TEST BANK FOR MICROECONO
l l l
MICS PRINCIPLES FOR ACHAN
l l l l
GINGWORLD, 5THEDITION, ERI
l l l l
C CHIANG
l
,Indicatelthelanswerlchoicelthatlbestlcompleteslthelstatementlorlanswerslthelquestion.
1. Ceterislparibuslmeans
a. everythinglchanges.
b. everythinglislheldlconstant.
c. otherlthingslbeinglequal.
d. nothinglchanges.
2. Whenleconomistslsaylthatlalllsocietieslfacelscarcity,ltheylareldescribing
a. freellunches.
b. unlimitedlresources.
c. unlimitedlwants.
d. tradeoffslsocietieslmustlmake.
3. Stylizedleconomiclmodelslmustlinclude
a. assumptions.
b. inflation.
c. money.
d. complexity.
4. Timelserieslgraphs
a. showldatalthatlcanlbelsplitlintolpercentageslthat,lwhenlcombined,lmakeluplthelwhole.
b. showlthelrelativelimportanceloflsomelvariable'slcomponentslaslalshareloflthelwhole.
c. includelthelvalueloflalvariablelonlthelhorizontallaxislandlminutes,lhours,ldays,lmonths,lquarters,lorlyearsl
onlthelverticallaxis.
d. includelthelvalueloflalvariablelonlthelverticallaxislandlminutes,lhours,ldays,lmonths,lquarters,lorlyearsl
onlthelhorizontallaxis.
5. SupposelMikelhaslthreelhourslofltimeltolspendlsolhelrankslthelfollowinglactivitieslinlorderloflpriority:l(1)lseelalmovi
e,l(2)lattendlalballlgame,l(3)lstudyleconomics.lAssumelthatleachlactivityltakeslthreelhours.lWhatlislMike'slopportunit
ylcostloflseeinglalmovie?
a. attendinglalballlgamelandlstudyingleconomics
b. studyingleconomics
c. attendinglalballlgame
d. eitherlattendinglalballlgamelorlstudyingleconomics
6. Economistsllikeltoluselgraphslandlequationslprimarilylbecause
a. theseltoolslefficientlylexpressleconomiclconcepts.
b. economicslshouldlbeldifficult.
c. mathematicallaptitudelislnecessaryltolunderstandleconomics.
d. theluseloflmathematicslreduceslrigor.
,7. Thelopportunitylcostloflundertakinglanlactivitylisldefinedlaslthe activity.
a. costlforgonelbylnotlundertakinglanother
b. monetarylcostloflundertakinglthat
c. benefitlforgonelbylnotlundertakinglthelnextlbest
d. monetarylbenefitloflundertakinglthat
8. (Figure:lGraphlExamples)lWhichlgraphlislanlexampleloflalbarlchart?
a. graphlA
b. graphlB
c. graphlC
d. graphlD
9. Microeconomicslislconcernedlwithlissueslsuchlas
a. inflation.
b. unemployment.
c. whichljobltoltake.
d. interestlrates.
, 10. Economiclproblemslarelanalyzedlusinglstylizedlmodelslthatlare
a. asldetailedlaslpossible.
b. basedlonlrecentlcaselstudies.
c. verylcomplexlandlmathematical.
d. simplifiedlbylusinglassumptions.
11. Opportunitylcostlinvolveslnonmonetarylcostslratherlthanlmonetarylcosts.
a. True
b. False
12. WhichlstatementlaboutleconomiclmodelslislFALSE?
a. Inlpractice,litlisleasylforlanleconomistltolisolateleconomiclvariables.
b. Economistslholdlalllotherlvariableslconstantlinlorderltolseelthelimpactloflonelparticularlvariable.
c. Economiclmodelslleadltoleconomicltheorieslthatlmustlbeltested.
d. Economiclmodelslarelbuiltlusinglassumptions.
13. Productionlefficiencyloccurslwhenlgoodslare
a. producedlwithlthellowestlpossiblelresourcelcost.
b. allocatedlequallyltolthoselwholpaidlthelmostlforlthem.
c. deliveredltolthoselwholhavelthelgreatestlwillingnesslandlabilityltolacquirelthem.
d. allocatedltolthoselwithlthelgreatestlneed.
14. Alsocietylthatlislableltolproducelgoodslandlserviceslatlthellowestlpossiblelcostlislexperiencing
a. allocativelefficiency.
b. productionlefficiency.
c. opportunitylcosts.
d. scarcity.
15. WhichlstatementlislNOTlconsideredlalkeylprinciplelofleconomics?
a. Scarcitylexistslforleveryone.
b. Peoplelfaceleconomiclincentiveslonlalregularlbasis.
c. Irrationallbehaviorlrequireslthinkinglatlthelmargin.
d. Informationlislimportantltolproducerslandlconsumers.
16. Settinglgovernmentlpolicyltolachieveleconomiclgoalslislchallenginglbecauselpolicieslthatltendltolreducelune
mploymentlarellikelylto
a. reduceleconomiclgrowth.
b. causelupwardlpressurelonlinflation.
c. belcompletelylineffectivelinlthelshortlrun.
d. reducelinflationltolnearlylzero.
17. Thelhighestlvaluedlalternativelthatlislforgonelwhenl youlchooselanlactionlislcalledlits
a. opportunitylcost.
b. utility.
l l l
MICS PRINCIPLES FOR ACHAN
l l l l
GINGWORLD, 5THEDITION, ERI
l l l l
C CHIANG
l
,Indicatelthelanswerlchoicelthatlbestlcompleteslthelstatementlorlanswerslthelquestion.
1. Ceterislparibuslmeans
a. everythinglchanges.
b. everythinglislheldlconstant.
c. otherlthingslbeinglequal.
d. nothinglchanges.
2. Whenleconomistslsaylthatlalllsocietieslfacelscarcity,ltheylareldescribing
a. freellunches.
b. unlimitedlresources.
c. unlimitedlwants.
d. tradeoffslsocietieslmustlmake.
3. Stylizedleconomiclmodelslmustlinclude
a. assumptions.
b. inflation.
c. money.
d. complexity.
4. Timelserieslgraphs
a. showldatalthatlcanlbelsplitlintolpercentageslthat,lwhenlcombined,lmakeluplthelwhole.
b. showlthelrelativelimportanceloflsomelvariable'slcomponentslaslalshareloflthelwhole.
c. includelthelvalueloflalvariablelonlthelhorizontallaxislandlminutes,lhours,ldays,lmonths,lquarters,lorlyearsl
onlthelverticallaxis.
d. includelthelvalueloflalvariablelonlthelverticallaxislandlminutes,lhours,ldays,lmonths,lquarters,lorlyearsl
onlthelhorizontallaxis.
5. SupposelMikelhaslthreelhourslofltimeltolspendlsolhelrankslthelfollowinglactivitieslinlorderloflpriority:l(1)lseelalmovi
e,l(2)lattendlalballlgame,l(3)lstudyleconomics.lAssumelthatleachlactivityltakeslthreelhours.lWhatlislMike'slopportunit
ylcostloflseeinglalmovie?
a. attendinglalballlgamelandlstudyingleconomics
b. studyingleconomics
c. attendinglalballlgame
d. eitherlattendinglalballlgamelorlstudyingleconomics
6. Economistsllikeltoluselgraphslandlequationslprimarilylbecause
a. theseltoolslefficientlylexpressleconomiclconcepts.
b. economicslshouldlbeldifficult.
c. mathematicallaptitudelislnecessaryltolunderstandleconomics.
d. theluseloflmathematicslreduceslrigor.
,7. Thelopportunitylcostloflundertakinglanlactivitylisldefinedlaslthe activity.
a. costlforgonelbylnotlundertakinglanother
b. monetarylcostloflundertakinglthat
c. benefitlforgonelbylnotlundertakinglthelnextlbest
d. monetarylbenefitloflundertakinglthat
8. (Figure:lGraphlExamples)lWhichlgraphlislanlexampleloflalbarlchart?
a. graphlA
b. graphlB
c. graphlC
d. graphlD
9. Microeconomicslislconcernedlwithlissueslsuchlas
a. inflation.
b. unemployment.
c. whichljobltoltake.
d. interestlrates.
, 10. Economiclproblemslarelanalyzedlusinglstylizedlmodelslthatlare
a. asldetailedlaslpossible.
b. basedlonlrecentlcaselstudies.
c. verylcomplexlandlmathematical.
d. simplifiedlbylusinglassumptions.
11. Opportunitylcostlinvolveslnonmonetarylcostslratherlthanlmonetarylcosts.
a. True
b. False
12. WhichlstatementlaboutleconomiclmodelslislFALSE?
a. Inlpractice,litlisleasylforlanleconomistltolisolateleconomiclvariables.
b. Economistslholdlalllotherlvariableslconstantlinlorderltolseelthelimpactloflonelparticularlvariable.
c. Economiclmodelslleadltoleconomicltheorieslthatlmustlbeltested.
d. Economiclmodelslarelbuiltlusinglassumptions.
13. Productionlefficiencyloccurslwhenlgoodslare
a. producedlwithlthellowestlpossiblelresourcelcost.
b. allocatedlequallyltolthoselwholpaidlthelmostlforlthem.
c. deliveredltolthoselwholhavelthelgreatestlwillingnesslandlabilityltolacquirelthem.
d. allocatedltolthoselwithlthelgreatestlneed.
14. Alsocietylthatlislableltolproducelgoodslandlserviceslatlthellowestlpossiblelcostlislexperiencing
a. allocativelefficiency.
b. productionlefficiency.
c. opportunitylcosts.
d. scarcity.
15. WhichlstatementlislNOTlconsideredlalkeylprinciplelofleconomics?
a. Scarcitylexistslforleveryone.
b. Peoplelfaceleconomiclincentiveslonlalregularlbasis.
c. Irrationallbehaviorlrequireslthinkinglatlthelmargin.
d. Informationlislimportantltolproducerslandlconsumers.
16. Settinglgovernmentlpolicyltolachieveleconomiclgoalslislchallenginglbecauselpolicieslthatltendltolreducelune
mploymentlarellikelylto
a. reduceleconomiclgrowth.
b. causelupwardlpressurelonlinflation.
c. belcompletelylineffectivelinlthelshortlrun.
d. reducelinflationltolnearlylzero.
17. Thelhighestlvaluedlalternativelthatlislforgonelwhenl youlchooselanlactionlislcalledlits
a. opportunitylcost.
b. utility.
