Introduction to Economics Solved Exam Questions
Course Introduction
Introduction to Economics provides students with a foundational understanding of key economic principles, concepts, and analytical tools. The course explores fundamental topics such as scarcity, opportunity cost, supply and demand, market equilibrium, and the roles of households, firms, and governments in the economy. Students will examine both microeconomic and macroeconomic perspectives, learning how individual choices and market interactions shape broader economic outcomes. Real-world examples and current events are used to illustrate the practical application of economic theory, preparing students for further study in the field and informed participation in economic decision-making.
Recommended Textbook
Essentials of Economics 9th Edition by
Bradley R Schiller
Available Study Resources on Quizplus
17 Chapters
2470 Verified Questions
2470 Flashcards
Source URL: https://quizplus.com/study-set/3313 Page 2
Chapter 1: The Challenge of Economics
Available Study Resources on Quizplus for this Chatper
135 Verified Questions
135 Flashcards
Source URL: https://quizplus.com/quiz/65760
Sample Questions
Q1) In order to understand a particular graph,it is important to know:
A) The total number of squares in the grid.
B) Which variable is on the vertical axis and which is on the horizontal axis.
C) Where a point on the graph is.
D) Where the maximum quantity is.
Answer: B
Q2) Ceteris paribus when technological change allows a smaller amount of a resource to be used in producing any combination of two goods,there will be:
A) A movement along the production possibilities curve.
B) An outward shift of the production possibilities curve.
C) An inward shift of the production possibilities curve.
D) No change in the production possibilities curve.
Answer: B
Q3) The factors of production include the land,labor,and money used to produce goods and services.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above.
3
Chapter 2: The US Economy
Available Study Resources on Quizplus for this Chatper
131 Verified Questions
131 Flashcards
Source URL: https://quizplus.com/quiz/65759
Sample Questions
Q1) In the United States,government regulation is primarily designed to:
A) Protect the environment through government ownership of natural resources.
B) Prevent businesses from competing with each other.
C) Protect labor,consumers,and the environment.
D) Determine all the answers to the WHAT,HOW and FOR WHOM questions.
Answer: C
Q2) The term externalities refers to:
A) Black-market economic activity.
B) Some costs and benefits of a market activity borne by a third party.
C) The impact on markets of goods imported from foreign countries.
D) Illegal economic activity.
Answer: B
Q3) Consumer goods:
A) Account for half of total U.S.output.
B) Include expenditures for durable goods,nondurable goods,and services.
C) Include government expenditure on welfare and food stamps.
D) Account for the smallest portion of U.
Answer: B
To view all questions and flashcards with answers, click on the resource link above.
4
Chapter 3: Supply and Demand
Available Study Resources on Quizplus for this Chatper
148 Verified Questions
148 Flashcards
Source URL: https://quizplus.com/quiz/65758
Sample Questions
Q1) The demand curve will shift to the right if the number of buyers increases,ceteris paribus.
A)True
B)False
Answer: True
Q2) Which of the following will not cause a shift in the demand curve for a good?
A) Income.
B) Taste.
C) The price of the good itself.
D) The prices of other related goods.
Answer: C
Q3) Which of the following is not a factor of production?
A) Land.
B) Wages.
C) Labor.
D) Capital.
Answer: B
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Consumer Demand
Available Study Resources on Quizplus for this Chatper
137 Verified Questions
137 Flashcards
Source URL: https://quizplus.com/quiz/65757
Sample
Questions
Q1) Suppose Suzuki increases the price of a particular motorcycle model by 12 percent and as a result the quantity demanded for that model decreases by 4 percent.The price elasticity of demand for that model is:
A) 0.33.
B) 3.0.
C) 4.0.
D) 12.
Q2) The law of demand explains why people:
A) Crave certain goods.
B) Are willing to buy more of a good as price falls.
C) Are willing to pay more as marginal utility diminishes.
D) Are able to buy more of a good as supply increases.
Q3) Javier goes to an all-you-can-eat buffet at a Chinese restaurant and consumes three plates of food.Which of the following explains why the third plate of food does not provide as much satisfaction as the second plate?
A) The law of expanding externalities.
B) The rule of total utility.
C) The law of supply.
D) The law of diminishing marginal utility.
To view all questions and flashcards with answers, click on the resource link above.
Page 6
Chapter 5: Supply Decisions
Available Study Resources on Quizplus for this Chatper
151 Verified Questions
151 Flashcards
Source URL: https://quizplus.com/quiz/65756
Sample Questions
Q1) The law of diminishing returns indicates that the marginal physical product of a factor declines as more:
A) Output is produced with the most efficient combination of factors.
B) Of the factor is used,holding output constant.
C) Of the factor is used,holding other inputs constant.
D) Of the good is consumed.
Q2) In Figure 5.2,what is the marginal cost of the 12<sup>th</sup> unit of output?
A) $6.00
B) $20.00
C) $52.00
D) $72.00
Q3) In Table 5.6,the total cost of 2 units of output is:
A) $4.
B) $6.
C) $12.
D) $27.
Q4) When the marginal physical product curve shifts upward because of technological advances,the marginal cost curve shifts downward.
A)True
B)False
7
To view all questions and flashcards with answers, click on the resource link above.
Chapter 6: Competition
Available Study Resources on Quizplus for this Chatper
146 Verified Questions
146 Flashcards
Source URL: https://quizplus.com/quiz/65755
Sample Questions
Q1) As long as price is greater than marginal cost,an increase in the rate of output will decrease profit.
A)True
B)False
Q2) The marginal cost curve is the short-run supply curve for a competitive firm.
A)True
B)False
Q3) Suppose that consumers learn that eating apples can significantly reduce a person's chance of getting cancer.Comment on what the apple producers would notice in terms of their marginal cost verses marginal revenue.In the short-run,what would you expect them to do and what would happen to the market price and quantity produced.In the long-run what do you expect would happen to the market price and quantity?
Q4) In a competitive market,maximum efficiency is achieved because of:
A) Competitive pressure on prices.
B) Differentiated products.
C) High barriers to entry.
D) Significant market power.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Monopoly
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/65754
Sample Questions
Q1) Total profit can be calculated as:
A) Average total cost multiplied by price.
B) Total revenue divided by the quantity sold.
C) The difference between price and average total cost multiplied by the quantity sold.
D) Price and average total cost added together and then multiplied by the quantity sold.
Q2) In Table 7.3,at the profit-maximizing rate of output,marginal cost is equal to _____ and marginal revenue is equal to _____.
A) $30 million;$90 million
B) $50 million;$50 million
C) $40 million;$70 million
D) $70 million;$30 million
Q3) In Figure 7.2,profit per unit for a profit-maximizing monopolist is closest to:
A) $1.00.
B) $3.50.
C) $7.50.
D) $8.00
To view all questions and flashcards with answers, click on the resource link above.
9
Chapter 8: The Labor Market
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/65753
Sample Questions
Q1) If consumers want to increase the wages and the number of jobs for strawberry pickers they should:
A) Insist that the government establish a minimum wage for strawberry pickers.
B) Boycott strawberries until wages increase.
C) Insist that sellers raise the price of strawberries.
D) Buy more strawberries.
Q2) Assume a university pays the football coach significantly more than the university's president.This makes good economic sense if the coach:
A) Is more popular.
B) Has a higher level of education.
C) Has been employed at the university longer than the president.
D) Brings more revenue to the university than the president.
Q3) The concept of derived demand means that,for example,the demand for cotton pickers is determined from the demand for clothing made of cotton.
A)True
B)False
Q4) What would we expect to occur to the wage rate and number of persons hired if they workers formed a union?
To view all questions and flashcards with answers, click on the resource link above.
Page 10
Chapter 9: Government Intervention
Available Study Resources on Quizplus for this Chatper
150 Verified Questions
150 Flashcards
Source URL: https://quizplus.com/quiz/65752
Sample Questions
Q1) Suppose a coal burning plant is emitting excessive pollution into the air.Suggest two ways the government can deal with this market failure.
Q2) Based on Figure 9.2:
A) There are external costs associated with cigarette smoking.
B) All the costs associated with cigarette smoking are paid by those who smoke.
C) Cigarette smoking results in equity issues.
D) Social costs and private costs for cigarette smoking are equal.
Q3) Market failure implies that the forces of supply and demand have not led society to the optimal mix of output.
A)True
B)False
Q4) In Figure 9.2,the market demand curve is above the social demand curve because:
A) There are internal costs associated with cigarette smoking.
B) There are free riders associated with cigarette smoking.
C) The external costs of cigarette smoking are being passed on to those who do not smoke.
D) Positive externalities are being passed on to those who do not smoke.
Q5) Explain the impact of external costs and external benefits on the production of public verses private goods.
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: The Business Cycle
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/65751
Sample Questions
Q1) If the CPI is 119 in Year X,then it costs _______ in Year X to buy the same market basket that cost _______ in the base period.
A) $100;$119
B) $119;$100
C) $19;$100
D) $100;$19
Q2) Since the Great Depression,the United States has experienced a number of recessions but none as severe as the Great Depression.
A)True
B)False
Q3) The impact of World War II on the U.S.economy was:
A) To raise the growth rate of real GDP to approximately 19 percent per year.
B) To lower the per capita GDP by 3 percent per year.
C) Deflation at the rate of 10 percent per year.
D) Higher cyclical unemployment up to nearly 25 percent for the economy.
Q4) The uncertainty of inflation can cause a decrease in consumption but will not impact business spending and production.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Aggregate Supply and Demand
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/65750
Sample Questions
Q1) The various quantities of output that all market participants are willing and able to buy at alternative price levels in a given time period is:
A) Market demand.
B) Aggregate demand.
C) Market supply.
D) Aggregate supply.
Q2) According to the foreign trade effect,if the U.S.price level rises then U.S.exports are more expensive for foreigners to buy so the level of real GDP decreases.
A)True
B)False
Q3) Which of the following is an explanation of why the aggregate supply curve slopes upward,assuming the price level increases?
A) The purchasing power of money decreases and businesses buy fewer goods
B) The costs of production increase in the short run and profits become smaller
C) Production costs increase and producers charge higher prices for their goods
D) The demand for loans decreases so interest rates decline and businesses borrow more money
Q4) What is the cornerstone of Keynes' theory?
To view all questions and flashcards with answers, click on the resource link above.
Page 13
Chapter 12: Fiscal Policy
Available Study Resources on Quizplus for this Chatper
150 Verified Questions
150 Flashcards
Source URL: https://quizplus.com/quiz/65749
Sample Questions
Q1) The greater the upward slope of the aggregate supply curve,the greater the increase in the price level when aggregate demand increases.
A)True
B)False
Q2) Fiscal policy includes:
A) A decrease in immigration restrictions.
B) A decrease in import barriers.
C) An increase in government spending.
D) An increase in the discount rate.
Q3) When the economy overheats,the government sometimes cools it down with higher taxes,spending reductions,and less money.Which of the following indicates the appropriate change in the U.S.economy after government intervention?
A) Aggregate demand shifts to the left
B) Aggregate demand shifts to the right
C) The economy moves up along the aggregate demand curve
D) The economy moves down along the aggregate demand curve
Q4) In 2012,the output of the U.S.was almost 16 trillion dollars.Discuss how this output was divided among the components of aggregate demand.
To view all questions and flashcards with answers, click on the resource link above.
Page 14
Chapter 13: Money and Banks
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/65748
Sample Questions
Q1) Which of the following is not true about barter?
A) It involves the direct exchange of one good or service for another.
B) It is more likely to occur if people lose faith in a nation's currency.
C) It is considered to be less efficient for an economy than the use of money.
D) It allows people to obtain more goods than they can using money.
Q2) Which of the following is not true concerning the banking system?
A) It lends funds to the Federal Reserve.
B) It creates money through lending.
C) It impacts aggregate demand through changes in the money supply.
D) It transfers money from savers to spenders.
Q3) Initially a bank has a minimum reserve requirement of 10 percent and no excess reserves.If $10,000 is deposited in the bank,then ceteris paribus:
A) The bank can increase its loans by $10,000.
B) The bank can increase its loans by $9,000.
C) Total reserves will increase by $9,000.
D) Required reserves will increase by $10,000.
Q4) What is a reserve requirement and what function does a reserve serve?
Q5) If the required reserve ratio decreases,the money multiplier decreases.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Monetary Policy
Available Study Resources on Quizplus for this Chatper
148 Verified Questions
148 Flashcards
Source URL: https://quizplus.com/quiz/65747
Sample Questions
Q1) A change in the reserve requirement is the tool used least often by the Fed because it:
A) Does not affect bank reserves.
B) Can cause abrupt changes in the money supply.
C) Does not affect the money multiplier.
D) Has no impact on the lending capacity of the banking system.
Q2) Under Alan Greenspan,the Fed:
A) Targeted interest rates only.
B) Targeted the money supply only.
C) Targeted the unemployment level.
D) Used a mix of money-supply and interest-rate adjustments.
Q3) The shape of the _____ curve determines the impact of an aggregate demand shift on prices and output.
A) Marginal revenue
B) Total cost
C) Production possibilities
D) Aggregate supply
Q4) Congress and the president are the key decision makers for U.S.monetary policy.
A)True
B)False
Page 16
To view all questions and flashcards with answers, click on the resource link above.
Chapter 15: Economic Growth
Available Study Resources on Quizplus for this Chatper
131 Verified Questions
131 Flashcards
Source URL: https://quizplus.com/quiz/65746
Sample Questions
Q1) To produce a combination of goods and services beyond the current production possibilities curve,an economy must:
A) Use more of the available resources and technology.
B) Raise the prices of goods and services so that firms will produce more.
C) Find more resources or develop new technology.
D) Experience population growth.
Q2) Which of the following is the best measure of the growth rate of the economy?
A) The percentage change in real GDP.
B) Investment as a percentage of real GDP.
C) Real GDP per capita.
D) Real GDP per worker.
Q3) Which of the following policies does not shift the aggregate supply curve to the right?
A) Deregulation.
B) Tax cuts.
C) Job training programs.
D) Minimum-wage laws.
Q4) Most people who make minimum-wages are in favor of increases in the minimum-wage.How would you explain to them that this may not be the best thing for the economy?
To view all questions and flashcards with answers, click on the resource link above. Page 17
Chapter 16: Theory and Reality
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/65745
Sample Questions
Q1) Alternating periods of economic growth and contraction are referred to as:
A) Fiscal policy.
B) The business cycle.
C) A policy lever.
D) The fiscal cycle.
Q2) Measurement problems can mean that it's difficult to get reliable data about the economy.
A)True
B)False
Q3) Which of the following supports the argument for hands-off policy?
A) Fiscal policy does not impact the economy.
B) Fine-tuning is not compatible with our design capabilities.
C) Monetary policy does not impact the economy.
D) The economy has been fairly stable since World War II.
Q4) If legislators cannot agree about how to address an economic situation,this is an example of a measurement problem.
A)True
B)False
Q5) Discuss the difference between automatic stabilizers and discretionary fiscal policies.
To view all questions and flashcards with answers, click on the resource link above. Page 18
Chapter 17: International Trade
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/65744
Sample Questions
Q1) If the United States has a trade deficit:
A) Exports exceed imports.
B) The U.S.economy produces more than it consumes.
C) The trade balance is negative.
D) The export ratio is high.
Q2) The United States exports goods such as wheat,computers,and lumber.
A)True
B)False
Q3) The WTO functions as:
A) The enforcer of trade rules for the world.
B) An international informant on terrorism.
C) An international weapons inspector.
D) The international authority on currency exchange.
Q4) Based on the information in Table 17.2,the opportunity cost of producing 1 bushel of corn in Country B is:
A) 9/2 of a bushel of wheat.
B) 1/2 of a bushel of wheat.
C) 1/3 of a bushel of wheat.
D) 2/9 of a bushel of wheat.
To view all questions and flashcards with answers, click on the resource link above. Page 19