Chapter 1 Assessment Flashcards
Why might some historians consider Adam Smith one of the most influential people in history?
a He taught that all people should be economic equals
b he introduced a way of thinking about economic ideas
c he argued for a larger role for the government in the economy
d he wrote the economic argument for american independence
b
Which of these statements is an example of normative economics?
a “taxes ought to be lowered”
b “inflation is higher this year”
c “the bond market is in decline”
d “speculation caused a recession”
a
which of these terms is most closely related to tradeoffs
a incentives
b margin
c markets
d scarcity
d
economists assume people choose something when its expected costs are less than its
a working life
b chief competitors
c anticipated benefits
d required maintenance
c
a limitation of using graphs to represent relationships is that they
a must be presented in a small space
b typically show the less important variables
c omit factors other than those being graphed
d are hard for anyone but economists to interpret
c
which statement is the best example of thinking at the margin
a john has six shirts and is trying to decide whether to buy a seventh
b mary observes that the average cost of shoes is higher than last year
c david decided to volunteer this summer instead of working for pay
d jane wants to buy a car but decides the cannot afford the insurance
a
what is the best test of an economic model
a it has gone unchallenged for decades
b it helps people make decisions more easily
c it is accepted by both liberals and conservatives
d it is useful for both explaining past events and predicting future ones
d
