Microeconomics 8th Ed Pindyk Rubinfeld Test Bank Chapter
1 Questions And Correct Answers
1) Microeconomics is the branch of economics that deals with which of the following
topics?
A) The behavior of individual consumers
B) Unemployment and interest rates
C) The behavior of individual firms and investors
D) B and C
E) A and C
Answer: E
Answer: E
2) There's a Rolling Stones song that says, "You can't always get what you want." What
that suggests is one of the central ideas in microeconomics. Which of the following
statements best illustrates that idea?
A) Because consumers have only limited incomes to spend, they must make the best
buying choices they can.
B) With wage and working conditions given, workers do not have as much leisure as
they'd like.
C) Laborers in a centrally planned economy, like North Korea, do not have much
freedom to choose what jobs to take.
D) Businesses in a market economy may only have limited funds.
Answer: A
3) Economics is the study of the allocation of scarce resources. Which of the following is
NOT an example of economic scarcity?
A) If Steve goes to see a movie on Saturday, he will not have enough money to buy ice
,cream.
B) If Jenny studies for her economics quiz this evening, she will not have time to walk
her dog.
C) If General Motors increases its production of SUVs this year, it will have to spend
more on advertising.
D) If Barnes and Noble bookstore increases the number of titles it carries, it will have to
reallocate shelf space to accommodate the new titles.
Answer: C
4) A sound and helpful theory of the gold price:
A) facilitates predictions about gold price movements over time.
B) can be based on simplifying assumptions.
C) does not have to accurately forecast every change in the price of gold.
D) all of the above
E) none of the above
Answer: D
5) Based on the following two statements, answer this question:
I. Economic theories are designed to explain observed phenomena by deducing from a
set of basic rules and assumptions.
II. Economic theories employ value judgments to decide who ought to pay more taxes.
A) Both I and II are true.
B) I is true, and II is false.
C) I is false, and II is true.
D) Both I and II are false.
Answer: B
, 6) Which of the following is a positive statement?
A) The President of the United States should be directly elected by the will of the
American people, rather than the Electoral College.
B) A fundamental axiom of the economic theory of consumer behavior is that consumers
always prefer to have more of any good rather than less of it.
C) Since many adults cannot afford to attend college, a tax credit for tuition should be
created.
D) all of the above
E) none of the above
Answer: B
We have an expert-written solution to this problem!
7) Which of the following is a normative statement?
A) The taxes paid by the poor should be reduced in order to improve the income
distribution in the U.S.
B) State governments should not subsidize corporations by training welfare recipients.
C) Presidential candidates should not be given funds from the federal government to run
campaigns.
D) The sea otter should not be extended into Southern California coastal waters,
because it will lower the value of fisheries.
E) all of the above
Answer: E
8) Which of the following is a positive statement?
A) Intermediate microeconomics should be a requirement for all economics majors so
that students have a sound basis in economic theory.
B) The minimum wage should not be raised because such an action would reduce
1 Questions And Correct Answers
1) Microeconomics is the branch of economics that deals with which of the following
topics?
A) The behavior of individual consumers
B) Unemployment and interest rates
C) The behavior of individual firms and investors
D) B and C
E) A and C
Answer: E
Answer: E
2) There's a Rolling Stones song that says, "You can't always get what you want." What
that suggests is one of the central ideas in microeconomics. Which of the following
statements best illustrates that idea?
A) Because consumers have only limited incomes to spend, they must make the best
buying choices they can.
B) With wage and working conditions given, workers do not have as much leisure as
they'd like.
C) Laborers in a centrally planned economy, like North Korea, do not have much
freedom to choose what jobs to take.
D) Businesses in a market economy may only have limited funds.
Answer: A
3) Economics is the study of the allocation of scarce resources. Which of the following is
NOT an example of economic scarcity?
A) If Steve goes to see a movie on Saturday, he will not have enough money to buy ice
,cream.
B) If Jenny studies for her economics quiz this evening, she will not have time to walk
her dog.
C) If General Motors increases its production of SUVs this year, it will have to spend
more on advertising.
D) If Barnes and Noble bookstore increases the number of titles it carries, it will have to
reallocate shelf space to accommodate the new titles.
Answer: C
4) A sound and helpful theory of the gold price:
A) facilitates predictions about gold price movements over time.
B) can be based on simplifying assumptions.
C) does not have to accurately forecast every change in the price of gold.
D) all of the above
E) none of the above
Answer: D
5) Based on the following two statements, answer this question:
I. Economic theories are designed to explain observed phenomena by deducing from a
set of basic rules and assumptions.
II. Economic theories employ value judgments to decide who ought to pay more taxes.
A) Both I and II are true.
B) I is true, and II is false.
C) I is false, and II is true.
D) Both I and II are false.
Answer: B
, 6) Which of the following is a positive statement?
A) The President of the United States should be directly elected by the will of the
American people, rather than the Electoral College.
B) A fundamental axiom of the economic theory of consumer behavior is that consumers
always prefer to have more of any good rather than less of it.
C) Since many adults cannot afford to attend college, a tax credit for tuition should be
created.
D) all of the above
E) none of the above
Answer: B
We have an expert-written solution to this problem!
7) Which of the following is a normative statement?
A) The taxes paid by the poor should be reduced in order to improve the income
distribution in the U.S.
B) State governments should not subsidize corporations by training welfare recipients.
C) Presidential candidates should not be given funds from the federal government to run
campaigns.
D) The sea otter should not be extended into Southern California coastal waters,
because it will lower the value of fisheries.
E) all of the above
Answer: E
8) Which of the following is a positive statement?
A) Intermediate microeconomics should be a requirement for all economics majors so
that students have a sound basis in economic theory.
B) The minimum wage should not be raised because such an action would reduce
