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Microeconomics: Canada in the Global Environment - CH 01 What is Economics - Test Bank.pdf

52 Pages
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Department
Economics
Course Code
ECON 1050
Professor
Pat Martin

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CH 01What is Economics1In a world characterized by scarcityAall goods are freeBindividuals need not work to obtain goodsCopportunity cost is zeroDwe are not limited by timeEpeople must make choices among alternatives2Which of the following is the best definition of economicsAThe study of how consumers spend their incomeBThe study of how a provincial government allocates tax dollarsCThe study of how producers decide what inputs to hire and what outputs to produceDThe study of how individuals businesses governments and entire societies make choices as they cope with scarcityand the incentives that influence and reconcile those choices EThe study of how consumers and producers meet each other at the market3Which of the following is a microeconomic topicAthe effect of the government budget deficit on inflationBthe reasons why the labour force in a country decreasesCthe reasons why the average price level in a country fallsDthe reasons why a consumer buys less honeyEthe cause of increasing unemployment4The study of how wages are set for New Brunswick teachers is classified asAeconomics of private interestBnormative economicsCa microeconomic topicDa macroeconomic topicEeconomics of social interest5Which of the following newspaper headlines concerns a macroeconomic issueAWhy do grain producers purchase less pesticidesBWhy are people buying more SUVs and fewer minivansCHow would a tax on ecommerce affect chaptersindigocaDHow would an unexpected freeze in Oxford Nova Scotia change the price of blueberries in the MaritimesEWhy is Japans economy stagnant6The branch of economics that studies the choices of individuals and businesses isAmacroeconomicsBmicroeconomicsCpositive economicsDsocial economicsEnormative economics7Each of the following would be considered a macroeconomic topic exceptAthe selection of production techniquesBthe cause of recessionsCthe effect of the government budget deficit on inflationDthe reasons for a decrease in the unemployment rateEthe determination of aggregate income1 CH 01What is Economics8Complete the following sentence MacroeconomicsAdeals mainly with the economic behaviour of householdsBis the study of the national economy and the global economyCis the only part of economics to deal with government decisionsDis primarily concerned with the behaviour of the stock marketEis primarily concerned with the operation of individual markets in the economy9The determination of prices in individual markets is primarily a concern ofAmicroeconomicsBpositive economicsCdescriptive economicsDnegative economicsEmacroeconomics10Which one of the following topics does macroeconomics studyAeffects of taxes on the price of gasolineBeffects of government safety regulations on the price of carsCprices of individual goods and servicesDdecisions of individual firmsEthe performance of the global economy11Which one of the following topics does microeconomics studyAeffect of the government budget deficit on employmentBreasons for a fall in the price of orange juiceCthe effect of a rise in the Canadian dollar on Canadas exportsDeffect of interest rates on national economic growthEdetermination of total production in a country12Complete the following sentence Microeconomics isAthe branch of economics that studies the choices of individuals and businessesBnot concerned with factors of productionCconcerned with normative issues onlyDconcerned with the size of the total amount of income earned by all households in an economyEconcerned exclusively with the role of the government in the economy13Which of the following would be considered a microeconomic topicAthe cause of unemployment in the economyBthe determination of aggregate incomeCthe effect of the government budget deficit on inflationDthe severity of a recessionEthe study of how wages are set for mine workers14The branch of economics that studies the national economy and the global economy isAKeynesian economicsBmacroeconomicsCnormative economicsDmicroeconomicsEpositive economics15The fact that human wants cannot be fully satisfied with available resources is called the problem ofAmarginal costBnormative economicsCscarcityDopportunity costEthe big tradeoff2 CH 01What is Economics16The problem of scarcity existsAin all economiesBonly when people are unemployedCnow but will be eliminated with economic growthDonly in economies that lack incentivesEonly in economies that have incentives17The inescapable economic fact is thatAcapitalists are always exploiting the workersBthere are unlimited wants and limited resourcesCcapitalists and unions cannot work togetherDthere are unlimited resources and we just have to figure out how to allocate themEunions are always exploiting firms18The two big economic questionsAdo not arise from scarcityBinvolve selfinterest onlyCinvolve neither selfinterest nor social interestDinvolve both selfinterest and social interestEinvolve only social interest19The two big economic questionsAhave nothing to do with goods and servicesBhave nothing to do with the way goods and services are producedCdo not consider for whom goods and services are producedDare what goods and services are produced and how are goods and services producedEsummarize the scope of economics20The two big economic questions include all of the following exceptAwhy to produceBfor whom to produceCwhat to produceDcan choices made in the pursuit of selfinterest also promote the social interestEhow to produce21When a firm decides to produce more hybrid cars and fewer gas guzzlers it is answering thequestionAwhatBhowCwhoDwhenEwhere22When a textile firm decides to produce more silk fabric and less cotton fabric it is answering thequestionAwhatBwhoCwhenDwhereEhow3
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