Question 1

As the number of days without rain increases, the amount of wheat grown per acre declines. A graph showing this relationship shows

Accepted Answer

A)   a horizontal line.
B)   a positive relationship.
C)   a line with a positive slope.
D)   a vertical line.
E)   None of the above answers is correct.F) A) and C)
G) A) and D)

Question 2

Which of the following statements best describes the study of economics?

Accepted Answer

A)   Economics studies how firms make profits.
B)   Economics studies how to organise production so that scarcity does not occur.
C)   Economics studies how businesses reach decisions.
D)   Economics studies how we make choices in the face of scarcity.
E)   Economics studies how to create incentives so that scarcity does not exist.F) A) and B)
G) A) and C)

Question 3

Economics is best defined as the social science that studies

Accepted Answer

A)   how choices made in the social interest must conflict with choices made in the self-interest.
B)   how a person can get everything he or she wants.
C)   the choices that societies, and the people and institutions that make up societies, make in dealing with the issue of scarcity.
D)   the reason money exists.
E)   the way to eliminate choices in our decisions.F) A) and E)
G) C) and D)

Question 4

Your lecturer changes the penalty for cheating on exams from getting a 0 on the exam to getting an F in the course. Your lecturer has

Accepted Answer

A)   recognised that students don't make rational choices.
B)   decreased the marginal benefit of cheating.
C)   made all the students act in the social interest.
D)   recognised that students don't respond to incentives.
E)   increased the marginal cost of cheating.F) None of the above
G) D) and E)

Question 5

A graph shows that the number of Australian tourists visiting a Caribbean island increases as the temperature in southern Australia falls. The graph shows

Accepted Answer

A)   a direct relationship.
B)   a negative relationship.
C)   an invalid relationship.
D)   no relationship.
E)   a positive relationship.F) A) and D)
G) A) and E)

Question 6

-In the diagram above, which figure(s)  show(s)  no relationship between the variables?

Accepted Answer

A)   Only D
B)   Only B
C)   Both B and C
D)   Both A and B
E)   Both A and CF) B) and C)
G) A) and D)

Question 7

In examining two variables, we find that as one variable changes, the other changes. These variables are said to be

Accepted Answer

A)   significantly related.
B)   statistics.
C)   independent.
D)   casually related.
E)   correlated.F) A) and E)
G) None of the above

Question 8

To show how a variable ________, we typically use a ________.

Accepted Answer

A)   changes over time; cross-time chart
B)   relates to another variable; time-series graph
C)   changes over time; cross-section graph
D)   relates to another variable; pie chart
E)   changes over time; time-series graphF) B) and D)
G) A) and B)

Question 9

Which of the following statements is a positive statement?

Accepted Answer

A)   Too many people are unemployed.
B)   Our country must increase military spending.
C)   There should be a computer in every primary school classroom.
D)   Online shopping increased by 50 per cent last Christmas season.
E)   We need to spend less on luxury items for the wealthy, and more on necessities for the less fortunate.F) None of the above
G) A) and B)

Question 10

A graph shows the price of a kilo of cucumbers on the vertical axis and the quantity of new cars sold by Honda on the horizontal axis. The price of a kilo of cucumbers remains constant as the quantity of new cars sold increases. The graph of these data is a

Accepted Answer

A)   horizontal line.
B)   negatively sloped line.
C)   curve with a maximum.
D)   vertical line.
E)   positively sloped line.F) A) and B)
G) A) and C)

Question 11

A slope is measured as the:

Accepted Answer

A)   value of the variable measured on the x-axis minus the value of the variable measured on the y-axis.
B)   change in the value of variable on the y-axis divided by the change in the value of the variable on the x-axis.
C)   value of the variable measured on the y-axis divided by the value of the variable measured on the x-axis.
D)   value of the variable measured on the y-axis minus the value of the variable measured on the x-axis.
E)   value of the variable measured on the x-axis divided by the value of the variable measured on the y-axis.F) A) and E)
G) B) and D)

Question 12

If a curve falls and then rises, it

Accepted Answer

A)   has a minimum.
B)   has a linear relationship.
C)   shows no relationship between the two variables.
D)   has a constant-slope relationship.
E)   has a maximum.F) C) and E)
G) B) and D)

Question 13

The slope of the line shown in the above figure is

Accepted Answer

A)   -5.
B)   -1.
C)   -3.
D)   -1/3.
E)   -10.F) A) and D)
G) A) and C)

Question 14

Choices that are best for the society as a whole are choices in pursuit of

Accepted Answer

A)   answering the 'how?' question.
B)   answering the 'for whom?' question.
C)   self-interest.
D)   incentives.
E)   the social interest.F) A) and C)
G) None of the above

Question 15

The statement that 'increases in the tax on petrol increase the price of petrol' is an example of which of the following?

Accepted Answer

A)   Marginal statement.
B)   Rational-decision statement.
C)   Macroeconomic statement.
D)   Positive statement.
E)   Normative statement.F) A) and B)
G) A) and E)

Question 16

A graph shows the average ATAR scores for males and females in 20192. The kind of graph used to show these data would be a

Accepted Answer

A)   scatter diagram.
B)   trend figure.
C)   time-series graph.
D)   cross-section graph.
E)   time-stationary graph.F) A) and B)
G) C) and D)

Question 17

'Lower ticket prices would lead to more people attending football games.' This statement is a:

Accepted Answer

A)   statement that confuses marginal cost and sunk cost.
B)   macroeconomic statement.
C)   normative statement.
D)   positive statement.
E)   statement assessing the social interest versus the private interest.F) A) and E)
G) A) and D)

Question 18

-The above figure shows the relationship between the price of a slice of pizza and how many slices of pizza Ricardo buys in a week. Between points A and B, the slope of the line is ________ the slope of the line between points B and C.

Accepted Answer

A)   less than
B)   equal to
C)   greater than
D)   not comparable to
E)   unrelated toF) A) and E)
G) A) and D)

Question 19

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

Accepted Answer

A)   Car prices should be affordable.
B)   Fewer people die in larger cars than in smaller cars.
C)   If wages increase, firms will fire some workers.
D)   If cars become more expensive, fewer people will buy them.
E)   Cars emit pollution.F) C) and E)
G) A) and B)

Question 20

Which of the following is a microeconomic topic?
i. K-Mart's decision to close stores that are not making a profit.
ii. Bunning's choice to hire more full-time employees because its sales increased.
iii. Virgin Airlines changes its fares.

Accepted Answer

A)   i only
B)   i and iii
C)   ii and iii
D)   i, ii, and iii
E)   i and ii onlyF) B) and E)
G) C) and D)

Exam 1: Getting Started

A slope is measured as the:

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

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-In the diagram above, which figure(s) show(s) no relationship between the variables?

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Economics is best defined as the social science that studies

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To show how a variable ________, we typically use a ________.

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'Lower ticket prices would lead to more people attending football games.' This statement is a:

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A graph shows the price of a kilo of cucumbers on the vertical axis and the quantity of new cars sold by Honda on the horizontal axis. The price of a kilo of cucumbers remains constant as the quantity of new cars sold increases. The graph of these data is a

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Your lecturer changes the penalty for cheating on exams from getting a 0 on the exam to getting an F in the course. Your lecturer has

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Which of the following is a microeconomic topic? i. K-Mart's decision to close stores that are not making a profit. ii. Bunning's choice to hire more full-time employees because its sales increased. iii. Virgin Airlines changes its fares.

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Which of the following statements best describes the study of economics?

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As the number of days without rain increases, the amount of wheat grown per acre declines. A graph showing this relationship shows

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In examining two variables, we find that as one variable changes, the other changes. These variables are said to be

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If a curve falls and then rises, it

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The statement that 'increases in the tax on petrol increase the price of petrol' is an example of which of the following?

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A graph shows the average ATAR scores for males and females in 20192. The kind of graph used to show these data would be a

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-The above figure shows the relationship between the price of a slice of pizza and how many slices of pizza Ricardo buys in a week. Between points A and B, the slope of the line is ________ the slope of the line between points B and C.

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The slope of the line shown in the above figure is

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Choices that are best for the society as a whole are choices in pursuit of

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Which of the following statements is a positive statement?

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A graph shows that the number of Australian tourists visiting a Caribbean island increases as the temperature in southern Australia falls. The graph shows

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To show how a variable , we typically use a .

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