Economics, 4th Edition Test Bank

1. The point at which the axes of a graph intersect is called the: A) slope. B) origin. C) graph. D) intercept. 2. The ______ of a curve shows the point at which the curve intersects an axis. A) slope B) steepness C) intercept D) origin 3. If two variables are positively related, on a graph they will always be represented by: A) a line or curve that slopes downward. B) a straight line. C) a horizontal line. D) a line or curve that slopes upward. 4. If two variables are negatively related, they will always be represented by: A) a line or curve that slopes downward. B) a straight line. C) a horizontal line. D) a line or curve that slopes upward. 5. If two variables are negatively related: A) as one goes up in value, the other must go up in value, too. B) as one goes up in value, the other must go down in value. C) there can never be a trade-off between the two. D) one variable is always the reciprocal of the other. 6. If two variables are positively related: A) as one goes up in value, the other must go up in value, too. B) as one goes up in value, the other must go down in value. C) there is always a trade-off between the two. D) one variable is always the reciprocal of the other. Page 1 7. The relation between two variables that move in the same direction is said to be: A) independent. B) neutral. C) positive. D) indirect. 8. The relation between two variables that move in opposite directions is said to be: A) independent. B) positive. C) direct. D) negative. 9. On a graph representing two variables: A) a positive slope of a curve means the variables are negatively related. B) a negative slope of a curve means the two variables are positively related. C) a line that is horizontal has a zero slope. D) a line that is vertical has a zero slope. Use the following to answer questions 10-12: Figure: Cold Drinks Sold and Temperature Page 2 10. (Figure: Cold Drinks Sold and Temperature) Look at the figure Cold Drinks Sold and Temperature. If we move from point C to point E in the figure, the outside temperature has ______ degrees and the number of cold drinks sold has ______. A) decreased by 30; decreased by 30 B) increased by 20; increased by 20 C) increased by 30; increased by 30 D) increased by 40; increased by 40 11. (Figure: Cold Drinks Sold and Temperature) Look at the figure Cold Drinks Sold and Temperature. If we move from point B to point C in the figure, the outside temperature has ______ degrees and the number of cold drinks sold has ______. A) decreased by 30; decreased by 30 B) increased by 20; increased by 20 C) increased by 30; increased by 30 D) increased by 40; increased by 40 12. (Figure: Cold Drinks Sold and Temperature) Look at the figure Cold Drinks Sold and Temperature. If we move from point C to point D in the figure, the outside temperature has ______ degrees and the number of cold drinks sold has ______. A) decreased by 30; decreased by 30 B) increased by 20; increased by 20 C) increased by 30; increased by 30 D) increased by 40; increased by 40 Use the following to answer questions 13-15: Figure: Hot Drinks Sold and Temperature Page 3 13. (Figure: Hot Drinks Sold and Temperature) Look at the figure Hot Drinks Sold and Temperature. If we move from point K to point L in the figure, the outside temperature has ______ degrees and the number of hot drinks sold has ______. A) decreased by 30; increased by 30 B) increased by 20; decreased by 20 C) increased by 30; decreased by 30 D) increased by 40; decreased by 40 14. (Figure: Hot Drinks Sold and Temperature) Look at the figure Hot Drinks Sold and Temperature. If we move from point J to point L in the figure, the outside temperature has ______ degrees and the number of hot drinks sold has ______. A) decreased by 30; increased by 30 B) increased by 20; decreased by 20 C) increased by 30; decreased by 30 D) increased by 40; decreased by 40 15. (Figure: Hot Drinks Sold and Temperature) Look at the figure Hot Drinks Sold and Temperature. If we move from point L to point M in the figure, the outside temperature has ______ degrees and the number of hot drinks sold has ______. A) decreased by 30; increased by 30 B) increased by 20; decreased by 20 C) increased by 30; decreased by 30 D) increased by 40; decreased by 40 Use the following to answer questions 16-17: Figure: Good X and Good Y Page 4 16. (Figure: Good X and Good Y) Look at the figure Good X and Good Y. If we move from point B to point C in the figure, the x-variable has ______ units and the y-variable has ______ units. A) decreased by 2; increased by 15 B) increased by 2; decreased by 15 C) decreased by 15; increased by 2 D) increased by 15; decreased by 2 17. (Figure: Good X and Good Y) Look at the figure Good X and Good Y. If we move from point C to point B in the figure, the x-variable has ______ units and the y-variable has ______ units. A) decreased by 2; increased by 15 B) increased by 2; decreased by 15 C) decreased by 15; increased by 2 D) increased by 15; decreased by 2 18. In the graph of a curve, the vertical intercept is: A) the value of the y-variable when the value of the x-variable is equal to zero. B) the change in the y-variable between two points divided by the change in the x-variable between those same two points. C) the value of the y-variable when the value of the slope is equal to zero. D) the value of the x-variable when the value of the y-variable is equal to zero. Use the following to answer question 19: Page 5 19. (Table: Hours Studied and Quiz Score) Look at the table Hours Studied and Quiz Score. The table shows data for students in an economics class. If we were to graph these data and draw a line through the points, we would choose ______ to be the independent variable; the vertical intercept of our line would be ______; and the slope of our line would be ______. A) quiz score; y = 2; –2 B) quiz score; x = 0; –2 C) hours studied; y = 0; +2 D) hours studied; y = 2; +2 Use the following to answer questions 20-21: Figure: Demand and Supply of Shirts 20. (Figure: Demand and Supply of Shirts) Look at the figure Demand and Supply of Shirts. In the graph, if the line labeled D shows how many shirts per week will be demanded at various prices, then it is clear that as the price of shirts falls: A) fewer shirts will be demanded. B) more shirts will be demanded. C) the same quantity of shirts will be demanded. D) it is unclear what will happen to the demand for shirts. 21. (Figure: Demand and Supply of Shirts) Look at the figure Demand and Supply of Shirts. If the line labeled S shows how many shirts per week will be offered for sale at various prices, then it is clear that for supply, quantity and price are: A) the same. B) positively related. C) negatively related. D) not related. Page 6 Use the following to answer questions 22-23: Table: Wages and Hours Willing to Work 22. (Table: Wages and Hours Willing to Work) Look at the table Wages and Hours Willing to Work, which shows data on wage per hour and the number of hours someone is willing to work. Which variable would economists put on the vertical axis? A) Either variable B) the wage, because even though it is the independent variable, it is a price C) hours willing to work, because it is the dependent variable D) neither variable 23. (Table: Wages and Hours Willing to Work) Look at the table Wages and Hours Willing to Work. If it was graphed, the relationship between wage per hour and hours willing to work would be: A) linear. B) coordinated. C) nonlinear. D) negatively sloped. Use the following to answer questions 24-25: Figure: Illustrating Slope Page 7 24. (Figure: Illustrating Slope) Look at the figure Illustrating Slope. In the graph, line 1 depicts X and Y to be: A) positively related. B) nonlinearly related. C) unrelated. D) negatively related. 25. (Figure: Illustrating Slope) Look at the figure Illustrating Slope. In the graph, line 3 depicts X and Y to be: A) positively related. B) unrelated. C) negatively related. D) both constants. Use the following to answer questions 26-27: Figure: Demand and Supply 26. (Figure: Demand and Supply) Look at the figure Demand and Supply. The curve labeled D indicates that a price of $2 is related to a quantity of: A) 0. B) 1. C) 2. D) 3. Page 8 27. (Figure: Demand and Supply) Look at the figure Demand and Supply. The curve labeled S indicates that a price of $2 is related to a quantity of: A) 0. B) 1. C) 2. D) 3. Use the following to answer question 28: Figure: Slope 28. (Figure: Slope) Look at the figure Slope. This graph depicts ______ relation between X and Y. A) a positive B) a negative C) an independent D) no Use the following to answer questions 29-30: Page 9 29. (Table: Wages and Hours Worked) Look at the table Wages and Hours Worked. Graphing the relation with wages on the vertical axis and hours worked on the horizontal axis, the slope between point D and point E is: A) 0.5. B) 5. C) 45. D) 2. 30. (Table: Wages and Hours Worked) Look at the table Wages and Hours Worked. Graphing the relation with wages on the vertical axis and hours worked on the horizontal axis, the slope between point A and point B is: A) 2.5. B) 5. C) 2. D) 2/5. 31. Two points on a nonlinear curve have coordinates given by (5, 15) and (17, 13). The average slope of the curve between these points is: A) –1/6. B) –6. C) 1/4. D) 2.5. 32. If two points on a graph are (0, 8) and (12,15): A) X is 0 when Y is 12. B) X and Y have a positive relation. C) the horizontal intercept is given by the point (0, 8). D) the slope of a line connecting the two points is negative. Page 10 Use the following to answer question 33: Figure: Illustrating Slope 33. (Figure: Illustrating Slope) Look at the figure Illustrating Slope. In the graph, line 2 has a slope of: A) +1. B) 0. C) –1. D) infinity. Use the following to answer questions 34-35: Figure: Demand and Supply Page 11 34. (Figure: Demand and Supply) Look at the figure Demand and Supply. The slope of the curve labeled D is: A) –1. B) 0. C) 1. D) 3. 35. (Figure: Demand and Supply) Look at the figure Demand and Supply. The slope of the curve labeled S is: A) –1. B) 0. C) 1. D) 3. 36. The slope of a straight line is the ratio of the: A) vertical change to the horizontal change. B) horizontal change to the vertical change. C) run over the rise. D) vertical change to the horizontal change, and it must be positive. Use the following to answer questions 37-38: Figure: Slope Page 12 37. (Figure: Slope) Look at the figure Slope. In the graph, the slope of the line between points A and B is: A) +8. B) –8. C) –2. D) +2. 38. (Figure: Slope) Look at the figure Slope. The slope of the line in the graph can be calculated by: A) dividing the horizontal change by the vertical change. B) dividing the vertical change by the horizontal change. C) subtracting the sum of the Y values from the sum of the X values. D) adding the sum of the X values to the sum of the Y values. 39. The ratio of the change in the variable on the vertical axis to the change in the variable on the horizontal axis, measured between two points on the curve, is the: A) axis. B) slope. C) dependent variable. D) independent variable. Use the following to answer questions 40-43: 40. (Table: Price, Quantity Demanded, and Quantity Supplied) Look at the table Price, Quantity Demanded, and Quantity Supplied. A straight line represents the relation between: A) price and quantity demanded. B) price and quantity supplied. C) price and quantity demanded minus quantity supplied. D) quantity demanded and quantity supplied. Page 13 41. (Table: Price, Quantity Demanded, and Quantity Supplied) Look at the table Price, Quantity Demanded, and Quantity Supplied. The data in the figure suggest a nonlinear relation between: A) price and quantity demanded. B) price and quantity supplied. C) quantity demanded and quantity supplied. D) The table does not show a nonlinear relation. 42. (Table: Price, Quantity Demanded, and Quantity Supplied) Look at the table Price, Quantity Demanded, and Quantity Supplied. The slope of the line representing the relation between price on the vertical axis and quantity supplied on the horizontal axis is: A) equal to 1/2. B) equal to 1. C) equal to 2. D) different at different points on the line. 43. (Table: Price, Quantity Demanded, and Quantity Supplied) Look at the table Price, Quantity Demanded, and Quantity Supplied. The slope of the line representing the relationship between price on the vertical axis and quantity demanded on the horizontal axis is: A) equal to 1/2. B) equal to 1. C) equal to 2. D) different at different points on the line. Use the following to answer question 44: Figure: Y = f(X) Page 14 44. (Figure: Y = f(X) Look at the figure Y = f(X). The slope of the relation between x and y: A) is positive and constant. B) is negative and getting steeper. C) is positive and getting steeper. D) is positive and getting flatter. Use the following to answer questions 45-49: Figure: Seasonally Adjusted Unemployment Rate 45. (Figure: Seasonally Adjusted Unemployment Rate) Look at the figure Seasonally Adjusted Unemployment Rate. The distance between each labeled point on the horizontal axis is one year. What is the approximate slope of the graph between 1/2004 and 1/2006? A) 1/2 B) 1 C) –1/2 D) –2 46. (Figure: Seasonally Adjusted Unemployment Rate) Look at the figure Seasonally Adjusted Unemployment Rate. The distance between each labeled point on the horizontal axis is one year. What is the approximate slope of the graph between 1/2001 and 1/2003? A) 2 B) 1 C) –1 D) –2 Page 15 47. (Figure: Seasonally Adjusted Unemployment Rate) Look at the figure Seasonally Adjusted Unemployment Rate. The distance between each labeled point on the horizontal axis is one year. Unemployment was ______ between 1/2001 and 1/2002 and ______ between 1/1999 and 1/2000. A) increasing; decreasing B) increasing; increasing C) decreasing; increasing D) decreasing; decreasing 48. (Figure: Seasonally Adjusted Unemployment Rate) Look at the figure Seasonally Adjusted Unemployment Rate. The distance between each labeled point on the horizontal axis is one year. Unemployment was ______ between 1/2001 and 1/2003 and ______ between 1/2007 and 1/2008. A) increasing; decreasing B) increasing; increasing C) decreasing; increasing D) decreasing; decreasing 49. (Figure: Seasonally Adjusted Unemployment Rate) Look at the figure Seasonally Adjusted Unemployment Rate. The distance between each labeled point on the horizontal axis is one year. Using this graph, the unemployment rate was at a minimum in ______ and a maximum in ______. A) 2003; 2000 B) 2007; 2001 C) 2003; 1999 D) 2000; 2003 Page 16 Use the following to answer questions 50-51: Figure: Labor Force Participation Rate 50. (Figure: Labor Force Participation Rate) Look at the figure Labor Force Participation Rate. Using the figure, the labor force participation rate for women was ______ during 1970–1985 and ______ during 1998–2006. A) increasing; slightly decreasing B) increasing; increasing C) decreasing; increasing D) decreasing; constant 51. (Figure: Labor Force Participation Rate) Look at the figure Labor Force Participation Rate. During 1970–1985, the labor force participation rate was _____ for women and _____ for men. A) increasing; decreasing B) increasing; increasing C) decreasing; increasing D) decreasing; decreasing 52. If a supply curve is represented by the equation Q = 10 + 2P, what is its slope? A) 1/2 B) 1 C) 2 D) 5 Page 17 53. Your boss asks you to graph company profits for the past 10 years. The best way to show this information is with: A) a scatter diagram. B) a pie chart. C) a time-series graph. D) an independent graph. 54. The owner of the Dismal Philosopher, one of five bookstores on College Road, asks you to make a graph showing each College Road bookstore’s share of all five stores’ book purchases. The best way to show this information is with: A) a scatter diagram. B) a pie chart. C) a time-series graph. D) an independent graph. 55. Professor Macro wants to use a numerical graph to show the percentage of government spending accounted for by its various components. Which of the following graphs is most suitable for this purpose? A) bar graph B) pie chart C) time-series graph D) scatter diagram 56. A positive relationship between swimsuits purchased and ice cream purchased could be the result of: A) reverse causality. B) a magnified scale on the swimsuit axis. C) a truncation of the ice cream axis. D) an omitted variable, such as the external temperature. 57. Taylor sees a bar graph showing the average weight of adult males over the past 200 years and concludes that men get more obese over time. Taylor’s conclusion may be wrong, since she did not consider: A) the features of construction. B) omitted variables. C) reverse causality. D) tangent lines. Page 18 Use the following to answer questions 58-61: Figure: Unemployment Rate over Time 58. (Figure: Unemployment Rate over Time) Look at the figure Unemployment Rate over Time. In the time-series graph, as we move from the beginning of 2001 to the beginning of 2003, we see that the unemployment rate has _____ from approximately _____ to approximately _____. A) decreased; 5%; 4% B) increased; 5.3%; 7.3% C) decreased; 7.7%; 5.5% D) increased; 4%; 6% 59. (Figure: Unemployment Rate over Time) Look at the figure Unemployment Rate over Time. In the time-series graph, as we move from 1993 to 1995, we see that the unemployment rate has _____ from approximately _____ to approximately _____. A) decreased; 5%; 4% B) increased; 5.3%; 7.3% C) decreased; 7%; 5.5% D) increased; 4%; 6.3% 60. (Figure: Unemployment Rate over Time) Look at the figure Unemployment Rate over Time. In the time-series graph, as we move from 1991 to 1993, we see that the unemployment rate has _____ from approximately _____ to approximately _____. A) decreased; 5%; 4% B) increased; 5.5%; 7% C) decreased; 7.8%; 5% D) increased; 4%; 6.3% Page 19 61. (Figure: Unemployment Rate over Time) Look at the figure Unemployment Rate over Time. In the time-series graph, as we move from 1997 to 2001, we see that the unemployment rate has _____ from approximately _____ to approximately _____. A) decreased; 5%; 4% B) increased; 5.3%; 7.3% C) decreased; 7.8%; 5.5% D) increased; 4%; 6.3% 62. A ______ graph shows how the value of one or more variables has changed over some period. A) linear B) time-series C) nonlinear D) periodic table 63. The scaling of the axes of a time-series graph: A) is not a critical element in presenting the intended information. B) may change the interpretation of the data. C) generally places the time period on the vertical axis. D) generally puts values of a variable, such as the unemployment rate, on the vertical axis. 64. In a time-series graph, large changes can be made to appear trivial by: A) changing the scale of the axes. B) labeling more intervals. C) defining the dependent variable. D) defining the independent variable. 65. A scatter diagram shows: A) how far apart dependent variables are. B) individual points of data showing both variable values. C) the slope of a line. D) the intercept of a curve. 66. The fact that two variables always move together over time: A) does not prove that one of the variables is dependent on the other. B) proves that one of the variables is dependent on the other. C) proves that changes in one variable cause changes in the other. D) is often illustrated or depicted using either a pie chart or a bar chart. Page 20 67. A pie chart is used to depict information about: A) the relative shares of categories of data. B) the changes of a particular variable over time. C) positive, not negative, relationships among variables. D) the changes of a particular variable over time and positive relationships. 68. A bar graph: A) shows the relative amounts attributable to different categories. B) may be shown by vertical bars to illustrate the comparative sizes of different observations. C) may be shown by horizontal bars to illustrate the comparative sizes of different observations. D) A, B, and C. 69. In looking at a chart of the positive relationship between police officers and crime, the mayor remarks that more police officers cause more crime. The mayor may be wrong because she did not consider: A) the features of construction. B) omitted variables. C) reverse causality. D) tangent lines. Use the following to answer questions 70-71: Figure: Consumption of Pizza and Tacos Page 21 70. (Figure: Consumption of Pizza and Tacos) Look at the figure Consumption of Pizza and Tacos. The figure shows the number of tacos and pizza slices Matt can eat in a day. The relation is nonlinear, and there is a negative relation between the number of tacos and pizza slices that Matt can eat in a day. A) True B) False 71. (Figure: Consumption of Pizza and Tacos) Look at the figure Consumption of Pizza and Tacos. The figure shows the number of tacos and pizza slices Matt can eat in a day. The best estimate of the slope between point A and point B is –4. A) True B) False 72. A linear curve has the same slope between every pair of points. A) True B) False 73. The owner of the Dismal Philosopher, one of the five bookstores on College Road, asks you to make a graph showing each College Road bookstore’s share of all five stores’ book purchases. A good way to show this information is with a pie chart. A) True B) False 74. A town hires more police officers and then has an increase in arrests. One can conclude that the larger police force caused more crime. A) True B) False 75. An economist wishes to build a model to explain the relationship between the number of diamonds purchased every year and the average income of consumers in that year. Which variable should be the dependent variable and which should be the independent variable? All else equal, do you expect this relationship to be positive or negative? Explain. Page 22 Answer Key 1. B 2. C 3. D 4. A 5. B 6. A 7. C 8. D 9. C 10. D 11. C 12. B 13. B 14. D 15. C 16. B 17. A 18. A 19. D 20. B 21. B 22. B 23. C 24. D 25. A 26. D 27. B 28. B 29. D 30. D 31. A 32. B 33. B 34. A 35. C 36. A 37. C 38. B 39. B 40. B 41. A 42. A 43. D 44. C Page 23 45. C 46. B 47. A 48. B 49. D 50. A 51. A 52. A 53. C 54. B 55. B 56. D 57. B 58. D 59. C 60. B 61. A 62. B 63. B 64. A 65. B 66. A 67. A 68. D 69. C 70. A 71. B 72. A 73. A 74. B 75. The number of diamonds purchased should be the dependent variable and the average income should be the independent variable. It is much more reasonable to believe that income causes diamond purchases than the other way around. One would expect a positive relationship. As average income rises, all else equal, diamonds become more affordable to more people, and so more diamonds will be purchased. Page 24