Chapter 01 Testbank
1. The Great Depression:
A. occurred only in the United States
B. resulted in the development of microeconomics
C. was a period of low production and high unemployment
D. ended a few months after the share market crash of 1929
2. Economics is best defined as the study of:
A. inflation, interest rates and the stock market
B. supply and demand
C. how people make choices in the face of scarcity and the implications of those choices for society as a whole
D. the financial concerns of businesses and individuals
3. The field of macroeconomics developed when economists looked for causes of:
A. the wealth of nations
B. the Great Depression
C. World War I
D. poverty and inflation
4. Macroeconomic policies are government policies designed to affect:
A. the environmental impact of all industries
B. the performance of the economy as a whole
C. the economic activity of the government
D. particular sectors of the economy
5. Government actions designed to affect the performance of the economy as a whole are called _______ policies.
A. global
B. microeconomic
C. macroeconomic
D. social
6. The degree to which people have access to goods and services that make their lives easier, healthier, safer and more enjoyable is called the:
A. microeconomic standard
B. global standard
C. scarcity standard
D. standard of living
7. People who enjoy high standards of living usually have all of the following EXCEPT:
A. higher literacy rates
B. longer life expectancies
C. freedom from scarcity
D. better general health
8. The scarcity principle states that:
A. people do not have enough money to buy what they want
B. society will eventually run out of resources
C. with limited resources, having more of one thing means having less of another
D. some countries have fewer resources than others
9. The standard of living in an economy is best measured by:
A. average labour productivity
B. total output
C. output per person
D. the inflation rate
10. If Country A and Country B have the same population size, the standard of living in these two countries can still be different depending on:
A. their respective political systems
B. their respective inflation rates
C. their relative geographic size
D. the relative sizes of total output
11. When comparing the standard of living in two countries, it is important to adjust total output for differences in:
A. geographic area
B. employment levels
C. political systems
D. population
12. If total output increases from $1 trillion to $2 trillion as population increases from 100 million to 200 million, then output per person:
A. doubles
B. increases, but by less than 100%
C. remains constant
D. decreases
13. The process of steady increase in the quantity and quality of goods and services the economy can produce is called:
A. aggregation
B. globalisation
C. production
D. economic growth
14. Average labour productivity equals:
A. average production per year
B. total output
C. output per person
D. output per employed worker
15. The country of Northland produced $1000 billion of output in one year. The population of Northland was 50 million, of whom 30 million were employed. What was average labour productivity in Northland?
A. $20
B. $33
C. $20 000
D. $33 333
16. The value of output was $1000 billion in Northland and $2000 billion in Southland. The population of Northland was 50 million and the population of Southland was 120 million. There were 30 million employed workers in Northland and 75 million employed workers in Southland. Average labour productivity was higher in _________ and the standard of living was _______.
A. Northland; the same in both countries
B. Northland; higher in Northland
C. Southland; the same in both countries
D. Southland; higher in Southland
17. Average consumption in an economy is best measured by _____, while average productivity in an economy is best measured by _____.
A. total output; output per worker
B. output per worker; total output
C. output per person; output per worker
D. output per worker; output per person
18. In Econland, population and average labour productivity are constant. If a larger proportion of the population enters retirement, then total output will _____ and output per person will ______.
A. increase; increase
B. decrease; decrease
C. remain constant; remain constant
D. decrease; remain constant
1. The Great Depression:
A. occurred only in the United States
B. resulted in the development of microeconomics
C. was a period of low production and high unemployment
D. ended a few months after the share market crash of 1929
2. Economics is best defined as the study of:
A. inflation, interest rates and the stock market
B. supply and demand
C. how people make choices in the face of scarcity and the implications of those choices for society as a whole
D. the financial concerns of businesses and individuals
3. The field of macroeconomics developed when economists looked for causes of:
A. the wealth of nations
B. the Great Depression
C. World War I
D. poverty and inflation
4. Macroeconomic policies are government policies designed to affect:
A. the environmental impact of all industries
B. the performance of the economy as a whole
C. the economic activity of the government
D. particular sectors of the economy
5. Government actions designed to affect the performance of the economy as a whole are called _______ policies.
A. global
B. microeconomic
C. macroeconomic
D. social
6. The degree to which people have access to goods and services that make their lives easier, healthier, safer and more enjoyable is called the:
A. microeconomic standard
B. global standard
C. scarcity standard
D. standard of living
7. People who enjoy high standards of living usually have all of the following EXCEPT:
A. higher literacy rates
B. longer life expectancies
C. freedom from scarcity
D. better general health
8. The scarcity principle states that:
A. people do not have enough money to buy what they want
B. society will eventually run out of resources
C. with limited resources, having more of one thing means having less of another
D. some countries have fewer resources than others
9. The standard of living in an economy is best measured by:
A. average labour productivity
B. total output
C. output per person
D. the inflation rate
10. If Country A and Country B have the same population size, the standard of living in these two countries can still be different depending on:
A. their respective political systems
B. their respective inflation rates
C. their relative geographic size
D. the relative sizes of total output
11. When comparing the standard of living in two countries, it is important to adjust total output for differences in:
A. geographic area
B. employment levels
C. political systems
D. population
12. If total output increases from $1 trillion to $2 trillion as population increases from 100 million to 200 million, then output per person:
A. doubles
B. increases, but by less than 100%
C. remains constant
D. decreases
13. The process of steady increase in the quantity and quality of goods and services the economy can produce is called:
A. aggregation
B. globalisation
C. production
D. economic growth
14. Average labour productivity equals:
A. average production per year
B. total output
C. output per person
D. output per employed worker
15. The country of Northland produced $1000 billion of output in one year. The population of Northland was 50 million, of whom 30 million were employed. What was average labour productivity in Northland?
A. $20
B. $33
C. $20 000
D. $33 333
16. The value of output was $1000 billion in Northland and $2000 billion in Southland. The population of Northland was 50 million and the population of Southland was 120 million. There were 30 million employed workers in Northland and 75 million employed workers in Southland. Average labour productivity was higher in _________ and the standard of living was _______.
A. Northland; the same in both countries
B. Northland; higher in Northland
C. Southland; the same in both countries
D. Southland; higher in Southland
17. Average consumption in an economy is best measured by _____, while average productivity in an economy is best measured by _____.
A. total output; output per worker
B. output per worker; total output
C. output per person; output per worker
D. output per worker; output per person
18. In Econland, population and average labour productivity are constant. If a larger proportion of the population enters retirement, then total output will _____ and output per person will ______.
A. increase; increase
B. decrease; decrease
C. remain constant; remain constant
D. decrease; remain constant