Question 1

Which of the following best defines the concept of 'scarcity' in economics?

Accepted Answer

Scarcity is the inability to satisfy all our wants due to limited resources.

Question 2

Which of the following is an example of a microeconomic question?

Accepted Answer

Why are people buying more e-books and fewer hard copy books?

Question 3

According to the economic way of thinking, what is a 'tradeoff'?

Accepted Answer

A tradeoff is giving up one thing to get something else.

Question 4

Which of the following statements is a positive statement?

Accepted Answer

Increasing the minimum wage will lead to higher unemployment among teenagers.

Question 5

What is the opportunity cost of attending a concert instead of working a part-time job for $100 and missing a friend's party?

Accepted Answer

The $100 you would have earned plus the enjoyment from the friend's party.

Question 6

Which of the following best describes 'marginal benefit'?

Accepted Answer

Marginal benefit is the additional gain from consuming or producing one more unit of a good or service.

Question 7

Suppose a student is deciding how many hours to study for an exam. The marginal benefit of studying an extra hour is higher than the marginal cost. According to economic theory, what should the student do?

Accepted Answer

Study for the extra hour.

Question 8

Which of the following is NOT considered a factor of production?

Accepted Answer

Money used to buy stocks.

Question 9

In economics, what does 'capital' refer to?

Accepted Answer

Tools, machines, and buildings used to produce goods and services.

Question 10

Which of the following best illustrates the concept of 'incentives' in economics?

Accepted Answer

A tax on cigarettes that discourages smoking.

Question 11

Which of the following is an example of a normative statement?

Accepted Answer

The government should reduce income inequality.

Question 12

If a country wants to increase its production of manufactured goods, which factor of production must it most directly increase?

Accepted Answer

Capital

Question 13

Which of the following best describes the difference between microeconomics and macroeconomics?

Accepted Answer

Microeconomics studies individual and business choices, while macroeconomics studies the performance of national and global economies.

Question 14

Which of the following equations correctly represents the opportunity cost of an action?

Accepted Answer

$$Opportunity\ Cost = Value\ of\ Next\ Best\ Alternative$$

Question 15

A government wants to reduce carbon emissions. Which economic principle can it use to encourage people to reduce their carbon footprint?

Accepted Answer

Change incentives by imposing a carbon tax.

Question 16

Which of the following is a real-world example of a tradeoff?

Accepted Answer

A student choosing between working part-time or studying for exams.

Question 17

Which of the following best describes the role of an economist as a policy adviser?

Accepted Answer

An economist provides methods for evaluating alternative solutions by comparing marginal benefits and marginal costs.

Question 18

Which of the following is NOT a skill typically required for economics jobs?

Accepted Answer

Ability to perform complex chemical experiments.

Question 19

Suppose the marginal cost of producing one more unit of a good is $$10, and the marginal benefit is 8. $$According to economic theory, what should the producer do?

Accepted Answer

Not produce the additional unit.

Question 20

Which of the following best describes 'efficiency' in resource use?

Accepted Answer

It is not possible to make someone better off without making someone else worse off.

Chapter 1: What Is Economics? (Microeconomics: Canada in the Global Environment)

Study Guide - Practice Questions

Study Guide - Flashcards