics?
a. Macroeconomics deals with bigger, more important issues, while microeconomics
deals with the smaller, less significant details.
b. Macroeconomics studies the actions of large firms while microeconomics studies the
behavior of small firms and individuals.
c. Macroeconomics is the study of aggregate factors while microeconomics is the study
of individuals and individual firms.
d. Macroeconomics studies long-run behavior (one-year or more) while microeconomics
studies short-run or immediate behavior.
Answer: C
Difficulty Level: Easy
Section Reference: The Scope of Microeconomic Theory
Learning Objective: Convey the scope of microeconomic theory.
7. Theory A is considered to be better than Theory B if:
a. the assumptions of B are more realistic than the assumptions of A.
b. A takes into consideration more facts than B.
c. A predicts or explains a certain phenomenon better than B.
d. A uses more mathematics than B.
