Test Bank for Microeconomics Canada in the Global Environment, 12th E Michael Parkin
Latest Edition ✅
Microeconomics: Canada in the Global Environment, 12e (Parkin)
Chapter 1 What Is Economics?
1.1 Definition of Economics
1) What is the fundamental fact that dominates our lives?
A) We have unlimited wants and limited resources.
B) We have unlimited resources and don't know how to allocate them.
C) Our resources can't be allocated without government intervention.
D) Resources cost too much.
E) We have limited wants and limited resources.
Answer: A
Diff: 1 Type: MC
Topic: Definition of Economics
2) Who does scarcity confront?
Scarcity confronts
A) countries but not individuals.
B) low-income families but not high-income families.
C) the private sector but not the government.
D) all living things.
E) individuals but not countries.
Answer: D
Diff: 1 Type: MC
Topic: Definition of Economics
3) Which of the following sentences is consistent with scarcity?
A) We have enough time, but we want more money.
B) If you are content owning few possessions, you'll never face scarcity.
C) We can't afford everything we want, so we must make choices among alternatives.
D) Billionaires can afford anything they want, so they don't face scarcity.
E) If you can afford housing and food, you don't face scarcity.
Answer: C
Diff: 2 Type: MC
Topic: Definition of Economics
1
,4) In the following situations, who faces scarcity?
Latesha chooses to study Engineering at Western instead of studying Math at Waterloo.
Roz decides to go to Western, but all her friends from high school are going to Waterloo.
Courtney decides that Western's campus is more attractive than the campus at Waterloo.
A) Only Latesha faces scarcity.
B) Only Roz faces scarcity.
C) Only Latesha and Roz face scarcity.
D) Only Courtney faces scarcity.
E) Latesha, Roz, and Courtney face scarcity.
Answer: C
Diff: 2 Type: MC
Topic: Definition of Economics
5) You want to buy a new pair of jeans. What limits what you can afford to buy?
What you can afford to buy is limited by
A) what you want.
B) the styles available.
C) the brand of jeans that your friends are wearing.
D) how many pairs of jeans you own.
E) your income and the price you must pay.
Answer: E
Diff: 1 Type: MC
Topic: Definition of Economics
6) Do you face scarcity when you are on vacation?
A) No because you have no deadlines to meet when you are on vacation.
B) Yes because even vacation days have only 24 hours.
C) No because you can do what you want when you are on vacation.
D) Yes because it's difficult to know if you made the right choice of destination.
E) No because your choice of vacation activities is almost infinite.
Answer: B
Diff: 2 Type: MC
Topic: Definition of Economics
7) What is something you want that only the government can provide?
A) clean air
B) affordable food prices
C) education
D) art galleries and museums
E) housing
Answer: A
Diff: 1 Type: MC
Topic: Definition of Economics
2
,8) Can government taxes change choices or decisions?
A) A government makes its spending decisions without regard to the tax revenue it will collect.
B) People make purchasing decisions based on the price of a good and don't consider the sales
tax.
C) Government choices are limited by the taxes they collect, and people's choices are limited by
the taxes they pay.
D) Household choices are limited by the taxes they pay, but business choices are not.
E) Taxes don't limit the choices of low-income households because they pay low taxes.
Answer: C
Diff: 1 Type: MC
Topic: Definition of Economics
9) Are the choices of society limited?
The choices of society
A) aren't limited because human ingenuity can produce anything.
B) are limited by the productive resources available.
C) are limited by the amount of money available.
D) aren't limited because the world has infinite productive resources.
E) aren't limited because of unending technological advances.
Answer: B
Diff: 1 Type: MC
Topic: Definition of Economics
10) What is an incentive?
An incentive is a
A) penalty that leads society to act to eliminate scarcity.
B) reward that encourages equal sharing of resources.
C) reward that encourages an action or a penalty that discourages one.
D) reward that encourages the self-interest but not the social interest.
E) penalty that discourages the social interest but not the self-interest.
Answer: C
Diff: 1 Type: MC
Topic: Definition of Economics
11) Which of the following options describes a choice arising from an incentive?
________ is an incentive that ________.
A) The appearance of spring flowers; announces the beginning of spring
B) Frequent hurricanes; discourages seniors from living in Florida
C) Global warming; discourages global carbon limits
D) A fall in the price of insulin; increases the number of Canadians with diabetes
E) An increase in the gasoline tax; encourages more driving for pleasure
Answer: B
Diff: 2 Type: MC
Topic: Definition of Economics
3
, 12) Fewer avocadoes are offered for sale than people want to buy, and grocery stores
frequently run out. What incentive could grocery stores use to make the choices of buyers
and sellers consistent?
Grocery stores could
A) raise the price of avocadoes.
B) place a tax on avocadoes.
C) stop selling avocadoes.
D) move the avocado display to the front of the store.
E) advertise the health benefits of avocadoes.
Answer: A
Diff: 2 Type: MC
Topic: Definition of Economics
13) What decisions or choices does economics study?
Economics studies
A) production decisions made by businesses but not consumption decisions made by individuals.
B) decisions made by governments as they cope with scarcity but not decisions made by
businesses.
C) decisions made by businesses as they cope with scarcity but not decisions made by
governments.
D) how individuals, businesses, governments, and entire societies made choices to cope with
scarcity.
E) decisions made by wealthy people but not the decisions of low-income people.
Answer: D
Diff: 1 Type: MC
Topic: Definition of Economics
14) Which of the following news headlines describes a topic that economics studies?
A) Federal Election Called for October
B) Celebrity Activists Speak Out Against Climate Change
C) Climate Change Protestors Gather on Parliament Hill
D) Government Introduces Carbon Tax to Fight Climate Change
E) Climate Change Activism on University Campuses
Answer: D
Diff: 2 Type: MC
Topic: Definition of Economics
15) Which of the following options asks a microeconomic question?
A) Why do Canadians buy less honey when the price rises?
B) Why is Canada's inflation rate rising?
C) What is creating Canada's rising unemployment?
D) Why is the Bank of Canada raising interest rates?
E) Why do some Canadians work part time and others full time?
Answer: A
Diff: 2 Type: MC
Topic: Definition of Economics
4
Latest Edition ✅
Microeconomics: Canada in the Global Environment, 12e (Parkin)
Chapter 1 What Is Economics?
1.1 Definition of Economics
1) What is the fundamental fact that dominates our lives?
A) We have unlimited wants and limited resources.
B) We have unlimited resources and don't know how to allocate them.
C) Our resources can't be allocated without government intervention.
D) Resources cost too much.
E) We have limited wants and limited resources.
Answer: A
Diff: 1 Type: MC
Topic: Definition of Economics
2) Who does scarcity confront?
Scarcity confronts
A) countries but not individuals.
B) low-income families but not high-income families.
C) the private sector but not the government.
D) all living things.
E) individuals but not countries.
Answer: D
Diff: 1 Type: MC
Topic: Definition of Economics
3) Which of the following sentences is consistent with scarcity?
A) We have enough time, but we want more money.
B) If you are content owning few possessions, you'll never face scarcity.
C) We can't afford everything we want, so we must make choices among alternatives.
D) Billionaires can afford anything they want, so they don't face scarcity.
E) If you can afford housing and food, you don't face scarcity.
Answer: C
Diff: 2 Type: MC
Topic: Definition of Economics
1
,4) In the following situations, who faces scarcity?
Latesha chooses to study Engineering at Western instead of studying Math at Waterloo.
Roz decides to go to Western, but all her friends from high school are going to Waterloo.
Courtney decides that Western's campus is more attractive than the campus at Waterloo.
A) Only Latesha faces scarcity.
B) Only Roz faces scarcity.
C) Only Latesha and Roz face scarcity.
D) Only Courtney faces scarcity.
E) Latesha, Roz, and Courtney face scarcity.
Answer: C
Diff: 2 Type: MC
Topic: Definition of Economics
5) You want to buy a new pair of jeans. What limits what you can afford to buy?
What you can afford to buy is limited by
A) what you want.
B) the styles available.
C) the brand of jeans that your friends are wearing.
D) how many pairs of jeans you own.
E) your income and the price you must pay.
Answer: E
Diff: 1 Type: MC
Topic: Definition of Economics
6) Do you face scarcity when you are on vacation?
A) No because you have no deadlines to meet when you are on vacation.
B) Yes because even vacation days have only 24 hours.
C) No because you can do what you want when you are on vacation.
D) Yes because it's difficult to know if you made the right choice of destination.
E) No because your choice of vacation activities is almost infinite.
Answer: B
Diff: 2 Type: MC
Topic: Definition of Economics
7) What is something you want that only the government can provide?
A) clean air
B) affordable food prices
C) education
D) art galleries and museums
E) housing
Answer: A
Diff: 1 Type: MC
Topic: Definition of Economics
2
,8) Can government taxes change choices or decisions?
A) A government makes its spending decisions without regard to the tax revenue it will collect.
B) People make purchasing decisions based on the price of a good and don't consider the sales
tax.
C) Government choices are limited by the taxes they collect, and people's choices are limited by
the taxes they pay.
D) Household choices are limited by the taxes they pay, but business choices are not.
E) Taxes don't limit the choices of low-income households because they pay low taxes.
Answer: C
Diff: 1 Type: MC
Topic: Definition of Economics
9) Are the choices of society limited?
The choices of society
A) aren't limited because human ingenuity can produce anything.
B) are limited by the productive resources available.
C) are limited by the amount of money available.
D) aren't limited because the world has infinite productive resources.
E) aren't limited because of unending technological advances.
Answer: B
Diff: 1 Type: MC
Topic: Definition of Economics
10) What is an incentive?
An incentive is a
A) penalty that leads society to act to eliminate scarcity.
B) reward that encourages equal sharing of resources.
C) reward that encourages an action or a penalty that discourages one.
D) reward that encourages the self-interest but not the social interest.
E) penalty that discourages the social interest but not the self-interest.
Answer: C
Diff: 1 Type: MC
Topic: Definition of Economics
11) Which of the following options describes a choice arising from an incentive?
________ is an incentive that ________.
A) The appearance of spring flowers; announces the beginning of spring
B) Frequent hurricanes; discourages seniors from living in Florida
C) Global warming; discourages global carbon limits
D) A fall in the price of insulin; increases the number of Canadians with diabetes
E) An increase in the gasoline tax; encourages more driving for pleasure
Answer: B
Diff: 2 Type: MC
Topic: Definition of Economics
3
, 12) Fewer avocadoes are offered for sale than people want to buy, and grocery stores
frequently run out. What incentive could grocery stores use to make the choices of buyers
and sellers consistent?
Grocery stores could
A) raise the price of avocadoes.
B) place a tax on avocadoes.
C) stop selling avocadoes.
D) move the avocado display to the front of the store.
E) advertise the health benefits of avocadoes.
Answer: A
Diff: 2 Type: MC
Topic: Definition of Economics
13) What decisions or choices does economics study?
Economics studies
A) production decisions made by businesses but not consumption decisions made by individuals.
B) decisions made by governments as they cope with scarcity but not decisions made by
businesses.
C) decisions made by businesses as they cope with scarcity but not decisions made by
governments.
D) how individuals, businesses, governments, and entire societies made choices to cope with
scarcity.
E) decisions made by wealthy people but not the decisions of low-income people.
Answer: D
Diff: 1 Type: MC
Topic: Definition of Economics
14) Which of the following news headlines describes a topic that economics studies?
A) Federal Election Called for October
B) Celebrity Activists Speak Out Against Climate Change
C) Climate Change Protestors Gather on Parliament Hill
D) Government Introduces Carbon Tax to Fight Climate Change
E) Climate Change Activism on University Campuses
Answer: D
Diff: 2 Type: MC
Topic: Definition of Economics
15) Which of the following options asks a microeconomic question?
A) Why do Canadians buy less honey when the price rises?
B) Why is Canada's inflation rate rising?
C) What is creating Canada's rising unemployment?
D) Why is the Bank of Canada raising interest rates?
E) Why do some Canadians work part time and others full time?
Answer: A
Diff: 2 Type: MC
Topic: Definition of Economics
4
