Question 1

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

Accepted Answer

Scarcity means there are not enough resources to satisfy all human wants.

Question 2

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

Accepted Answer

Why are people streaming more movies?

Question 3

Which of the following is NOT a factor of production?

Accepted Answer

Money

Question 4

In the context of economics, what does the term 'opportunity cost' refer to?

Accepted Answer

The highest-valued alternative that must be given up to get something else.

Question 5

Which of the following statements is a positive statement?

Accepted Answer

An increase in the minimum wage will lead to higher unemployment among teenagers.

Question 6

Suppose you are deciding between attending a concert or working a part-time job. If you choose the concert, what is your opportunity cost?

Accepted Answer

The wages you would have earned at your part-time job.

Question 7

Which of the following best describes a marginal benefit?

Accepted Answer

The additional gain from consuming or producing one more unit of a good or service.

Question 8

A line on a graph that slopes upward from left to right represents:

Accepted Answer

A positive (direct) relationship between two variables.

Question 9

If the slope of a line is calculated as $$\Delta y / \Delta x$$, what does a negative value indicate?

Accepted Answer

The variables move in opposite directions.

Question 10

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

Accepted Answer

The government should provide free healthcare to all citizens.

Question 11

Which of the following best describes the role of incentives in economics?

Accepted Answer

Incentives influence the choices individuals and businesses make.

Question 12

Which of the following is NOT a job typically available to someone with an economics degree?

Accepted Answer

Civil engineer

Question 13

Which of the following is an example of a real-world issue that illustrates the tension between self-interest and social interest?

Accepted Answer

Climate change caused by carbon emissions.

Question 14

Suppose the price of ice cream increases while the temperature remains constant. According to the concept of ceteris paribus, what is likely to happen?

Accepted Answer

The quantity of ice cream consumed will decrease, holding all other factors constant.

Question 15

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 16

If a relationship between two variables is shown by a curved line on a graph, what does this indicate?

Accepted Answer

The relationship is nonlinear.

Question 17

Which of the following is a key skill employers look for in economics graduates?

Accepted Answer

Analytical skills

Question 18

A rational choice is one that:

Accepted Answer

Compares costs and benefits and achieves the greatest benefit over cost for the decision maker.

Question 19

If the marginal benefit of an activity exceeds its marginal cost, what should a rational individual do?

Accepted Answer

Increase the activity.

Question 20

Which of the following best describes the earnings potential for an economics major compared to other majors?

Accepted Answer

Economics majors earn more than most other majors at mid-career.

Chapter 1: What is Economics? (Microeconomics Study Notes)

Study Guide - Practice Questions

Study Guide - Flashcards