MicroEconomics Principles for a Changing World 6th Edition By Eric Chiang (Test Bank All
Chapters, 100% Original Verified, A+ Grade)
Name: Class: Date:
Chapter 1
1. Which statement represents a microeconomic issue?
a. The unemployment rate fell by 2%.
b. All businesses in the United States experienced a decrease in revenues of 5% due to the recession.
c. The price of textbooks rose by 15% last year.
d. GDP increased by 6% last quarter.
ANSWER: c
2. Which topic is MOST likely to be studied in a microeconomics course?
a. rent control
b. unemployment
c. inflation
d. recessions
ANSWER: a
3. Which topic is MOST likely to be studied in a macroeconomics course?
a. taxation methods
b. recessions
c. public utility regulation
d. game theory
ANSWER: b
4. Macroeconomics does NOT concern:
a. recessions.
b. inflation.
c. job creation rates.
d. the determinants of a rise in the price of semiconductor chips.
ANSWER: d
5. Which topic is a microeconomic topic?
a. the U.S. inflation rate in 2009
b. the price of an iPad sold by Apple
c. the U.S. unemployment rate in March 2010
d. the rate of growth of GDP in the first quarter in 2010
ANSWER: b
6. Which topic is a macroeconomic topic?
a. the study of the business cycle
b. the price of a pair of Nike shoes
c. total sales of GE in 2009
d. the labor market for computer analysts
ANSWER: a
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Chapter 1
7. Supply and demand analysis is used:
a. only in microeconomics.
b. only in macroeconomics.
c. in both microeconomics and macroeconomics.
d. in neither microeconomics nor macroeconomics.
ANSWER: c
8. Which topic would a microeconomic analysis address?
a. the national unemployment rate
b. the reasons for a decline in a country's total output
c. the price of college tuition that an individual student pays
d. the inflation rate in Brazil
ANSWER: c
9. International finance is generally studied in:
a. microeconomics.
b. macroeconomics.
c. deductive logic.
d. inductive logic.
ANSWER: b
10. The economics of uranium mining would be studied in:
a. microeconomics.
b. macroeconomics.
c. deductive logic.
d. inductive logic.
ANSWER: a
11. Which statement does NOT concern microeconomics?
a. Profits for some manufacturing firms fell in 2009.
b. In 2009, the unemployment rate in the United States rose to nearly 10%.
c. Salaries of top executives fell in 2009.
d. Competitive markets promote efficiency.
ANSWER: b
12. Which statement regarding macroeconomics and microeconomics is true?
a. Microeconomics examines consumer behavior, while macroeconomics studies business behavior.
b. Macroeconomics employs many of the same analytical tools as microeconomics.
c. Because it focuses on national economies, macroeconomics does not study international trade and finance.
d. Neither macroeconomics nor microeconomics is concerned with prices.
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Chapter 1
ANSWER: b
13. Which effect is NOT macroeconomic?
a. the effect of the budget deficit on the economy
b. the effect of monetary policy on inflation
c. the effect of Walmart's pricing policies on consumers
d. the effect of government policies on the country's unemployment rate
ANSWER: c
14. Which is the BEST example of a microeconomic issue?
a. The Federal Reserve will raise interest rates this week.
b. The unemployment rate will exceed 6% this month.
c. The country's price level has increased over the last quarter.
d. The production of automobiles decreased last year.
ANSWER: d
15. Belinda's favorite recreational activity is sailing, followed by fishing and shopping in that order. When
Belinda has a day off work for a holiday, she prepares to go sailing, then discovers that there's no wind, forcing
her to settle for a day of fishing. Belinda's opportunity cost of fishing is:
a. sailing.
b. sailing and shopping.
c. shopping.
d. the items she would have purchased if she had gone shopping.
ANSWER: d
16. Which statement is NOT a macroeconomic issue?
a. The Federal Reserve will raise interest rates this week.
b. The unemployment rate will exceed 6% this month.
c. The country's price level has increased over the last quarter.
d. The production of automobiles decreased last year.
ANSWER: d
17. Which statement correctly describes economic models?
a. They try to boil down an economic situation to its most basic elements.
b. They are always complex because the economy is complex.
c. They attempt to reproduce reality exactly.
d. They try to avoid invoking the ceteris paribus assumption.
ANSWER: a
18. Which statement is NOT true of economic model building?
a. There may be exceptions to economic models.
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Chapter 1
b. Adding more complexity to models does not always provide greater insights.
c. Economic models always reach verifiable results.
d. Economic models provide generalizations about economic behavior.
ANSWER: c
19. Economists like to use graphs and equations primarily because:
a. these tools efficiently express economic concepts.
b. economics should be difficult.
c. mathematical aptitude is necessary to understand economics.
d. the use of mathematics reduces rigor.
ANSWER: a
20. A theory composed of a number of assumptions and facts boiled down to their basic relevant elements is
called a:
a. metaphor.
b. model.
c. conclusion.
d. practice.
ANSWER: b
21. The purpose of an economic model is to:
a. be a complex, exact replica of reality.
b. demonstrate which values and beliefs are best for the economy.
c. explain the behavior of the issue being examined.
d. manage the economy like an automatic pilot.
ANSWER: c
22. Which statement does NOT describe model building in economics?
a. Models are developed to cover specific behaviors only.
b. Models are created and then tested.
c. Models are used to help understand the general economy.
d. Assumptions are used to analyze an economic issue.
ANSWER: a
23. Economic models must:
a. be completely realistic to be useful.
b. include all relationships that exist in the relevant issue to be modeled.
c. completely represent the real world.
d. rely on the ceteris paribus assumption.
ANSWER: d
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