,Principles of Microeconomics, 9e - Test Item File 2 (Case/Fair/Oster)
Chapter 1 The Scope and Method of Economics
1.1 Why Study Economics?
1 Multiple Choice
1) The!!reasons to study economics include which of the following?
F F F F F F F F
A) to be an informed voter
F F F F
B) to understand society and global affairs
F F F F F
C) to learn a way of thinking
F F F F F
D) all of the above
F F F F
Answer: D F
Diff: 1
Topic: Why Study Economics?
Skill: Fact
2) Marginalism is F
A) the best alternative that we forego when making a decision.
F F F F F F F F F
B) the study of how societies choose to use scarce resources.
F F F F F F F F F
C) a market situation in which profit opportunities are eliminated almost instantaneously.
F F F F F F F F F F
D) the process of analyzing the additional costs or benefits arising from a decision.
F F F F F F F F F F F F F
Answer: D F
Diff: 1
Topic: Why Study Economics?
Skill: Definition
3) Economics is best defined as the study of
F F F F F F F
A) financial decision-making. F
B) how consumers make purchasing decisions.
F F F F
C) choices made by people faced with scarcity.
F F F F F F
D) inflation, unemployment, and economic growth.
F F F F F
Answer: C F
Diff: 2
Topic: Why Study Economics?
Skill: Definition
4) The Industrial Revolution refers to the rise of the modern factory system in
F F F F F F F F F F F F F
during
the late eighteenth and early nineteenth centuries.
F F F F F F F
A) the United States
F F
B) England
C) France
D) Germany
F Answer: B F F
Diff: 1
Topic: Why Study Economics?
Skill: Fact
,5) Which of the following statements is correct?
F F F F F F
A) Economics is a natural science. F F F F
B) In large measure, economics is the study of how people make choices.
F F F F F F F F F F F
C) If poverty was eliminated there would be no reason to study economics.
F F F F F F F F F F F
D) Economic analysis can be used to explain how societies, but not individuals, make
F F F F F F F F F F F F F
decisions.
Answer: B F
Diff: 1
Topic: Why Study Economics?
Skill: Fact
6) Economics is the study of F F F F
A) how to invest in the stock market.
F F F F F F
B) how society uses limited resources.
F F F F
C) the role of money in markets.
F F F F F
D) how government officials decide which goods and services are produced.
F F F F F F F F F F
Answer: B F
Diff: 2
Topic: Why Study Economics?
Skill: Definition
7) Costs that cannot be avoided, because they have already been incurred are known as
F F F F F F F F F F F F F
A) differential costs. F
B) marginal costs. F
C) opportunity costs. F
D) sunk F
costs. Answer:
F F
D
Diff: 2
Topic: Why Study Economics?
Skill: Definition
8) Suppose that two weeks ago you purchased a ticket to the symphony for $40. Last week
F F F F F F F F F F F F F F F F
someone invited you to go camping on the same night as the symphony concert. You would
F F F F F F F F F F F F F F F F
much rather go camping than go to the symphony. You have tried unsuccessfully to sell the
F F F F F F F F F F F F F F F F
symphony concert ticket. Which of the following statements regarding this situation is
F F F F F F F F F F F F
correct?
A) The $40 symphony ticket should be irrelevant in your decision making, because it
F F F F F F F F F F F F F
represents the marginal cost of going camping. F F F F F F
B) The $40 you paid for the symphony ticket should be irrelevant in your decision
F F F F F F F F F F F F F F
making, because it is a sunk cost. F F F F F F
C) The $40 you paid for the symphony ticket is relevant to the decision, as this represents
F F F F F F F F F F F F F F F F
the opportunity cost of going camping.
F F F F F
D) You should base your decision on whether or not going camping will provide you with
F F F F F F F F F F F F F F F
more than $40 in satisfaction.
F F F F
Answer: B F
Diff: 2
Topic: Why Study Economics?
Skill: Conceptual
AACSB: Reflective Thinking
, 9) You have decided that you want to attend a renaissance fair as King Henry VIII. You
F F F F F F F F F F F F F F F F
estimate that it will cost $80 to assemble your costume. After spending $80 on the costume,
F F F F F F F F F F F F F F F F
you realize that the additional pieces you need will cost you $20 more. The marginal cost of
F F F F F F F F F F F F F F F F F
completing the costume is F F F
A) $20.
B) $60.
C) $80.
D) $100.
Answer: A F
Diff: 2
Topic: Why Study Economics?
Skill: Analytic
AACSB: Analytic Skills
10) The concept of opportunity cost can be applied to the analysis of
F F F F F F F F F F F F decision-
making processes.
F
A) only economy-wide F
B) only global F
C) only-small-scale
D) any F
Answer: D F F
Diff: 2
Topic: Why Study Economics?
Skill: Conceptual
AACSB: Reflective Thinking
11) That which we forgo, or give up, when we make a choice or a decision is known as
F F F F F F F F F F F F F F F F F
A) equity.
B) causation.
C) correlation.
D) opportunity F
cost. Answer: D
F F
Diff: 2
Topic: Why Study Economics?
Skill: Definition
12) Scarce resources give rise to the concept of
F F F F F F F
A) efficient markets. F
B) opportunity costs. F
C) laissez-faire.
D) positive F
economics. Answer: B F F
Diff: 1
Topic: Why Study Economics?
Skill: Fact
Chapter 1 The Scope and Method of Economics
1.1 Why Study Economics?
1 Multiple Choice
1) The!!reasons to study economics include which of the following?
F F F F F F F F
A) to be an informed voter
F F F F
B) to understand society and global affairs
F F F F F
C) to learn a way of thinking
F F F F F
D) all of the above
F F F F
Answer: D F
Diff: 1
Topic: Why Study Economics?
Skill: Fact
2) Marginalism is F
A) the best alternative that we forego when making a decision.
F F F F F F F F F
B) the study of how societies choose to use scarce resources.
F F F F F F F F F
C) a market situation in which profit opportunities are eliminated almost instantaneously.
F F F F F F F F F F
D) the process of analyzing the additional costs or benefits arising from a decision.
F F F F F F F F F F F F F
Answer: D F
Diff: 1
Topic: Why Study Economics?
Skill: Definition
3) Economics is best defined as the study of
F F F F F F F
A) financial decision-making. F
B) how consumers make purchasing decisions.
F F F F
C) choices made by people faced with scarcity.
F F F F F F
D) inflation, unemployment, and economic growth.
F F F F F
Answer: C F
Diff: 2
Topic: Why Study Economics?
Skill: Definition
4) The Industrial Revolution refers to the rise of the modern factory system in
F F F F F F F F F F F F F
during
the late eighteenth and early nineteenth centuries.
F F F F F F F
A) the United States
F F
B) England
C) France
D) Germany
F Answer: B F F
Diff: 1
Topic: Why Study Economics?
Skill: Fact
,5) Which of the following statements is correct?
F F F F F F
A) Economics is a natural science. F F F F
B) In large measure, economics is the study of how people make choices.
F F F F F F F F F F F
C) If poverty was eliminated there would be no reason to study economics.
F F F F F F F F F F F
D) Economic analysis can be used to explain how societies, but not individuals, make
F F F F F F F F F F F F F
decisions.
Answer: B F
Diff: 1
Topic: Why Study Economics?
Skill: Fact
6) Economics is the study of F F F F
A) how to invest in the stock market.
F F F F F F
B) how society uses limited resources.
F F F F
C) the role of money in markets.
F F F F F
D) how government officials decide which goods and services are produced.
F F F F F F F F F F
Answer: B F
Diff: 2
Topic: Why Study Economics?
Skill: Definition
7) Costs that cannot be avoided, because they have already been incurred are known as
F F F F F F F F F F F F F
A) differential costs. F
B) marginal costs. F
C) opportunity costs. F
D) sunk F
costs. Answer:
F F
D
Diff: 2
Topic: Why Study Economics?
Skill: Definition
8) Suppose that two weeks ago you purchased a ticket to the symphony for $40. Last week
F F F F F F F F F F F F F F F F
someone invited you to go camping on the same night as the symphony concert. You would
F F F F F F F F F F F F F F F F
much rather go camping than go to the symphony. You have tried unsuccessfully to sell the
F F F F F F F F F F F F F F F F
symphony concert ticket. Which of the following statements regarding this situation is
F F F F F F F F F F F F
correct?
A) The $40 symphony ticket should be irrelevant in your decision making, because it
F F F F F F F F F F F F F
represents the marginal cost of going camping. F F F F F F
B) The $40 you paid for the symphony ticket should be irrelevant in your decision
F F F F F F F F F F F F F F
making, because it is a sunk cost. F F F F F F
C) The $40 you paid for the symphony ticket is relevant to the decision, as this represents
F F F F F F F F F F F F F F F F
the opportunity cost of going camping.
F F F F F
D) You should base your decision on whether or not going camping will provide you with
F F F F F F F F F F F F F F F
more than $40 in satisfaction.
F F F F
Answer: B F
Diff: 2
Topic: Why Study Economics?
Skill: Conceptual
AACSB: Reflective Thinking
, 9) You have decided that you want to attend a renaissance fair as King Henry VIII. You
F F F F F F F F F F F F F F F F
estimate that it will cost $80 to assemble your costume. After spending $80 on the costume,
F F F F F F F F F F F F F F F F
you realize that the additional pieces you need will cost you $20 more. The marginal cost of
F F F F F F F F F F F F F F F F F
completing the costume is F F F
A) $20.
B) $60.
C) $80.
D) $100.
Answer: A F
Diff: 2
Topic: Why Study Economics?
Skill: Analytic
AACSB: Analytic Skills
10) The concept of opportunity cost can be applied to the analysis of
F F F F F F F F F F F F decision-
making processes.
F
A) only economy-wide F
B) only global F
C) only-small-scale
D) any F
Answer: D F F
Diff: 2
Topic: Why Study Economics?
Skill: Conceptual
AACSB: Reflective Thinking
11) That which we forgo, or give up, when we make a choice or a decision is known as
F F F F F F F F F F F F F F F F F
A) equity.
B) causation.
C) correlation.
D) opportunity F
cost. Answer: D
F F
Diff: 2
Topic: Why Study Economics?
Skill: Definition
12) Scarce resources give rise to the concept of
F F F F F F F
A) efficient markets. F
B) opportunity costs. F
C) laissez-faire.
D) positive F
economics. Answer: B F F
Diff: 1
Topic: Why Study Economics?
Skill: Fact
