1|Page
Micro test 3 Dr. Al LSUE Questions and Answers
2024 Complete;100% verified
Which is the most important source of tax revenue for
local governments? - .....ANSWER ...✔✔ Property
taxes
Which of the following is the largest expenditure item of
local governments? - .....ANSWER ...✔✔ Education
A tax structure is called progressive when: - .....ANSWER
...✔✔ The average tax rate decreases if income
decreases
A tax is regressive if it: - .....ANSWER ...✔✔ Takes a
smaller percentage of income as income increases
Which of the following exemplifies a microeconomic
question? - .....ANSWER ...✔✔ Will a new type of
electronic reader or tablet increase the number of
buyers?
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Economic models do not reflect the full complexity of
reality, but instead are based on: - .....ANSWER
...✔✔ Simplifications
Which of the following is a normative economic
statement? - .....ANSWER ...✔✔ A trade surplus of
200 billion dollars should be our policy goal
Which of the following is not a factor of production? -
.....ANSWER ...✔✔ Money
In analyzing human decision and action, economists
assume that: - .....ANSWER ...✔✔ People's behavior
reflects rational self-interest
Economics is a social science that studies how individuals,
institutions, and society may: - .....ANSWER ...✔✔ Best
use resources to maximize satisfaction of economic wants
The production possibilities curve is a graph of: -
.....ANSWER ...✔✔ The maximum combinations of
products that can be produced
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Increasing the share of your income that you save is
good for you. Therefore it would be good for the whole
economy if everyone saved more. This exemplifies the: -
.....ANSWER ...✔✔ Fallacy of composition
The problems of aggregate inflation and unemployment
are: - .....ANSWER ...✔✔ Major topics of
macroeconomics
Microeconomics - .....ANSWER ...✔✔ is concerned with
individual economic units and specific markets
The safest way for an individual to leave a burning
theater is to run for the nearest exit; it is therefore also
the best means of escape for a large audience. This
assertion illustrates the: - .....ANSWER ...✔✔ fallacy
of composition
Normative statements are concerned with: - .....ANSWER
...✔✔ what ought to be
A positive statement is one which is - .....ANSWER
...✔✔ objective and based on facts
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The economizing problem is one of deciding how to
make the best use of: - .....ANSWER ...✔✔ Limited
resources to satisfy virtually unlimited wants
Which of the following might shift a nation's production
possibilities curve inward? - .....ANSWER ...✔✔
devastation by war
The two general types of economic systems that exist
today are: - .....ANSWER ...✔✔ Market systems and
command systems
The French term "laissez-faire: means: - .....ANSWER
...✔✔ let it be
The simple circular flow model shows that: - .....ANSWER
...✔✔ households are on the selling side of the
resource market and on the buying side of the product
market
A market: - .....ANSWER ...✔✔ is an institution that
brings together buyers and sellers
Micro test 3 Dr. Al LSUE Questions and Answers
2024 Complete;100% verified
Which is the most important source of tax revenue for
local governments? - .....ANSWER ...✔✔ Property
taxes
Which of the following is the largest expenditure item of
local governments? - .....ANSWER ...✔✔ Education
A tax structure is called progressive when: - .....ANSWER
...✔✔ The average tax rate decreases if income
decreases
A tax is regressive if it: - .....ANSWER ...✔✔ Takes a
smaller percentage of income as income increases
Which of the following exemplifies a microeconomic
question? - .....ANSWER ...✔✔ Will a new type of
electronic reader or tablet increase the number of
buyers?
,2|Page
Economic models do not reflect the full complexity of
reality, but instead are based on: - .....ANSWER
...✔✔ Simplifications
Which of the following is a normative economic
statement? - .....ANSWER ...✔✔ A trade surplus of
200 billion dollars should be our policy goal
Which of the following is not a factor of production? -
.....ANSWER ...✔✔ Money
In analyzing human decision and action, economists
assume that: - .....ANSWER ...✔✔ People's behavior
reflects rational self-interest
Economics is a social science that studies how individuals,
institutions, and society may: - .....ANSWER ...✔✔ Best
use resources to maximize satisfaction of economic wants
The production possibilities curve is a graph of: -
.....ANSWER ...✔✔ The maximum combinations of
products that can be produced
,3|Page
Increasing the share of your income that you save is
good for you. Therefore it would be good for the whole
economy if everyone saved more. This exemplifies the: -
.....ANSWER ...✔✔ Fallacy of composition
The problems of aggregate inflation and unemployment
are: - .....ANSWER ...✔✔ Major topics of
macroeconomics
Microeconomics - .....ANSWER ...✔✔ is concerned with
individual economic units and specific markets
The safest way for an individual to leave a burning
theater is to run for the nearest exit; it is therefore also
the best means of escape for a large audience. This
assertion illustrates the: - .....ANSWER ...✔✔ fallacy
of composition
Normative statements are concerned with: - .....ANSWER
...✔✔ what ought to be
A positive statement is one which is - .....ANSWER
...✔✔ objective and based on facts
, 4|Page
The economizing problem is one of deciding how to
make the best use of: - .....ANSWER ...✔✔ Limited
resources to satisfy virtually unlimited wants
Which of the following might shift a nation's production
possibilities curve inward? - .....ANSWER ...✔✔
devastation by war
The two general types of economic systems that exist
today are: - .....ANSWER ...✔✔ Market systems and
command systems
The French term "laissez-faire: means: - .....ANSWER
...✔✔ let it be
The simple circular flow model shows that: - .....ANSWER
...✔✔ households are on the selling side of the
resource market and on the buying side of the product
market
A market: - .....ANSWER ...✔✔ is an institution that
brings together buyers and sellers
