Question 1

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

Accepted Answer

Scarcity refers to the unlimited wants and limited resources available to satisfy those wants.

Question 2

A student decides to spend an hour studying for an economics exam instead of going to a movie. What is the opportunity cost of this decision?

Accepted Answer

The enjoyment and experience the student would have received from watching the movie.

Question 3

Which equation correctly represents the marginal decision rule in economics?

Accepted Answer

$MB = MC$

Question 4

Which of the following is a positive statement?

Accepted Answer

Unemployment rate in BC is above the national average.

Question 5

In the context of factors of production, which of the following is an example of capital?

Accepted Answer

A machine used to assemble cars.

Question 6

Which of the following best illustrates a tradeoff?

Accepted Answer

Deciding to allocate more resources to healthcare at the expense of education funding.

Question 7

Suppose Canada increases its production of manufacturing goods by 10%. According to the concept of opportunity cost, what must happen?

Accepted Answer

Canada must decrease production of at least one other good or service.

Question 8

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

Accepted Answer

Nike produces sports shoes in Malaysia.

Question 9

If a policy makes one person better off without making anyone else worse off, economists say the policy is:

Accepted Answer

Efficient.

Question 10

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

Accepted Answer

Microeconomics studies individual choices, while macroeconomics examines the performance of the entire economy.

Question 11

A government is considering a policy to reduce carbon dioxide emissions. Which economic concept is most relevant when evaluating the tradeoff between environmental protection and economic growth?

Accepted Answer

Opportunity cost.

Question 12

Which of the following is a normative statement?

Accepted Answer

Inflation rate should not go beyond 3%.

Question 13

Which formula represents the opportunity cost of choosing option A over option B?

Accepted Answer

$Opportunity\ Cost = Value\ of\ Best\ Alternative\ (B)$

Question 14

Which of the following is NOT a factor of production?

Accepted Answer

Money.

Question 15

A business owner decides to invest in new machinery to increase production. This decision is most closely related to which economic concept?

Accepted Answer

Capital.

Question 16

Which of the following best describes the role of incentives in economic decision-making?

Accepted Answer

Incentives encourage individuals to make choices that maximize their benefits and minimize their costs.

Question 17

Which of the following statements about equity is correct?

Accepted Answer

Equity refers to fairness, but economists may disagree on what is fair.

Question 18

If the marginal benefit ($MB$) of producing one more unit of a good is $10$ and the marginal cost ($MC$) is $8$, what should a rational producer do?

Accepted Answer

Increase production.

Question 19

Which of the following is an example of a decision made at the margin?

Accepted Answer

Deciding whether to produce one more unit of a product.

Question 20

A policy adviser uses economic models to compare marginal benefits and marginal costs of different policy options. What part of economics does this illustrate?

Accepted Answer

Providing a method for evaluating alternative solutions for a given policy goal.

Introduction to Economics: Core Concepts and Scope

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