ECON 101 CORE MAIN EXAMINATION QUESTIONS
AND ANSWERS SURE A+
✔✔The demand curve for dolls shows the quantity of dolls demanded
a. at each level of income
b. at the equilibrium price for dolls
c. by U.S. consumers
d. by suppliers of those dolls
e. at each possible price of dolls - ✔✔e. at each possible price of dolls
✔✔According to the law of demand,
a. there is a positive relationship between quantity demanded and price
b. as the price rises, demand will shift to the right
c. as the price rises, consumers will continue to purchase the same quantity of the good
d. as the price rises, demand will shift to the left
e. there is a negative relationship between quantity demanded and price - ✔✔e. there is
a negative relationship between quantity demanded and price
✔✔Even though households may have unlimited wants, they have to allocate their
spending carefully because they
a. do not want their credit card bills to be too high
b. worry about their taxes
c. have limited intelligence
,d. have limited incomes
e. basically want to become wealthy - ✔✔d. have limited incomes
✔✔An entrepreneur is best described as
a. someone that is hired to work in a firm
b. someone who creates human capital
c. someone with the ability to combine other resources in a productive enterprise
d. anyone who owns productive enterprise
e. anyone who produces long-lived physical capital - ✔✔c. someone with the ability to
combine other resources in a productive enterprise
✔✔The overall performance of the economic system as a whole is the focus of
a. international finance
b. labor economics
c. microeconomics
d. macroeconomics
e. public economics - ✔✔d. macroeconomics
✔✔Microeconomics analyzes individual parts of the economy rather than broad
economic aggregates.
a. True
b. False - ✔✔a. True
✔✔Suppose that the Council of Economic Advisers tells the President that "the
unemployment rate is 4 percent." The President responds, "That rate is still too high."
The President's statement is
a. a normative statement
b. a positive statement
c. empirically verifiable by checking economic data
d. an indisputable statistical fact
e. an incorrect positive statement - ✔✔a. a normative statement
✔✔Individuals face opportunity costs because
a. the minimum wage is too low
b. technology is improving too quickly
c. time and funds are scarce
d. government cutbacks are widespread, except possibly among society's most affluent
households
e. welfare gives individuals an incentive to stay at home - ✔✔c. time and funds are
scarce
✔✔When households and businesses interact in resource markets money
a. is not exchanged
b. is flowing toward businesses
c. is flowing toward households
, d. is not used at all
e. is flowing to both businesses and households - ✔✔c. is flowing toward households
✔✔When demand increases,
a. consumers are willing and able to purchase more of the good at every price
b. is flowing toward businesses
c. is flowing toward households
d. is not used at all
e. is flowing to both businesses and households - ✔✔a. consumers are willing and able
to purchase more of the good at every price
✔✔Supply curves are usually assumed to slope upward because
a. profits fall as prices rise
b. a higher price leads to increases in demand
c. a higher price leads to decreases in demand
d. a higher price attracts resources from other less valued uses
e. firms drop out of the market as prices rise - ✔✔d. a higher price attracts resources
from other less valued uses
✔✔Which of the following would not lead to a change in the supply of chocolate ice
cream?
a. a change in productive capacity
b. a change in the price of strawberry ice cream
c. a change in the price of milk
d. a change in the price of chocolate ice cream
e. a change in the expected future price of chocolate ice cream - ✔✔d. a change in the
price of chocolate ice cream
✔✔Which of the following would cause a leftward shift of the supply curve for
computers?
a. an increase in the price of printed circuit boards used to build computers
b. a decrease in the price of electricity
c. an increase in incomes of consumers
d. a decrease in the price of computers
e. a decrease in the size of the population - ✔✔a. an increase in the price of printed
circuit boards used to build computers
✔✔If both the demand and supply curves for computers shift to the right, the price of
computers may rise, fall, or remain unchanged.
a. True
b. False - ✔✔a. True
✔✔If the market for a good is initially in equilibrium and there is a rightward shift of the
demand curve, then
a. the equilibrium price will fall
AND ANSWERS SURE A+
✔✔The demand curve for dolls shows the quantity of dolls demanded
a. at each level of income
b. at the equilibrium price for dolls
c. by U.S. consumers
d. by suppliers of those dolls
e. at each possible price of dolls - ✔✔e. at each possible price of dolls
✔✔According to the law of demand,
a. there is a positive relationship between quantity demanded and price
b. as the price rises, demand will shift to the right
c. as the price rises, consumers will continue to purchase the same quantity of the good
d. as the price rises, demand will shift to the left
e. there is a negative relationship between quantity demanded and price - ✔✔e. there is
a negative relationship between quantity demanded and price
✔✔Even though households may have unlimited wants, they have to allocate their
spending carefully because they
a. do not want their credit card bills to be too high
b. worry about their taxes
c. have limited intelligence
,d. have limited incomes
e. basically want to become wealthy - ✔✔d. have limited incomes
✔✔An entrepreneur is best described as
a. someone that is hired to work in a firm
b. someone who creates human capital
c. someone with the ability to combine other resources in a productive enterprise
d. anyone who owns productive enterprise
e. anyone who produces long-lived physical capital - ✔✔c. someone with the ability to
combine other resources in a productive enterprise
✔✔The overall performance of the economic system as a whole is the focus of
a. international finance
b. labor economics
c. microeconomics
d. macroeconomics
e. public economics - ✔✔d. macroeconomics
✔✔Microeconomics analyzes individual parts of the economy rather than broad
economic aggregates.
a. True
b. False - ✔✔a. True
✔✔Suppose that the Council of Economic Advisers tells the President that "the
unemployment rate is 4 percent." The President responds, "That rate is still too high."
The President's statement is
a. a normative statement
b. a positive statement
c. empirically verifiable by checking economic data
d. an indisputable statistical fact
e. an incorrect positive statement - ✔✔a. a normative statement
✔✔Individuals face opportunity costs because
a. the minimum wage is too low
b. technology is improving too quickly
c. time and funds are scarce
d. government cutbacks are widespread, except possibly among society's most affluent
households
e. welfare gives individuals an incentive to stay at home - ✔✔c. time and funds are
scarce
✔✔When households and businesses interact in resource markets money
a. is not exchanged
b. is flowing toward businesses
c. is flowing toward households
, d. is not used at all
e. is flowing to both businesses and households - ✔✔c. is flowing toward households
✔✔When demand increases,
a. consumers are willing and able to purchase more of the good at every price
b. is flowing toward businesses
c. is flowing toward households
d. is not used at all
e. is flowing to both businesses and households - ✔✔a. consumers are willing and able
to purchase more of the good at every price
✔✔Supply curves are usually assumed to slope upward because
a. profits fall as prices rise
b. a higher price leads to increases in demand
c. a higher price leads to decreases in demand
d. a higher price attracts resources from other less valued uses
e. firms drop out of the market as prices rise - ✔✔d. a higher price attracts resources
from other less valued uses
✔✔Which of the following would not lead to a change in the supply of chocolate ice
cream?
a. a change in productive capacity
b. a change in the price of strawberry ice cream
c. a change in the price of milk
d. a change in the price of chocolate ice cream
e. a change in the expected future price of chocolate ice cream - ✔✔d. a change in the
price of chocolate ice cream
✔✔Which of the following would cause a leftward shift of the supply curve for
computers?
a. an increase in the price of printed circuit boards used to build computers
b. a decrease in the price of electricity
c. an increase in incomes of consumers
d. a decrease in the price of computers
e. a decrease in the size of the population - ✔✔a. an increase in the price of printed
circuit boards used to build computers
✔✔If both the demand and supply curves for computers shift to the right, the price of
computers may rise, fall, or remain unchanged.
a. True
b. False - ✔✔a. True
✔✔If the market for a good is initially in equilibrium and there is a rightward shift of the
demand curve, then
a. the equilibrium price will fall
