1. Microeconomics deals with:
A) the working of the entire economy or large sectors of it.
B) economic growth.
C) individual decision makers in the economy.
D) gross domestic product.
2. The study of a single firm and how it determines prices falls under
the study of:
A) macroeconomics.
B) microeconomics.
C) economic growth.
D) fiscal policy.
3. Macroeconomics deals with:
A) bits and pieces of the economy.
B) how a business unit should operate profitably.
C) the working of the entire economy or large sectors of it.
D) how individuals make decisions.
4. The primary emphasis in macroeconomics is on:
A) how firms set prices.
B) the national economy.
C) marginal analysis.
D) bits and pieces of the economy.
5. Which of the following is studied in macroeconomics?
A) the change in automobile sales due to a change in the price of
automobiles
B) the effect of a tax reduction on the profits of an individual
business
C) recessions
D) the unemployment of workers displaced by technological change
in the typesetting industry
Page 1
, 6. The basic concern of microeconomics is:
A) to keep business firms from losing money.
B) to prove that capitalism is better than socialism.
C) to study the choices people make.
D) to use unlimited resources to produce goods and services to
satisfy limited wants.
7. How people choose among the alternatives available to them is:
A) not part of the study of economics.
B) impossible to describe.
C) the study of microeconomics.
D) not important in the study of microeconomics.
8. Scarcity in economics means that:
A) we do not have sufficient resources to produce all of the goods
and services we want.
B) the wants of people are limited.
C) there must be poor people in rich countries.
D) shortages exist in nearly all markets.
9. If resources are scarce, it means that they:
A) are insufficient to provide enough goods and services to satisfy
all human material wants and needs.
B) have no opportunity cost.
C) are probably not valued by consumers.
D) have an unlimited supply.
10. A key theme fundamental to all of economics is that:
A) wants are limited.
B) the United States is a rich country, but we are simply not aware
of it.
C) people have unlimited wants but limited means to satisfy them.
D) resources are unlimited.
Page 2
,11. The problem of scarcity is confronted by:
A) industrialized societies only.
B) preindustrial societies only.
C) societies governed by communist philosophies only.
D) all societies.
12. When we are forced to make choices, we are facing the concept of:
A) human capital.
B) inflation.
C) scarcity.
D) market failure.
13. We are forced to make choices because of:
A) exploitation.
B) efficiency.
C) scarcity.
D) the margin.
14. Scarcity exists when:
A) making choices among two or more alternatives is not
necessary.
B) individuals can have more of any good without giving up
anything.
C) individuals can have more of one good but only by giving up
something else.
D) resources are unlimited.
15. Scarcity in economics means that:
A) we do not have sufficient resources to produce all of the goods
and services we want.
B) the wants of people are limited.
C) there must be poor people in rich countries.
D) economists are clearly not doing their job.
Page 3
, 16. Although freshwater is very abundant in most places, it is scarce
because:
A) it has no alternative uses.
B) there is not enough of it to meet all needs.
C) it is a free good.
D) scarce goods in general are not all that costly.
17. Freshwater is considered a scarce good because:
A) not enough of it is available for all needs.
B) it does not have any uses.
C) scarce goods are not expensive.
D) not enough of it is available for all needs and because it is not
expensive.
18. The problem of determining what goods and services society should
produce:
A) exists because we can produce more than we need or want.
B) exists because there are not enough resources to provide all of
the goods and services that people want.
C) would not exist if all goods and services were scarce.
D) would not exist if government owned all of the resources.
19. Which of the following is NOT a resource in the production of rice?
A) fertile land
B) labor
C) capital equipment
D) money
20. A resource is anything that:
A) can be used in production.
B) you pay for.
C) is in scarce supply.
D) can be consumed.
Page 4
A) the working of the entire economy or large sectors of it.
B) economic growth.
C) individual decision makers in the economy.
D) gross domestic product.
2. The study of a single firm and how it determines prices falls under
the study of:
A) macroeconomics.
B) microeconomics.
C) economic growth.
D) fiscal policy.
3. Macroeconomics deals with:
A) bits and pieces of the economy.
B) how a business unit should operate profitably.
C) the working of the entire economy or large sectors of it.
D) how individuals make decisions.
4. The primary emphasis in macroeconomics is on:
A) how firms set prices.
B) the national economy.
C) marginal analysis.
D) bits and pieces of the economy.
5. Which of the following is studied in macroeconomics?
A) the change in automobile sales due to a change in the price of
automobiles
B) the effect of a tax reduction on the profits of an individual
business
C) recessions
D) the unemployment of workers displaced by technological change
in the typesetting industry
Page 1
, 6. The basic concern of microeconomics is:
A) to keep business firms from losing money.
B) to prove that capitalism is better than socialism.
C) to study the choices people make.
D) to use unlimited resources to produce goods and services to
satisfy limited wants.
7. How people choose among the alternatives available to them is:
A) not part of the study of economics.
B) impossible to describe.
C) the study of microeconomics.
D) not important in the study of microeconomics.
8. Scarcity in economics means that:
A) we do not have sufficient resources to produce all of the goods
and services we want.
B) the wants of people are limited.
C) there must be poor people in rich countries.
D) shortages exist in nearly all markets.
9. If resources are scarce, it means that they:
A) are insufficient to provide enough goods and services to satisfy
all human material wants and needs.
B) have no opportunity cost.
C) are probably not valued by consumers.
D) have an unlimited supply.
10. A key theme fundamental to all of economics is that:
A) wants are limited.
B) the United States is a rich country, but we are simply not aware
of it.
C) people have unlimited wants but limited means to satisfy them.
D) resources are unlimited.
Page 2
,11. The problem of scarcity is confronted by:
A) industrialized societies only.
B) preindustrial societies only.
C) societies governed by communist philosophies only.
D) all societies.
12. When we are forced to make choices, we are facing the concept of:
A) human capital.
B) inflation.
C) scarcity.
D) market failure.
13. We are forced to make choices because of:
A) exploitation.
B) efficiency.
C) scarcity.
D) the margin.
14. Scarcity exists when:
A) making choices among two or more alternatives is not
necessary.
B) individuals can have more of any good without giving up
anything.
C) individuals can have more of one good but only by giving up
something else.
D) resources are unlimited.
15. Scarcity in economics means that:
A) we do not have sufficient resources to produce all of the goods
and services we want.
B) the wants of people are limited.
C) there must be poor people in rich countries.
D) economists are clearly not doing their job.
Page 3
, 16. Although freshwater is very abundant in most places, it is scarce
because:
A) it has no alternative uses.
B) there is not enough of it to meet all needs.
C) it is a free good.
D) scarce goods in general are not all that costly.
17. Freshwater is considered a scarce good because:
A) not enough of it is available for all needs.
B) it does not have any uses.
C) scarce goods are not expensive.
D) not enough of it is available for all needs and because it is not
expensive.
18. The problem of determining what goods and services society should
produce:
A) exists because we can produce more than we need or want.
B) exists because there are not enough resources to provide all of
the goods and services that people want.
C) would not exist if all goods and services were scarce.
D) would not exist if government owned all of the resources.
19. Which of the following is NOT a resource in the production of rice?
A) fertile land
B) labor
C) capital equipment
D) money
20. A resource is anything that:
A) can be used in production.
B) you pay for.
C) is in scarce supply.
D) can be consumed.
Page 4
