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ECON 130 Midterm 1 || A+ Verified Solutions.
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Which of the following defines economics? Economics is the social science that studies ___________. correct answers The choices made to cope with scarcity, how incentives influence those choices, and how the choices are coordinated Microeconomics is the study of correct answers How individual ho...

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  • August 18, 2024
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  • 2024/2025
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  • which of the following defines economics economic

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ECON 130 Midterm 1 || A+ Verified Solutions.
Which of the following defines economics? Economics is the social science that studies
___________. correct answers The choices made to cope with scarcity, how incentives influence
those choices, and how the choices are coordinated

Microeconomics is the study of correct answers How individual households and firms make
decisions.

Which of the following areas of study typifies microeconomics as opposed to macroeconomics?
correct answers The impact of minimum-wage laws on employment in the fast food industry

Which of the following describes the reason why scarcity exists? correct answers Wants exceed
the resources available to satisfy them.

Which of the following is not a key idea in the economic way of thinking? correct answers Poor
people are discriminated against and should be treated more fairly

Which of the following best illustrates your marginal benefit from studying? correct answers
What you are willing to give up to study for one additional hour.

John is an athlete. He has $120 to spend and wants to buy either a heart rate monitor or new
running shoes. Both the heart rate monitor and running shoes cost $120, so he can only buy one.
This illustrates the principle that correct answers People face trade-offs.

Which of the following is a positive statement? correct answers Competition among wireless
service providers across the borders of Canada, Mexico, and the United States has driven
roaming rates down

One way to characterize the difference between positive statements and normative statements is
as follows: correct answers Positive statements offer descriptions of the way things are, whereas
normative statements offer opinions on how things ought to be.

Suppose an economist develops a theory that higher food prices arise from higher gas prices.
According to the scientific method, which of the following is the economist's next step? correct
answers Collect and analyze data.

The production possibilities curve demonstrates which of the following concepts? correct
answers all of the above (scarcity, choice, trade-offs)

In the figure below, moving from producing 50 guitars and 50 ukuleles to producing 25 guitars
and 75 ukuleles, the opportunity cost of one ukulele is correct answers 1 guitar

A point on the production possibilities frontier reflects an correct answers attainable point with
full employment of all resources.

, The negative slope of the production possibilities frontier represents the idea correct answers of
tradeoffs, that in order to produce more of one good, the nation must produce less of another.

Production is efficient when correct answers the economy cannot produce more of one good
without giving up the production of another good

(1) Refer to the figure below. Assume that only two goods can be produced in the economy.
Which of the following statements is TRUE? correct answers Points b and c are attainable, but
only point b is efficient point of production.

When economists talk about a demand schedule for a product, they mean correct answers the
amount of a good that consumers intend to purchase at each price in a set of possible prices in a
given time period

Which of the following best represents the law of demand? correct answers As the price of a
good decreases, the quantity demanded of that good increases.

A fundamental principle in demand analysis is that a change in price leads to correct answers a
movement along the demand curve

(2) Refer to the figure below. Which of the following statements is TRUE? correct answers Panel
A shows a change in quantity demanded and Panel B shows a change in demand

If goods X and Y are substitute goods, then an increase in the price of Y, other things being
equal, correct answers results in a decrease in the quantity of Y consumed, but increases the
demand for X

The law of supply states that there is correct answers a direct relationship between price and
quantity supplied, ceteris paribus

Which of the following causes a movement along a supply curve? correct answers a change in
the price

(3) Refer to the figure below. Moving from point A to point B indicates correct answers a
decrease in quantity supplied

Which of the following will NOT affect the position of the market supply curve for a good?
correct answers The price of the good increases

Economics is best defined as the social science that studies correct answers the choices that
societies, and the people and institutions that make up societies, make in

Which of the following is a microeconomic issue? correct answers The quantity of wheat grown
in the United States increases this year.

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