Chapter 1 Quiz

Question 1

In the equation, L = 50 + .3W, the slope of the line is:

Answer 1

+.3

Question 2

Normative economics analyzes:

Answer 2

What should be.

Question 3

One way a transaction can be unanimously supported is when:

Answer 3

All parties affected by the transaction gain.

Question 4

One’s working conditions other than their wage are known as:

Answer 4

Nonpecuniary factors.

Question 5

Pareto Efficiency implies that:

Answer 5

All mutually-beneficial transactions have been completed

Question 6

Some economists are against minimum wage laws because:

Answer 6

Minimum wage laws may block transactions that parties might be willing to make at a lower wage.

Question 7

What is the most all-pervasive assumption underlying economic theory?

Answer 7

Scarcity.

Question 8

When analyzing persons, economists consider their primary objective to be:

Answer 8

Utility maximization

Question 9

Which of the following could not be a public good?

Answer 9

A baseball glove.

Question 10

Which of the following is not an example of market failure?

Answer 10

Perfect information.