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ECO 213- Exam | 155 Questions with Answers 100% Verified Correct
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ECO 213- Exam | 155 Questions with Answers 100% Verified Correct
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ECO 213- Exam | 155 Questions with Answers100% Verified Correct|
1) Which of the following is correct?
A) Economics is a decision science that studies the tradeoffs we are forced to make because of
scarcity.
B ) Every individual, no matter how rich or poor, is faced with making tradeoffs.
C) Anytime you have to decide which action to take you are facing an economic tradeoff.
D) All of these are correct. - ✔✔D) All of these are correct.
2) Who ultimately decides what goods and services will be produced in a market economy?
A) none of these
B ) producing firms
C) the ruling political party
D) consumers - ✔✔D) consumers
3) Which of the following is a problem inherent in centrally planned economies?
A) Production managers do not satisfy consumer wants but the government's orders.
B ) There are no problems, everyone including consumers are satisfied.
C) Too much production of low-cost, high-quality goods and services.
D) None of these describe the problem inherent in a centrally planned economy. - ✔✔A)
Production managers do not satisfy consumer wants but the government's orders.
4) What explains the efficiency of markets?
A) They always result in equity.
B ) Markets promote equal standards of living.
C) The government stays out.
,D) Markets promote competition and voluntary exchange - ✔✔D) Markets promote
competition and voluntary exchange
5) Which of the following uses do economic models fulfill?
A) Make economic ideas explicit and concrete for use by decision makers.
B ) Simplification of some aspect of economic life.
C) To answer economic questions.
D) All of these. - ✔✔D) All of these.
6) Why does voluntary exchange increase economic efficiency?
A) Because the true economic value of the good or service is established.
B ) Because it is free and consequently does not cost anything.
C) Because neither the buyer nor the seller would agree to a trade unless they both benefit.
D) It doesn't, only government approved exchange is considered efficient. - ✔✔C) Because
neither the buyer nor the seller would agree to a trade unless they both benefit.
7) Which of the following is a positive economic statement?
A) If the price of gasoline rises, a smaller quantity of it will be bought.
B ) The government should close income tax loopholes.
C) Everyone should live at the same standard of living.
D) U.S. firms should not be allowed to practice outsourcing. - ✔✔A) If the price of gasoline
rises, a smaller quantity of it will be bought.
8) Which of the following is a normative statement?
A) The current high price of gasoline is the result of strong world wide demand.
B ) The price of gasoline is too high.
C) All of these.
D) None of these - ✔✔B ) The price of gasoline is too high.
,9) Why are so many graphs used in economics?
A) Complications can be more easily overcome by abstract simplifications made possible using
graphs.
B ) Graphs illustrate and simplify economic ideas.
C) Graphs highlight key economic relationships.
D) All of these reasons are why so many graphs are used in economics. - ✔✔D) All of these
reasons are why so many graphs are used in economics.
10) Which of the following is correct?
A) A direct relationship has a positive slope value.
B ) An inverse relationship has a negative slope value.
C) A curved line has slope values that change at every point.
D) All of these are correct. - ✔✔D) All of these are correct.
11) Economics is the study of
A) supply and demand.
B ) how to make money in a market economy.
C) the choices everybody makes to attain their goals, given their scarce resources.
D) how to make money in the stock market. - ✔✔C) the choices everybody makes to attain
their goals, given their scarce resources.
12) What assumptions about humans do economists make?
A) People are greedy and selfish.
B ) None, because economics takes humans as given.
C) Humans prefer to live in a society that values fairness above all else.
D) People are rational and respond to incentives - ✔✔D) People are rational and respond to
incentives
, 13) Scarcity
A) is found only in developing nations.
B ) occurs because there are too many people.
C) occurs because of unlimited wants and limited resources available to fulfill these wants.
D) is not a problem for the wealthy. - ✔✔C) occurs because of unlimited wants and limited
resources available to fulfill these wants.
14) Which of the following best describes the assumption about human behavior that
economics makes?
A) People weigh religious, envy, compassion, anger aspects in all decisions they make.
B ) Assuming rational behavior is useful in explaining choices people make even though they
may not behave rationally all the time.
C) Economics assumes individuals act rationally all the time in all circumstances.
D) None of these describes what economics assumes about human behavior. - ✔✔B )
Assuming rational behavior is useful in explaining choices people make even though they may
not behave rationally all the time.
15) What does the adjective marginal mean in economics?
A) Something done at the edge of a market, like buying a table at a garage sale.
B ) Buying something that is illegal to buy.
C) Incremental, additional, or extra of some action.
D) None of these illustrate how the word marginal is used in economics. - ✔✔C) Incremental,
additional, or extra of some action
16) Where are buyers and sellers brought together?
A) Only in cities, towns, and villages.
B ) A market, which can be a location or an electronic connection.
C) A market, which has to be a physical location.
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