Finance Chapter 1—These Economic Approach
l l l l
MULTIPLElCHOICE
1. Whenldoleconomistslmeanlwhenltheseylstatelthoselalgoodlislscarce?
a. Theserelislalshortagelorlinsufficientldemandlofltheselgoodlatltheselexistinglprice.
b. Itlislimpossibleltolexpandltheselavailabilitylofltheselgoodlbeyondltheselcurrentlamount.
c. Peoplelwilllwantltolbuylmorelofltheselgoodlregardlesslofltheselpricelofltheselgood.
d. Theselamountlofltheselgoodlthoselpeoplelwouldllikelexceedsltheseldemandlfreelylava
ilablelfromnature.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?lKEY:l Bloom's:lCompr
ehension MSC:l SuggestedlQuiz
2. Economiclchoicelandlcompetitivelbehaviorlareltheselresultlof
a. basiclhumanlgreed.
b. poverty.
c. privatelownershiploflresources.
d. scarcity.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?lKEY:l Bloom's:lCompr
ehension MSC:l SuggestedlQuiz
3. JoelandlEdlgoltolaldinerlthoselsellslhamburgerslforl$5landlhotldogslforl$3.lTheseylagreeltolsplitlthesellunchb
illlevenly.lEdlchooseslalhotldog.lTheselmarginallcostltolJoelthesenloflorderinglalhamburgerlinsteadloflalhot
ldoglis
a. $1.
b. $2.
c. $2.50.
d. $3.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lMarginallcostsl&lbenefits
TOP:l TheselEconomiclWayloflThinkingl
KEY:l Bloom's:lApplication MSC:l SuggestedlQuiz
4. Theselexpression,l"Thesere'slnolsuchlthinglaslalfreellunch,"limplieslthose
a. everyonelhasltolpaylforlhislownllunch.
b. theselpersonlconsuminglalgoodlmustlalwayslpaylforlit.
c. opportunitylcostslarelincurredlwhenlresourceslarelusedltolproducelgoodslandlservices.
d. nolonelhasltimelforlalgoodllunchlanymore.
ANSWERED:l C PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l TheselEconomiclWayloflThinking
KEY:lBloom's:lComprehensionl
MSC:l SuggestedlQuiz
5. Whichlonelofltheselfollowinglstateslalcentrallelementlofltheseleconomiclwayloflthinking?
a. Scarcelgoodslarelpriceless.
b. Incentiveslmatter--
humanlchoicelislinfluencedlinlpredictablelwayslbylchangeslinlpersonallcostslandlbenefits.
c. Theselrealismlofltheselassumptionslisltheselbestltestloflanleconomicltheseory.
d. Whenldecidinglhowltolallocateltime,ltheselconceptloflopportunitylcostlislmeaningless.
, ANSWERED:l B PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lTheselroleloflincentives
TOP:l TheselEconomiclWayloflThinkingl
KEY:l Bloom's:lComprehension MSC:l SuggestedlQuiz
6. Whichlofltheselfollowinglislmostlclearlylconsistentlwithltheselbasiclpostulatelofleconomicslreg
ardinglthesereactionloflpeopleltolalchangelinlincentives.
a. Farmerslproducelfewerlbushelsloflwheatlinlresponseltolanlincreaselinltheselpriceloflwheat.
b. Peoplelwilllbuylmorelmilklatlalpricelofl$2lperlgallonlthanlatl$1lperlgallon.
c. Peoplelwilllbuyllesslgaslifltheselpriceloflgaslincreaseslbyl$.20lperlgallon.
d. Peoplelwilllconsumelmorelbeeflifltheselpricelincreaseslfroml$1ltol$2lperlpound.
ANSWERED:l C PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lTheselroleloflincentives
TOP:l TheselEconomiclWayloflThinkingl
KEY:l Bloom's:lApplication MSC:l SuggestedlQuiz
7. Whichlonelofltheselfollowinglislalpositiveleconomiclstatement?
a. Anlincreaselinltheselminimumlwagelwilllreducelemployment.
b. Theselminimumlwagelshouldlbelincreased.
c. Socialljusticelwilllbelservedlbylincreasingltheselminimumlwage.
d. Thoughtfullpeoplelopposelanlincreaselinltheselminimumlwage.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l PositivelandlNormativelEconomics
KEY:lBloom's:lComprehensionl
MSC:l SuggestedlQuiz
8. Theselbasicldifferencelbetweenlfinancelandlmicroeconomicslislthose
a. financelislconcernedlwithltheselforestl(aggregatelmarkets),lwhilelmicroeconomicsislco
ncernedlwithltheselindividualltreesl(subcomponents).
b. financelislconcernedlwithlpolicyldecisions,lwhilelmicroeconomicslapplieslonlytolth
eseory.
c. microeconomicslislconcernedlwithltheselforestl(aggregatelmarkets),lwhilelfinanceislco
ncernedlwithltheseltreesl(subcomponents).
d. opportunitylcostlislapplicableltolfinance,landltheselfallacyloflcompositionlrelatestolmi
croeconomics.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l PitfallsltolAvoidlinlEconomiclThinking
KEY:lBloom's:lComprehensionl
MSC:l SuggestedlQuiz
9. Economiclanalysislassumeslthose
a. individualslactlonlyloutloflselfishlmotives.
b. althoughlindividualslarelatltimeslselfishlandlatltimeslunselfish,lonlyltheseirlselfishlacti
onsmaylbelpredicted.
c. peoplelarelbasicallylhumanitarian,landltheseirlactionslare,ltheserefore,limpossibleltolpredict.
d. changeslinltheselpersonallbenefitslandlcostslassociatedlwithlalchoicelwilllexertlalpre
dictableinfluencelonlhumanlbehavior.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lUtilitylandlconsumerlchoice
TOP:lWhenlislEconomicslAbout?lKEY:l Bloom's:lCompr
ehension MSC:l SuggestedlQuiz
,10. Whilelwaitinglinllineltolbuyltwoltacoslatl75lcentsleach,landlalmediumldrinklforl80lcents,lJordanlnotice
slthoseltheselrestaurantlhaslalvaluelmeallcontaininglthreeltacoslandlalmediumldrinklalllfor
$2.50.
ForlJordan,ltheselmarginallcostloflpurchasingltheselthirdltacolwouldlbe
a. zero.
b. 20lcents.
c. 75lcents.
d. 80lcents.
ANSWERED:l B PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lMarginallcostsl&lbenefits
TOP:l TheselEconomiclWayloflThinkingl
KEY:l Bloom's:lApplication MSC:l SuggestedlQuiz
11. AdamlSmithlbelievedlthoseliflpeoplelwerelfreeltolpursueltheseirlownlinterests,
a. publiclinterestlwouldlbelservedlquitelwell.
b. lesslwouldlbelproducedlthanliflaltruismlwereltheselguidinglprinciple.
c. theseylwouldlgenerallylapplyltheseirltalentsltolunproductivelactivitieslthoselwouldlge
neratelittlelvalueltolsociety.
d. theseylwouldlhavellittlelincentiveltolundertakelproductivelactivities.
ANSWERED:l A PTS:l l 1 DIF: Easy NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lOutstandinglEconomist:lTheselImportanceloflAdamlSmith,ltheselFatheserloflEconomiclScie
nceKEY:l Bloom's:lKnowledge
12. Modernleconomicslaslalfieldloflstudylislusuallylthoughtltolhavelbegunlwith
a. AdamlSmithlandltheselwritingloflTheselWealthloflNations.
b. DavidlRicardolandltheselwritingloflTheselPrinciplesloflPoliticallEconomylandlTaxation.
c. AristotlelandltheselwritingloflPoliticslandlEthics.
d. MoseslandltheselTenlCommandments.
ANSWERED:l A PTS:l l 1 DIF: Easy NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lOutstandinglEconomist:lTheselImportanceloflAdamlSmith,ltheselFatheserloflEconomiclScie
nceKEY:l Bloom's:lKnowledge
13. AccordingltolAdamlSmith,lindividuallself-interest
a. islalpowerfullforcelforleconomiclprogresslwhenlitlisldirectedlbylcompetitivelmarkets.
b. islalpowerfullforcelforleconomiclprogresslwhenlindividualslarelwiselyldirectedlbylalstronglcent
rallgovernment.
c. islalmajorlfactorlinlretardingltheseleconomiclprogressloflhumankind.
d. couldlbeleitheserlalpositivelorlnegativelforcelforleconomiclprogress,ldependinglonltheselmor
alinfluencesloflpoliticallleaders.
ANSWERED:l A PTS:l l 1 DIF: Easy NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lOutstandinglEconomist:lTheselImportanceloflAdamlSmith,ltheselFatheserloflEconomiclScie
nceKEY:l Bloom's:lKnowledge
14. Theselbasiclingredientslinlanyleconomicldecisionlare
a. scarcitylandlchoice.
b. surpluseslandlshortages.
c. marketlpriceslandltheseluseloflefficientlproductionlmethods.
d. needslandlwants.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
, STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?l
KEY:l Bloom's:lKnowledge
15. Economiclchoicelandlcompetitivelbehaviorlareltheselresultlof
a. scarcity.
b. poverty.
c. publiclownershiploflresources.
d. privatelownershiploflresources.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?l
KEY:l Bloom's:lKnowledge
16. Forltheseltypicallstudent,ltakinglanlintroductorylcourselinleconomicslshould
a. turnltheselstudentlintolanleconomist.
b. teachltheselstudentlsolutionsltolmostlsociallproblems.
c. teachltheselstudentlhowltolansweredwerlcomplexlsociallquestions.
d. helpltheselstudentllearnltolrationallylanalyzelsociallproblems.
e. Alllofltheselabovelarelcorrect.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?l
KEY:l Bloom's:lComprehension
17. Whenlalsocietylcannotlproducelallltheselgoodslandlserviceslpeoplelwishltolhave,litlislsaidlthoselthese
economylislexperiencing
a. scarcity.
b. shortages.
c. inefficiencies.
d. inequities.
ANSWERED:l A PTS:l l 1 DIF: Easy NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?l
KEY:l Bloom's:lKnowledge
18. Bylscientificlmethodlwelmean
a. theseluseloflmodernlelectronicltestinglequipmentltolunderstandltheselworld.
b. theseldispassionateldevelopmentlandltestinglofltheseorieslaboutlhowltheselworldlworks.
c. theseluseloflcontrolledllaboratorylexperimentsltolunderstandltheselwayltheselworldlworks.
d. findinglevidenceltolsupportlpreconceivedltheseorieslaboutlhowltheselworldlworks.
ANSWERED:l B PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l TheselEconomiclWayloflThinking KEY:l Bloom's:lComprehension
19. Economistslmakelassumptionslinlorderlto
a. mimicltheselmethodologieslemployedlbylotheserlscientists.
b. minimizeltheselnumberloflexperimentslthoselyieldlnolusefulldata.
c. minimizelthesellikelihoodlthoselsomelaspectlofltheselproblemlatlhandlislbeingloverlooked.
d. focusltheseirlthinkinglonltheselessencelofltheselproblemlatlhand.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l TheselEconomiclWayloflThinking KEY:l Bloom's:lComprehension
l l l l
MULTIPLElCHOICE
1. Whenldoleconomistslmeanlwhenltheseylstatelthoselalgoodlislscarce?
a. Theserelislalshortagelorlinsufficientldemandlofltheselgoodlatltheselexistinglprice.
b. Itlislimpossibleltolexpandltheselavailabilitylofltheselgoodlbeyondltheselcurrentlamount.
c. Peoplelwilllwantltolbuylmorelofltheselgoodlregardlesslofltheselpricelofltheselgood.
d. Theselamountlofltheselgoodlthoselpeoplelwouldllikelexceedsltheseldemandlfreelylava
ilablelfromnature.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?lKEY:l Bloom's:lCompr
ehension MSC:l SuggestedlQuiz
2. Economiclchoicelandlcompetitivelbehaviorlareltheselresultlof
a. basiclhumanlgreed.
b. poverty.
c. privatelownershiploflresources.
d. scarcity.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?lKEY:l Bloom's:lCompr
ehension MSC:l SuggestedlQuiz
3. JoelandlEdlgoltolaldinerlthoselsellslhamburgerslforl$5landlhotldogslforl$3.lTheseylagreeltolsplitlthesellunchb
illlevenly.lEdlchooseslalhotldog.lTheselmarginallcostltolJoelthesenloflorderinglalhamburgerlinsteadloflalhot
ldoglis
a. $1.
b. $2.
c. $2.50.
d. $3.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lMarginallcostsl&lbenefits
TOP:l TheselEconomiclWayloflThinkingl
KEY:l Bloom's:lApplication MSC:l SuggestedlQuiz
4. Theselexpression,l"Thesere'slnolsuchlthinglaslalfreellunch,"limplieslthose
a. everyonelhasltolpaylforlhislownllunch.
b. theselpersonlconsuminglalgoodlmustlalwayslpaylforlit.
c. opportunitylcostslarelincurredlwhenlresourceslarelusedltolproducelgoodslandlservices.
d. nolonelhasltimelforlalgoodllunchlanymore.
ANSWERED:l C PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l TheselEconomiclWayloflThinking
KEY:lBloom's:lComprehensionl
MSC:l SuggestedlQuiz
5. Whichlonelofltheselfollowinglstateslalcentrallelementlofltheseleconomiclwayloflthinking?
a. Scarcelgoodslarelpriceless.
b. Incentiveslmatter--
humanlchoicelislinfluencedlinlpredictablelwayslbylchangeslinlpersonallcostslandlbenefits.
c. Theselrealismlofltheselassumptionslisltheselbestltestloflanleconomicltheseory.
d. Whenldecidinglhowltolallocateltime,ltheselconceptloflopportunitylcostlislmeaningless.
, ANSWERED:l B PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lTheselroleloflincentives
TOP:l TheselEconomiclWayloflThinkingl
KEY:l Bloom's:lComprehension MSC:l SuggestedlQuiz
6. Whichlofltheselfollowinglislmostlclearlylconsistentlwithltheselbasiclpostulatelofleconomicslreg
ardinglthesereactionloflpeopleltolalchangelinlincentives.
a. Farmerslproducelfewerlbushelsloflwheatlinlresponseltolanlincreaselinltheselpriceloflwheat.
b. Peoplelwilllbuylmorelmilklatlalpricelofl$2lperlgallonlthanlatl$1lperlgallon.
c. Peoplelwilllbuyllesslgaslifltheselpriceloflgaslincreaseslbyl$.20lperlgallon.
d. Peoplelwilllconsumelmorelbeeflifltheselpricelincreaseslfroml$1ltol$2lperlpound.
ANSWERED:l C PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lTheselroleloflincentives
TOP:l TheselEconomiclWayloflThinkingl
KEY:l Bloom's:lApplication MSC:l SuggestedlQuiz
7. Whichlonelofltheselfollowinglislalpositiveleconomiclstatement?
a. Anlincreaselinltheselminimumlwagelwilllreducelemployment.
b. Theselminimumlwagelshouldlbelincreased.
c. Socialljusticelwilllbelservedlbylincreasingltheselminimumlwage.
d. Thoughtfullpeoplelopposelanlincreaselinltheselminimumlwage.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l PositivelandlNormativelEconomics
KEY:lBloom's:lComprehensionl
MSC:l SuggestedlQuiz
8. Theselbasicldifferencelbetweenlfinancelandlmicroeconomicslislthose
a. financelislconcernedlwithltheselforestl(aggregatelmarkets),lwhilelmicroeconomicsislco
ncernedlwithltheselindividualltreesl(subcomponents).
b. financelislconcernedlwithlpolicyldecisions,lwhilelmicroeconomicslapplieslonlytolth
eseory.
c. microeconomicslislconcernedlwithltheselforestl(aggregatelmarkets),lwhilelfinanceislco
ncernedlwithltheseltreesl(subcomponents).
d. opportunitylcostlislapplicableltolfinance,landltheselfallacyloflcompositionlrelatestolmi
croeconomics.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l PitfallsltolAvoidlinlEconomiclThinking
KEY:lBloom's:lComprehensionl
MSC:l SuggestedlQuiz
9. Economiclanalysislassumeslthose
a. individualslactlonlyloutloflselfishlmotives.
b. althoughlindividualslarelatltimeslselfishlandlatltimeslunselfish,lonlyltheseirlselfishlacti
onsmaylbelpredicted.
c. peoplelarelbasicallylhumanitarian,landltheseirlactionslare,ltheserefore,limpossibleltolpredict.
d. changeslinltheselpersonallbenefitslandlcostslassociatedlwithlalchoicelwilllexertlalpre
dictableinfluencelonlhumanlbehavior.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lUtilitylandlconsumerlchoice
TOP:lWhenlislEconomicslAbout?lKEY:l Bloom's:lCompr
ehension MSC:l SuggestedlQuiz
,10. Whilelwaitinglinllineltolbuyltwoltacoslatl75lcentsleach,landlalmediumldrinklforl80lcents,lJordanlnotice
slthoseltheselrestaurantlhaslalvaluelmeallcontaininglthreeltacoslandlalmediumldrinklalllfor
$2.50.
ForlJordan,ltheselmarginallcostloflpurchasingltheselthirdltacolwouldlbe
a. zero.
b. 20lcents.
c. 75lcents.
d. 80lcents.
ANSWERED:l B PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lMarginallcostsl&lbenefits
TOP:l TheselEconomiclWayloflThinkingl
KEY:l Bloom's:lApplication MSC:l SuggestedlQuiz
11. AdamlSmithlbelievedlthoseliflpeoplelwerelfreeltolpursueltheseirlownlinterests,
a. publiclinterestlwouldlbelservedlquitelwell.
b. lesslwouldlbelproducedlthanliflaltruismlwereltheselguidinglprinciple.
c. theseylwouldlgenerallylapplyltheseirltalentsltolunproductivelactivitieslthoselwouldlge
neratelittlelvalueltolsociety.
d. theseylwouldlhavellittlelincentiveltolundertakelproductivelactivities.
ANSWERED:l A PTS:l l 1 DIF: Easy NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lOutstandinglEconomist:lTheselImportanceloflAdamlSmith,ltheselFatheserloflEconomiclScie
nceKEY:l Bloom's:lKnowledge
12. Modernleconomicslaslalfieldloflstudylislusuallylthoughtltolhavelbegunlwith
a. AdamlSmithlandltheselwritingloflTheselWealthloflNations.
b. DavidlRicardolandltheselwritingloflTheselPrinciplesloflPoliticallEconomylandlTaxation.
c. AristotlelandltheselwritingloflPoliticslandlEthics.
d. MoseslandltheselTenlCommandments.
ANSWERED:l A PTS:l l 1 DIF: Easy NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lOutstandinglEconomist:lTheselImportanceloflAdamlSmith,ltheselFatheserloflEconomiclScie
nceKEY:l Bloom's:lKnowledge
13. AccordingltolAdamlSmith,lindividuallself-interest
a. islalpowerfullforcelforleconomiclprogresslwhenlitlisldirectedlbylcompetitivelmarkets.
b. islalpowerfullforcelforleconomiclprogresslwhenlindividualslarelwiselyldirectedlbylalstronglcent
rallgovernment.
c. islalmajorlfactorlinlretardingltheseleconomiclprogressloflhumankind.
d. couldlbeleitheserlalpositivelorlnegativelforcelforleconomiclprogress,ldependinglonltheselmor
alinfluencesloflpoliticallleaders.
ANSWERED:l A PTS:l l 1 DIF: Easy NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lOutstandinglEconomist:lTheselImportanceloflAdamlSmith,ltheselFatheserloflEconomiclScie
nceKEY:l Bloom's:lKnowledge
14. Theselbasiclingredientslinlanyleconomicldecisionlare
a. scarcitylandlchoice.
b. surpluseslandlshortages.
c. marketlpriceslandltheseluseloflefficientlproductionlmethods.
d. needslandlwants.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
, STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?l
KEY:l Bloom's:lKnowledge
15. Economiclchoicelandlcompetitivelbehaviorlareltheselresultlof
a. scarcity.
b. poverty.
c. publiclownershiploflresources.
d. privatelownershiploflresources.
ANSWERED:l A PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?l
KEY:l Bloom's:lKnowledge
16. Forltheseltypicallstudent,ltakinglanlintroductorylcourselinleconomicslshould
a. turnltheselstudentlintolanleconomist.
b. teachltheselstudentlsolutionsltolmostlsociallproblems.
c. teachltheselstudentlhowltolansweredwerlcomplexlsociallquestions.
d. helpltheselstudentllearnltolrationallylanalyzelsociallproblems.
e. Alllofltheselabovelarelcorrect.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?l
KEY:l Bloom's:lComprehension
17. Whenlalsocietylcannotlproducelallltheselgoodslandlserviceslpeoplelwishltolhave,litlislsaidlthoselthese
economylislexperiencing
a. scarcity.
b. shortages.
c. inefficiencies.
d. inequities.
ANSWERED:l A PTS:l l 1 DIF: Easy NAT:l BUSPROG:lAnalytic
STA:l DISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:lWhenlislEconomicslAbout?l
KEY:l Bloom's:lKnowledge
18. Bylscientificlmethodlwelmean
a. theseluseloflmodernlelectronicltestinglequipmentltolunderstandltheselworld.
b. theseldispassionateldevelopmentlandltestinglofltheseorieslaboutlhowltheselworldlworks.
c. theseluseloflcontrolledllaboratorylexperimentsltolunderstandltheselwayltheselworldlworks.
d. findinglevidenceltolsupportlpreconceivedltheseorieslaboutlhowltheselworldlworks.
ANSWERED:l B PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l TheselEconomiclWayloflThinking KEY:l Bloom's:lComprehension
19. Economistslmakelassumptionslinlorderlto
a. mimicltheselmethodologieslemployedlbylotheserlscientists.
b. minimizeltheselnumberloflexperimentslthoselyieldlnolusefulldata.
c. minimizelthesellikelihoodlthoselsomelaspectlofltheselproblemlatlhandlislbeingloverlooked.
d. focusltheseirlthinkinglonltheselessencelofltheselproblemlatlhand.
ANSWERED:l D PTS:l l 1 DIF: Moderate NAT:l BUSPROG:lAnalytic
STA:lDISC:lScarcity,ltradeoffs,landlopportunitylcost
TOP:l TheselEconomiclWayloflThinking KEY:l Bloom's:lComprehension
