question

For economists, the word "utility" means

answer

pleasure and satisfaction

question

In economics, the pleasure, happiness, or satisfaction received from a product is called what?

answer

utility

question

When economists say that people act rationally in their self interest, they mean that individuals do what?

answer

look for and pursue opportunities to increase their utility

question

According to Emerson: "Want is a growing giant whom the coat of Have was never large enough to cover." According to economists, "Want" exceeds "Have" because what?

answer

productive resources are limited

question

According to economists, economic self-interest is what?

answer

a reality that underlies economic behavior

question

When entering a building, Sam diverts his path to go through an open door rather than make the physical effort to open the closed door that is directly in his path. This is an example of what?

answer

marginal benefit-marginal cost analysis

question

Joe sold gold coins for $1000 that he bought a year ago for $1000. He says, "At least I didn't lose any money on my financial investment." His economist friend points out that in effect he did lose money, because he could have received a 3 percent return on the $1000 if he had bought a bank certificate of deposit instead of the coins. The economist's analysis in this case incorporates the idea of what?

answer

opportunity costs

question

A person should consume more of something when its marginal means what?

answer

benefit exceeds its marginal cost

question

Economics may best be defined as what?

answer

the social science concerned with how individuals, institutions, and society make optimal choices under conditions of scarcity

question

The study of economics is primarily concerned with what?

answer

choices that are made in seeking the best use of resources

question

The economic perspective refers to what?

answer

the making of purposeful decisions in a context of marginal costs and marginal benefits.

question

what does the economic perspective entail?

answer

a comparison of marginal benefits and marginal costs in decision making

question

What does purposeful behavior suggest?

answer

individuals will make different choices because of different desired outcomes

question

Purposeful behavior means that:

answer

people weigh costs and benefits to make decisions.

question

Economics involves marginal analysis because:

answer

most decisions involve changes from the present situation

question

Why should you decide to go to a movie?

answer

if the marginal benefit of the movie exceeds its marginal cost.

question

Marginal costs exist because:

answer

the decision to engage in one activity means forgoing some other activity.

question

The assertion that "There is no free lunch" means what?

answer

all production involves the use of scarce resources and thus the sacrifice of alternative goods.

question

Consumers spend their incomes to get the maximum benefit or satisfaction from the goods and services they purchase. What is this a reflection of?

answer

purposeful behavior

question

If someone produced too much of a good, this would suggest that:

answer

the good was produced to the point where its marginal cost exceeded its marginal benefit.

question

Even though local newspapers are very inexpensive, people rarely buy more than one of them each day. What does this fact imply?

answer

implies that, for most people, the marginal benefit of reading a second newspaper is less than the marginal cost.

question

In deciding whether to study for an economics quiz or go to a movie, one is confronted by the idea(s) of what?

answer

scarcity and opportunity costs

question

Which one of the following expressions best states the idea of opportunity cost?

answer

"There is no such thing as a free lunch."

question

What is an economic explanation for why most college-aged movie stars do not attend college?

answer

the opportunity cost in terms of reduced income is too great

question

Suppose that a university decides to spend $1 million to upgrade personal computers and scientific equipment for faculty rather than spend $1 million to expand parking for students. This example illustrates what?

answer

Opportunity costs

question

Which of the following most closely relates to the idea of opportunity costs?

answer

tradeoffs

question

Economists contend that most economic decisions are what?

answer

purposeful

question

Alex sees that his neighbors' lawns all need mowing. He offers to provide the service in exchange for a wage of $20 per hour. Some neighbors accept Alex's offer and others refuse. Economists would describe Alex's behavior as:

answer

rational self-interest, because he attempting to increase his own income by identifying and satisfying someone else's wants.

question

Kara was out jogging and despite being tired, decided to run one more mile. Based on her actions, economists would conclude that Kara:

answer

decided that the marginal benefit of running one more mile would outweigh the cost of the additional mile.

question

What are Economic theories?

answer

are generalizations based on a careful observation of facts.

question

In constructing models, what do economists do?

answer

make simplifying assumptions

question

What do Economic models do?

answer

emphasize basic economic relationships by purposefully simplifying the complexities of the real world.

question

What does the term "ceteris paribus" mean?

answer

other things equal

question

What is the basic purpose of the other-things-equal assumption?

answer

allow one to reason about the relationship between variables X and Y without the intrusion of variable Z.

question

Suppose an economist says that "Other things equal, the lower the price of bananas, the greater the amount of bananas purchased." This statement indicates that:

answer

all factors other than the price of bananas (for example, consumer tastes and incomes) are assumed to be constant.

question

The term "other things equal" means that:

answer

a number of relevant variables are assumed to be constant

question

Macroeconomics approaches the study of economics from the viewpoint of:

answer

the entire economy

question

What is associated with macroeconomics?

answer

an empirical investigation of the general price level and unemployment rates since 1990

question

The problems of aggregate inflation and unemployment are:

answer

major topics of macroeconomics.

question

Which of the following statements pertains to macroeconomics? A. Because the minimum wage was raised, Mrs. Olsen decided to enter the labor force. B. A decline in the price of soybeans caused farmer Wanek to plant more land in wheat. C. National income grew by 2.7 percent last year. D. The Pumpkin Center State Bank increased its interest rate on consumer loans by 1 percentage point.

answer

C. National income grew by 2.7 percent last year.

question

What can Macroeconomics best be described as?

answer

study of the large aggregates of the economy or the economy as a whole.

question

What is Microeconomics is concerned with?

answer

a detailed examination of specific economic units that make up the economic system.

question

Microeconomics:

answer

is concerned with individual economic units and specific markets.

question

Which of the following is a macroeconomic statement? A. The gross profits of all U.S. businesses were $182 billion last year. B. The price of beef declined by 3 percent last year. C. General Motors' profits increased last year. D. The productivity of steelworkers increased by 1 percent last year.

answer

A. The gross profits of all U.S. businesses were $182 billion last year.

question

Which of the following is a microeconomic statement? A. The real domestic output increased by 2.5 percent last year. B. Unemployment was 6.8 percent of the labor force last year. C. The price of personal computers declined last year. D. The general price level increased by 4 percent last year.

answer

C. The price of personal computers declined last year.

question

Which of the following statements is true? A. Microeconomics focuses on specific decision-making units of the economy; macroeconomics examines the economy as a whole. B. Macroeconomics focuses on specific decision-making units of the economy; microeconomics examines the economy as a whole. C. Every topic in economics is either a microeconomic or a macroeconomic issue; a topic cannot be both. D. Topics in microeconomics have public policy implications; topics in macroeconomics do not.

answer

A. Microeconomics focuses on specific decision-making units of the economy; macroeconomics examines the economy as a whole.

question

A normative statement is one that:

answer

is based on value judgments.

question

Which of the following is a normative statement? A. The temperature is high today. B. The humidity is high today. C. It is too hot to play tennis today. D. It will cool off later this evening.

answer

C. It is too hot to play tennis today.

question

A positive statement is one that is:

answer

objective and is based on facts.

question

Which of the following is a positive statement? A. The humidity is too high today. B. It is too hot to jog today. C. The temperature is 92 degrees today. D. Summer evenings are nice when it cools off.

answer

C. The temperature is 92 degrees today.

question

What are Normative statements concerned with?

answer

what ought to be.

question

What are Positive statements concerned with?

answer

what is.

question

Most of the disagreement among economists involves:

answer

Normative statements

question

Ben says that "An increase in the tax on beer will raise its price." Holly argues that "Taxes should be increased on beer because college students drink too much." We can conclude that:

answer

Holly's statement is normative, but Ben's is positive.

question

What is the economizing problem?

answer

the need to make choices because economic wants exceed economic means.

question

The economizing problem is one of deciding how to make the best use of:

answer

limited resources to satisfy virtually unlimited wants.

question

When the economist says that economic wants are insatiable, this means that:

answer

these wants are virtually unlimited and therefore incapable of complete satisfaction.

question

Why does the scarcity problem persist?

answer

persists because economic wants exceed available productive resources.

question

The alternative combination of two goods which a consumer can purchase with a given money income is shown by what?

answer

a budget line.

question

What does a budget line show?

answer

all possible combinations of two goods that can be purchased, given money income and the prices of the goods.

question

61. Refer to the budget line shown in the diagram above. If the consumer's money income is $20, the: A. prices of C and D cannot be determined. B. price of C is $2 and the price of D is $4. C. consumer can obtain a combination of 5 units of both C and D. D. price of C is $4 and the price of D is $2.

answer

D. price of C is $4 and the price of D is $2.

question

62. Refer to the budget line shown in the diagram above. If the consumer's money income is $20, which of the following combination of goods is unattainable? A. 4 units of C, and 6 units of D. B. 5 units of C, and no units of D. C. 1 unit of C, and 8 units of D. D. 2 units of C, and 6 units of D.

answer

A. 4 units of C, and 6 units of D.

question

63. Refer to the budget line shown in the diagram above. The absolute value of the slope of the budget line is: A. MUC/MUD. B. one-half. C. PD/PC. D. PC/PD.

answer

D. PC/PD.

question

In moving along a given budget line:

answer

the prices of both products and money income are assumed to be constant.

question

An increase in money income does what?

answer

shifts the consumer's budget line to the right.

question

66. The shift of the budget line from cd to ab in the above figure is consistent with: A. decreases in the prices of both M and N. B. an increase in the price of M and a decrease in the price of N. C. a decrease in money income. D. an increase in money income.

answer

a decrease in money income.

question

Any combination of goods lying outside of the budget line is what?

answer

is unattainable, given the consumer's income.

question

68. Suppose you have a money income of $10, all of which you spend on Coke and popcorn. In the above diagram, the prices of Coke and popcorn respectively are: A. $.50 and $1.00. B. $1.00 and $.50. C. $1.00 and $2.00. D. $.40 and $.50.

answer

A. $.50 and $1.00.

question

A budget line shows the:

answer

alternative combinations of two goods that a consumer can purchase with a given money income.

question

Other things equal, an increase in a consumer's money income does what?

answer

shifts her budget line rightward because she can now purchase more of both products.

question

What does the slope of a budget line reflect?

answer

price ratio of the two products

question

72. Suppose Elroy's budget line is as shown on the above diagram. If his tastes change in favor of Coke and against popcorn, the budget line will:

answer

be unaffected.

question

Assume the price of product Y (the quantity of which is on the vertical axis) is $15 and the price of product X (the quantity of which is on the horizontal axis) is $3. Also assume that money income is $60. The absolute value of the slope of the resulting budget line:

answer

is 1/5.

question

Suppose that Julia receives a $20 gift card for the local coffee shop, where she only buys lattes and muffins. If the price of a latte is $4 and the price of a muffin is $2, then we can conclude that Julia:

answer

can buy 5 lattes or 10 muffins if she chooses to buy only one of the two goods.

question

Which of the following is a land resource? A. a computer programmer B. a computer C. silicon (sand) used to make computer chips D. a piece of software used by a firm

answer

C. silicon (sand) used to make computer chips

question

Which of the following is a labor resource? A. a computer programmer B. a computer C. silicon (sand) used to make computer chips D. a piece of software used by a firm

answer

A. a computer programmer

question

Which of the following is a capital resource? A. a computer programmer B. a corporate bond issued by a computer manufacturer C. silicon (sand) used to make computer chips D. a piece of software used by a firm

answer

D. a piece of software used by a firm

question

The four factors of production are:

answer

land, labor, capital, and entrepreneurial ability

question

Which of the following lists includes only capital resources (and therefore no labor or land resources)? A. an ice arena; a professional hockey player; hockey uniforms. B. the owner of a new startup firm; a chemistry lab; a researcher. C. a hydroelectric dam; water behind the dam; power lines. D. autos owned by a car rental firm; computers at the car rental agency; the vans that shuffle rental customers to and from the airport.

answer

D. autos owned by a car rental firm; computers at the car rental agency; the vans that shuffle rental customers to and from the airport.

question

Why is money not an economic resource?

answer

money, as such, is not productive.

question

Economic resources are also called:

answer

factors of production.

question

Which of the following is real capital? A. a pair of stockings B. a construction crane C. a savings account D. a share of IBM stock

answer

B. a construction crane

question

The main function of the entrepreneur is to:

answer

innovate

question

Which of the following is not a main function of the entrepreneur? A. make routine pricing decisions. B. innovate. C. assume the risk of economic losses. D. makes strategic business decisions.

answer

A. make routine pricing decisions.

question

The production possibilities curve illustrates the basic principle that:

answer

if all the resources of an economy are in use, more of one good can be produced only if less of another good is produced.

question

Which of the following will not produce an outward shift of the production possibilities curve? A. an upgrading of the quality of a nation's human resources B. the reduction of unemployment C. an increase in the quantity of a society's labor force D. the improvement of a society's technological knowledge

answer

B. the reduction of unemployment

question

Unemployment is illustrated by what?

answer

by a point inside the production possibilities curve.

question

If the production possibilities curve is a straight line:

answer

economic resources are perfectly substitutable between the production of the two products.

question

A production possibilities curve illustrates:

answer

Scarcity

question

A production possibilities curve shows:

answer

the maximum amounts of two goods that can be produced assuming the full use of available resources.

question

A nation's production possibilities curve is bowed out from the origin because:

answer

resources are not equally efficient in producing every good.

question

92. Refer to the above table. If the economy is producing at production alternative C, the opportunity cost of the tenth unit of consumer goods will be: A. 4 units of capital goods. B. 2 units of capital goods. C. 3 units of capital goods. D. 1/3 of a unit of capital goods.

answer

D. 1/3 of a unit of capital goods.

question

93. Refer to the above table. As compared to production alternative D, the choice of alternative C would: A. tend to generate a more rapid growth rate. B. be unattainable. C. entail unemployment. D. tend to generate a slower growth rate.

answer

A. tend to generate a more rapid growth rate.

question

94. Refer to the above table. A total output of 3 units of capital goods and 4 units of consumer goods: A. is irrelevant because the economy is capable of producing a larger total output. B. will result in the maximum rate of growth available to this economy. C. would involve an inefficient use of the economy's scarce resources. D. is unobtainable in this economy.

answer

C. would involve an inefficient use of the economy's scarce resources.

question

95. Refer to the above table. For this economy to produce a total output of 3 units of capital goods and 13 units of consumer goods it must: A. achieve economic growth. B. use its resources more efficiently than the data in the table now indicate. C. allocate its available resources most efficiently among alternative uses. D. achieve the full employment of available resources.

answer

A. achieve economic growth.

question

96. Refer to the above table. For these data the law of increasing opportunity costs is reflected in the fact that: A. the amount of consumer goods that must be sacrificed to get more capital goods diminishes beyond a point. B. larger and larger amounts of capital goods must be sacrificed to get additional units of consumer goods. C. the production possibilities data would graph as a straight downsloping line. D. the economy's resources are presumed to be scarce.

answer

B. larger and larger amounts of capital goods must be sacrificed to get additional units of consumer goods.

question

When an economy is operating under conditions of full employment, the production of more of commodity A will mean the production of less of commodity B because:

answer

resources are limited.

question

The production possibilities curve is a frontier between what?

answer

a frontier between all combinations of two goods that can be produced and those combinations that cannot be produced.

question

Assume an economy is operating at some point on its production possibilities curve, which shows civilian and military goods. If the output of military goods is increased, the output of civilian goods:

answer

must be decreased.

question

Any point inside the production possibilities curve indicates:

answer

that more output could be produced with available resources.

question

101. Refer to the above diagram. Other things equal, this economy will achieve the most rapid rate of growth if: A. the ratio of capital to consumer goods is minimized. B. it chooses point C. C. it chooses point B. D. it chooses point A.

answer

D. it chooses point A.

question

102. Refer to the above diagram. This economy will experience unemployment if it produces at point: A. A. B. B. C. C. D. D.

answer

D. D.

question

In drawing the production possibilities curve we assume that:

answer

technology is fixed.

question

Which of the following is assumed in constructing a typical production possibilities curve?

answer

production technology is fixed.

question

If the production possibilities curve were a straight down-sloping line, this would suggest that:

answer

resources are perfectly shiftable between the production of these two goods.

question

Assume an economy is incurring unemployment. The effect of resolving this problem will be to:

answer

move the level of actual output to the economy's production possibilities curve.

question

107. Which of the following is not correct? A typical production possibilities curve: A. indicates how much of two products a society can produce. B. reveals how much each additional unit of one product will cost in terms of the other product. C. specifies how much of each product society should produce. D. indicates that to produce more of one product society must forgo larger and larger amounts of the other product.

answer

C. specifies how much of each product society should produce.

question

A point inside a production possibilities curve best illustrates:

answer

unemployment.

question

109. Refer to the above diagram. This production possibilities curve is constructed so that: A. resources are presumed to be perfectly shiftable between bread and tractors. B. the opportunity cost of bread diminishes as more bread is produced. C. the opportunity cost of tractors increases as more bread is produced. D. the opportunity cost of both bread and tractors increases as more of each is produced.

answer

D. the opportunity cost of both bread and tractors increases as more of each is produced.

question

110. Refer to the above diagram. Starting at point A, the opportunity cost of producing each successive unit of tractors is: A. a constant 2 units of bread. B. 2, 4, 6, and 8 units of bread. C. 8, 6, 4, and 2 units of bread. D. the reciprocal of the output of tractors.

answer

B. 2, 4, 6, and 8 units of bread.

question

111. Refer to the above diagram. Starting at point E, the production of successive units of bread will cost: A. a constant 8 units of tractors. B. a constant 6 units of tractors. C. 1/8, 1/6, 1/4, and 1/2 units of tractors. D. 1/2, 1/4, 1/6, and 1/8 units of tractors.

answer

C. 1/8, 1/6, 1/4, and 1/2 units of tractors.

question

In drawing a production possibilities curve we hold constant:

answer

both technology and resource supplies.

question

The construction of a production possibilities curve assumes:

answer

technology is fixed.

question

If an economy is operating inside its production possibilities curve for consumer goods and capital goods, it:

answer

can produce more of both consumer goods and capital goods by using resources that are currently idle.

question

115. Refer to the above diagram. Points A, B, C, D, and E show: A. that the opportunity cost of bicycles increases, while that of computers is constant. B. combinations of bicycles and computers that society can produce by using its resources efficiently. C. that the opportunity cost of computers increases, while that of bicycles is constant. D. that society's demand for computers is greater than its demand for bicycles.

answer

B. combinations of bicycles and computers that society can produce by using its resources efficiently.

question

116. Refer to the above diagram. This production possibilities curve is: A. convex to the origin because opportunity costs are constant. B. linear because opportunity costs are constant. C. concave to the origin because of increasing opportunity costs. D. convex to the origin because of increasing opportunity costs.

answer

C. concave to the origin because of increasing opportunity costs.

question

117. Refer to the above diagram. If society is currently producing 9 units of bicycles and 4 units of computers and it now decides to increase computer output to 6, the cost: A. will be 4 units of bicycles. B. will be 2 units of bicycles. C. will be zero because unemployed resources are available. D. of doing so cannot be determined from the information given.

answer

A. will be 4 units of bicycles.

question

118. Refer to the above diagram. The combination of computers and bicycles shown by point G is: A. attainable, but too costly. B. unattainable, given currently available resources and technology. C. attainable, but involves unemployment. D. irrelevant because it is inconsistent with consumer preferences.

answer

B. unattainable, given currently available resources and technology.

question

119. Refer to the above diagram. If society is currently producing the combination of bicycles and computers shown by point D, the production of 2 more units of bicycles: A. cannot be achieved because resources are fully employed. B. will cost 1 unit of computers. C. will cost 2 units of computers. D. will cause some resources to become unemployed.

answer

B. will cost 1 unit of computers.

question

120. Refer to the above diagram. The combination of computers and bicycles shown by point F: A. is unattainable, given currently available resources and technology. B. is attainable, but implies that the economy is not using all its resources. C. is irrelevant because it is inconsistent with consumer preferences. D. suggests that opportunity costs are constant.

answer

B. is attainable, but implies that the economy is not using all its resources.

question

121. Refer to the above diagram. The movement down the production possibilities curve from point A to point E suggests that the production of: A. computers, but not bicycles, is subject to increasing opportunity costs. B. bicycles, but not computers, is subject to increasing opportunity costs. C. both bicycles and computers are subject to constant opportunity costs. D. both bicycles and computers are subject to increasing opportunity costs.

answer

D. both bicycles and computers are subject to increasing opportunity costs.

question

The law of increasing opportunity costs states that:

answer

if society wants to produce more of a particular good, it must sacrifice larger and larger amounts of other goods to do so.

question

What does the concept of opportunity cost suggest?

answer

suggests that the use of resources in any particular line of production means that alternative outputs must be forgone.

question

The law of increasing opportunity costs exists because:

answer

resources are not equally efficient in producing various goods.

question

The law of increasing opportunity costs is reflected in a production possibilities curve that is:

answer

concave to the origin.

question

Opportunity cost is best defined as:

answer

the amount of one product that must be given up to produce one more unit of another product.

question

If the output of product X is such that marginal benefit equals marginal cost:

answer

the correct amount of resources is being allocated to X's production.

question

128. Refer to the above diagram for athletic shoes. The optimal output of shoes is: A. Q1. B. Q2. C. Q3. D. greater than Q3.

answer

B. Q2.

question

129. Refer to the above diagram for athletic shoes. If the current output of shoes is Q1, then: A. society would consider additional units of shoes to be more valuable than alternative uses of those resources. B. society would consider additional units of shoes to be less valuable than alternative uses of those resources. C. society would experience a net loss by producing more shoes. D. resources are being allocated efficiently to the production of shoes.

answer

A. society would consider additional units of shoes to be more valuable than alternative uses of those resources.

question

130. Refer to the above diagram for athletic shoes. If the current output of shoes is Q3, then: A. resources are being allocated efficiently to the production of shoes. B. society would consider additional units of shoes to be more valuable than alternative products. C. society would consider additional units of shoes to be less valuable than alternative products. D. society would experience a net gain by producing more shoes.

answer

C. society would consider additional units of shoes to be less valuable than alternative products.

question

131. Refer to the above diagram for athletic shoes. If the current output of shoes is Q3, then: A. society should produce fewer shoes to achieve the optimal allocation of resources. B. society should produce more shoes to achieve the optimal allocation of resources. C. resources are being allocated efficiently to the production of shoes. D. shoes are more valuable to society than alternative products

answer

A. society should produce fewer shoes to achieve the optimal allocation of resources.

question

Suppose that an economy is producing on its production possibilities curve, but is not producing quantities of each good where the marginal benefit equals the marginal cost for each good. How can this economy improve its allocation?

answer

by producing more of one good and less of the other.

question

The optimal allocation of resources is found:

answer

where MB = MC.

question

The basic difference between consumer goods and capital goods is that

answer

consumer goods satisfy wants directly while capital goods satisfy wants indirectly.

question

Which of the following would be most likely to shift the production possibilities curve to the right? A. a sudden and substantial expansion of consumer wants B. an improvement in the literacy level and general level of education C. a decline in the size of the population and labor force D. shifting resources from the production of capital goods to the production of consumer goods

answer

B. an improvement in the literacy level and general level of education

question

Which of the following will shift the production possibilities curve to the right? A. an increase in the unemployment rate from 6 to 8 percent B. a decline in the efficiency with which the present labor force is allocated C. a decrease in the unemployment rate from 8 to 6 percent D. a technological advance that allows farmers to produce more output from given inputs

answer

D. a technological advance that allows farmers to produce more output from given inputs

question

Other things equal, which of the following would shift an economy's production possibilities curve to the left? A. the discovery of a low-cost means of generating and storing solar energy B. the entrance of more women into the labor force C. a law requiring mandatory retirement from the labor force at age 55 D. an increase in the proportion of total output that consists of capital or investment goods

answer

C. a law requiring mandatory retirement from the labor force at age 55

question

138. Refer to the above diagram. The concept of opportunity cost is best represented by the: A. shift of the production possibilities curve from PP1 to PP2. B. move from B on PP1 to E on PP2. C. move from B on PP1 to C on PP1. D. move from D inside PP1 to B on PP1.

answer

C. move from B on PP1 to C on PP1.

question

139. Refer to the above diagram. Which of the following positions relative to PP1 would be the most likely to result in a future production possibilities curve of PP3, rather than PP2? A. A. B. B. C. C. D. D.

answer

A. A.

question

140. Refer to the above diagram. An improvement in technology will: A. shift the production possibilities curve from PP1 to PP2. B. shift the production possibilities curve from PP2 to PP1. C. move the economy from A to C along PP1. D. move the economy from A, B, or C on PP1 to D.

answer

A. shift the production possibilities curve from PP1 to PP2.

question

Which of the following statements, if any, is correct for a nation that is producing only consumer and capital goods?

answer

Other things equal, the more capital goods a nation produces, the greater will be its future growth rate.

question

(Consider This) A direct cost of going to college is: A. tuition, while an indirect cost (opportunity cost) is books and other supplies. B. forgone income while in college, while an indirect cost (opportunity cost) is tuition. C. tuition, while an indirect cost (opportunity cost) is forgone income while in college. D. books and supplies, while an indirect cost (opportunity cost) is food and housing.

answer

C. tuition, while an indirect cost (opportunity cost) is forgone income while in college.

question

(Consider This) An exception to the advice "go to college, stay in college, and earn a degree" occurs when: A. tuition expenses are high and rising. B. the opportunity cost of attending college is extraordinarily high. C. the price of textbooks is high and rising. D. the economy is growing rapidly and jobs are plentiful.

answer

B. the opportunity cost of attending college is extraordinarily high.

question

If we say that two variables are directly related, this means that:

answer

an increase in one variable is associated with an increase in the other variable.

question

If we say that two variables are inversely related, this means that:

answer

an increase in one variable is associated with a decrease in the other.

question

Which of the following statements is correct? A. The value of the independent variable is determined by the value of the dependent variable. B. The value of the dependent variable is determined by the value of the independent variable. C. The dependent variable designates the "cause" and the independent variable the "effect." D. Dependent variables graph as upsloping lines; independent variables graph as downsloping lines.

answer

B. The value of the dependent variable is determined by the value of the independent variable.

question

If two variables are inversely related, then as the value of one variable:

answer

increases, the value of the other decreases.

question

If a positive relationship exists between x and y:

answer

the relationship will graph as an upsloping line.

question

The slope of a straight line can be determined by:

answer

comparing the absolute vertical change to the absolute horizontal change between two points on the line.

question

150. Refer to the above diagram. The variables X and Y are: A. inversely related. B. directly related. C. unrelated. D. negatively related.

answer

B. directly related.

question

151. Refer to the above diagram. The vertical intercept: A. is 40. B. is 50. C. is 60. D. cannot be determined from the information given.

answer

B. is 50.

question

152. Refer to the above diagram. The slope of the line: A. is - 1/4. B. is + 1/4. C. is .40. D. cannot be determined from the information given.

answer

B. is + 1/4.

question

153. Refer to the above diagram. The equation that shows the relationship between Y and X is: A. Y = 50 + 1/4 X. B. X = 1/4Y. C. Y = .4X. D. Y = 1/4 X - 50.

answer

A. Y = 50 + 1/4 X.

question

Assume a household would consume $100 worth of goods and services per week if its weekly income were zero and would spend an additional $80 per week for each $100 of additional income. Letting C represent consumption and Y represent income, the equation that summarizes this relationship is:

answer

C = 100 + .8Y.

question

If the equation y = 5 + 6x was graphed, the slope would be what?

answer

slope would be +6.

question

If the equation y = 15 - 4x was plotted, the slope would be what?

answer

slope would be -4.

question

If the equation y = -10 + 2.5x was plotted: A. the vertical intercept would be -10. B. the slope would be -7.5. C. it would graph as a downsloping line. D. the slope would be -10.

answer

A. the vertical intercept would be -10.

question

158. The movement from line A to line A' represents a change in: A. the slope only. B. the intercept only. C. both the slope and the intercept. D. neither the slope nor the intercept.

answer

B. the intercept only.

question

159. In the above diagram variables x and y are: A. both dependent variables. B. directly related. C. inversely related. D. unrelated.

answer

C. inversely related.

question

160. In the above diagram the vertical intercept and slope are: A. 4 and -1 1/3 respectively. B. 3 and -1 1/3 respectively. C. 3 and + 3/4 respectively. D. 4 and + 3/4 respectively.

answer

A. 4 and -1 1/3 respectively.

question

161. Refer to the above diagram. The slope of curve ZZ at point A is approximately: A. +2. B. +2 1/2. C. -2 1/2. D. +4.

answer

B. +2 1/2.

question

162. Refer to the above diagram. The slope of curve ZZ at point B is: A. infinity. B. zero. C. +1. D. -1.

answer

B. zero.

question

163. Refer to the above diagram. The slope of curve ZZ at point C is approximately: A. -4. B. -2. C. -2 2/5. D. +3.

answer

C. -2 2/5.

question

164. The slope of a line parallel to the vertical axis is: A. zero. B. one. C. infinite. D. one-half.

answer

C. infinite.

question

165. The slope of a line parallel to the horizontal axis is: A. zero. B. one. C. infinite. D. one-half.

answer

A. zero.

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