Practice Quiz 1

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University of Manitoba *

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1020

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Economics

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May 26, 2024

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docx

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Practice Quiz – Chapter 1 1. Which of the following is a microeconomic topic? A) the reasons why a consumer buys less honey B) the reasons why the average price level in a country falls C) the cause of increasing unemployment D) the effect of the government budget deficit on inflation E) the reasons why the labour force in a country decreases 2. The study of how wages are set for New Brunswick teachers is classified as A) a macroeconomic topic. B) a microeconomic topic. C) economics of social interest. D) economics of private interest. E) normative economics. 3. Which of the following newspaper headlines concerns a macroeconomic issue? A) Why are people buying more SUVs and fewer minivans? B) How would a tax on e-commerce affect chapters.indigo.ca? C) How would an unexpected freeze in Oxford, Nova Scotia change the price of blueberries in the Maritimes? D) Why is the U.S. economy experiencing slow growth? E) Why do grain producers purchase less pesticides? 4. Complete the following sentence. Macroeconomics A) is primarily concerned with the operation of individual markets in the economy. B) deals mainly with the economic behaviour of households. C) is the only part of economics to deal with government decisions. D) is primarily concerned with the behaviour of the stock market. E) is the study of the performance of the national economy and the global economy. 5. The fact that human wants cannot be fully satisfied with available resources is called the problem of A) opportunity cost. B) scarcity. C) normative economics. D) marginal cost. E) the big tradeoff. 6. The problem of scarcity exists A) only in economies that lack incentives. B) only in economies that have incentives. C) in all economies. D) only when people are unemployed. E) now but will be eliminated with economic growth.

7. An incentive A) could be a reward but could not be a penalty. B) could be a penalty but could not be a reward. C) could be either a reward or a penalty. D) is the opposite of a tradeoff. E) occurs in the macroeconomy but not in the microeconomy. 8. Choose the statement about incentives that is incorrect . A) An incentive can be a penalty that discourages an action. B) Incentives create scarcity. C) With stiffer penalties for fraud, company directors have an incentive to play by the rules. D) If the price of a bus ride falls, Jill has less incentive to drive herself to school. E) An incentive can be a reward that encourages an action. 9. ) The two big economic questions A) summarize the scope of economics. B) are "what goods and services are produced?" and "how are goods and services produced?" C) are "why are goods and services produced?" and "when are goods and services produced?" D) deal with macroeconomics but not microeconomics. E) are "where are goods and services produced?" and "what goods and services are produced?" 10. The two big economic questions include all of the following except A) what to produce. B) why to produce. C) how to produce. D) for whom to produce. E) a determination of whether the pursuit of self-interest also promotes the social interest. 11. An art museum decides to offer audio tour downloads rather than have tour guides. The museum is answering the ________ question. A) "what" B) "who" C) "how" D) "where" E) "when" 12. A choice is in the social interest when it is A) best for the poorest citizens. B) influenced by lobbyists. C) best for society as a whole. D) made by majority vote. E) made by well-meaning citizens. 13. The expansion of international trade, borrowing and lending, and investment is A) the big tradeoff. B) not in the best interests of most countries.

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