Home

Student Resources

Chapter 1: The Nature of Economics

Quizzes

Quiz 3

Quiz 3


This activity contains 10 questions.

	A politician states "taxes should be raised to provide more spending on school lunch programs." This is   a ceteris paribus assumption. a positive economic statement. a normative economic statement. none of the above.

	A friend recommends a movie and you go see it, expecting that you will like it; however, you think it is the worst movie you have seen in years, and wish you hadn't wasted your money on it. This situation   shows the rationality assumption is false because you were worse off for seeing the movie. has nothing to do with the rationality assumption. shows that you behaved irrationally because you didn't get enough information about the movie before seeing it. is consistent with rational behavior because you had thought that you were going to like the movie.

	The impact of the national debt on the number of unemployed in the economy is an example of   macroeconomics. microeconomics. irrational economics. either microeconomics or macroeconomics.

	What is a major difference between social sciences and natural sciences?   Social sciences use models and theories while natural sciences do not. Social sciences examine what has happened in the real world in order to test their models while natural sciences make use of laboratory methods. Social sciences utilize models that are based on a simplification of reality while the natural sciences use realistic models. Theories are not used in social sciences but are used in natural sciences.

	An increase in the price of gasoline will reduce the amount of gasoline purchased. This is   a positive economic statement. neither a normative nor a positive statement. a normative economic statement. none of the above.

	Economics is   A) a physical science since it seeks explanations of real events. B) a social science since it analyzes human behavior. C) a natural science since it analyzes nonhuman behavior like income. D) both A and B. E) both A and C. F) both B and C.

	Economic models   should be judged by how well they predict real-world phenomena. are developed so that changes in variables can be studied under controlled conditions. should be rejected if they are not completely realistic. are developed in order to explain an individual's thinking.

	The rationality assumption of economics states that   individuals do not intentionally make decisions that will leave them worse off. individuals thought processes will not respond to incentives. individuals only make decisions that leave them better off. none of the above.

	"We ought to do more for the education of our children." Statements using words like "ought" or "should" are   irrational statements. empirical statements. positive statements. normative statements.

	Explaining economic growth is   normative economics. considered part of macroeconomics. more political than economic. considered part of microeconomics.

Copyright © 1995 - 2009, Pearson Education, Inc., publishing as Pearson Addison Wesley Legal and Privacy Terms