Economics Chapter 1 2 Car Dealer Advertises Free Satellite Radio

78. A car dealer advertises free satellite radio for one year with the purchase of a new car. This is an

example of:

79. Applying for a loan in five-person groups is an example of:

80. “Late registration will result in an additional $30 fee.” This is an example of:

81. In the textual example, Muhammad Yunus was highly successful in his use of applying social

incentives through group responsibility in order to maximize loan repayment rates. This success created

an incentive for other banks to:

82. Which of the following is a positive incentive?

83. An incentive is:

84. Which of the following is a positive incentive?

85. Which of the following is an example of a disincentive?

86. The idea of efficiency is used to address which of the following questions?

87. Something is valuable if:

88. A resource is defined to be:

89. The use of resources in the most productive way possible to produce the goods and services that

have the greatest total economic value to society is called:

90. If people have never implemented an idea that you believe offers substantial opportunity:

91. You may incorrectly conclude that an idea no other person has implemented is highly profitable

because:

92. Which of the following is an assumption that economists make?

93. Which of the following describes when government alter normal market activity?

94. If you generate a new idea that has not been implemented yet by anyone else, and the idea offers a

more profitable use of some resource, it is likely an example of:

95. If an idea has not been implemented because a monopoly producer has placed a barrier to entry, the

circumstances are not normal due to:

96. After investigating an idea to open a rooftop restaurant in the downtown area of your community, you

discover that any rooftop restaurant would violate city regulations. These circumstances would not be

considered normal due to:

97. Having a goal that does not include making a profit can often explain why the unprofitable idea has

not been implemented. These types of ideas may include:

98. Why wasn’t everyone else already implementing group responsibility to lend to the poor in the

example in the text?

99. Economic analysis requires us to combine:

100. When two variables have been observed to have a tendency to occur at the same time, we can say

there is ____________ but not necessarily ____________.

101. “More people purchase chap stick when the weather man announces that we are in for a very windy

week.” This statement implies that:

102. The Widgetville County Wolfpack has won 90 percent of their last 20 games played under a full

moon. This means:

103. If out of the two cities that send teams to the Super Bowl, the city with the lowest unemployment rate

wins 70 percent of the time, there would be:

104. When toilet paper sales increase, quarterly economic growth tends to rise. This is an example of:

105. When the price of milk rises, there is no change in the amount of dog food purchased. This is an

example of:

106. As corn prices rise, salsa sales tend to fall. This an example of:

107. When the unemployment rate rises, college enrollment increases because workers seek to expand

training. This is an example of:

108. As monthly rain levels rise, golf course revenue falls because casual golfers prefer to stay dry. This

is an example of:

109. Which of the following is not a way we sometimes confuse correlation and causation?

110. A relationship between two events where one event occurring brings about the other is described

best as:

111. When speed boat sales rise, the city of Las Vegas takes in more revenue. The omitted common

variable between these outcomes is likely to be:

112. In the past, there was a strong correlation between ice cream consumption by children and polio

cases for children. There was not a causal relationship due to:

113. “Which came first, the chicken or the egg?” This question seeks to address the common fallacy of

__________ in the context of correlation and causation.

114. Both minivan sales and birth rates are on the rise. The conclusion that minivans cause people to

have children is an example of making the mistake of:

115. Models should:

116. A simplified representation of a complicated situation is:

117. Which is not a characteristic of a good economic model?

118. One of the most basic models of the economy is:

119. The two most important actors of the economy are:

120. Households are vital to the circular flow model in what two ways?

121. Which actor in the simplified circular flow model buys or rents land, labor, and capital?

122. Which actor in the simplified circular flow model is on the supply side of the goods market?

123. Which actor in the simplified circular flow model is on the supply side of the factor market?

124. The two flows, or things being exchanged, in the circular flow model are:

125. An economic model:

126. In order to understand when a model may not be accurate, which is not an important action to take?

127. An economic model:

128. Thomas Malthus was an early nineteenth-century economist that created a model describing the

relationship between:

129. Thomas Malthus’s model made the mistake of failing to consider:

130. Which type of statement is most likely to include the word “should”?

131. A normative statement is generally based upon:

132. A factual claim about how the world actually works is a ______________ statement.

133. Economies that adopt more open trade policies have often historically enjoyed faster economic

growth rates as a result. This is an example of what kind of statement?

134. “The United States should adopt more open trade policies because they historically have caused

increased economic growth.” This is an example of what kind of statement?

135. People frequently confuse facts with judgments that are based on beliefs. This means that people

have trouble making the distinction between:

136. A positive statement:

137. Which of the following is an example of positive statement?

138. Which of the following is an example of a normative statement?

139. Which of the following is an example of a positive statement?

140. Which of the following is an example of a normative statement?

141. Which of the following is a normative statement?

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142. Which of the following is an example of a normative statement?

143. A statement that “a hair stylist should not have to obtain a cosmetology license” is an example of

what kind of statement?

Chapter 01 Test Bank Summary