Sharpen your skills and prepare for your microeconomics exam with a wealth of essential facts in a quick-and-easy Q&A format! Get the question-and-answer practice you need with McGraw-Hill's 500 Microeconomics Questions . Organized for easy reference and intensive practice, the questions cover all essential microeconomics topics and include detailed answer explanations. The 500 practice questions are similar to course exam questions so you will know what to expect on test day. Each question includes a fully detailed answer that puts the subject in context. This additional practice helps you build your knowledge, strengthen test-taking skills, and build confidence. From monopolies to the income inequality, this book covers the key topics in microeconomics. Prepare for exam day with: 500 essential microeconomics questions and answers organized by subject - Detailed answers that provide important context for studying - Content that follows the current college 101 course curriculum Eric R. Dodge, Ph.D. (Madison, IN) , is a professor of economics and chair of the Department of Economics and Business Administration at Hanover College in Hanover, Indiana. He is the coauthor of Economics DeMYSTiFieD (McGraw-Hill, 2012). Melanie E. Fox, Ph.D. (Sherman, TX) , is an associate professor of economics at Austin College in Sherman, Texas. She is the coauthor of Economics DeMYSTiFieD (McGraw-Hill, 2012). Eric R. Dodge, Ph.D. (Madison, IN) , is a professor of economics and chair of the Department of Economics and Business Administration at Hanover College in Hanover, Indiana. He is the coauthor of Economics DeMYSTiFieD (McGraw-Hill, 2012). Melanie E. Fox, Ph.D. (Sherman, TX) , is an associate professor of economics at Austin College in Sherman, Texas. She is the coauthor of Economics DeMYSTiFieD (McGraw-Hill, 2012). McGraw-Hill's 500 Macroeconomics Questions Ace Your College Exams By Eric R. Dodge Melanie E. Fox McGraw-Hill Companies, Inc. Copyright © 2013 The McGraw-Hill Companies, Inc. All right reserved. ISBN: 978-0-07-178048-3 Contents Chapter One Basic Economic Concepts 1. Which of the following would be the best definition of the study of economics? (A) Economics is the study of how the stock market operates. (B) Economics is the study of money. (C) Economics is the study of how scarce resources are allocated to unlimited wants. (D) Economics is the study of how firms decide to make hiring decisions. (E) Economics is the study of how governments set production goals. 2. Which of the following best describes a microeconomic question? (A) What is the value of the US dollar in terms of other foreign currencies? (B) Should a particular firm enter a market? (C) Is the economy of Japan in a recession? (D) What is the value of the goods and services that the United States produces every year? (E) What is the aggregate price level in an economy? 3. Sally is asked by her teacher to write a paper based on a macroeconomic topic. Which of the following titles would be appropriate for a macroeconomics paper? (A) Are Inflation and Unemployment Related? (B) Women's Labor Force Decisions Following Marriage (C) Does a Mother's Level of Education Influence Purchasing Decisions? (D) How Did Households Make Housing Decisions During the Great Depression? (E) How Do Families Decide How Much Health Insurance to Purchase? 4. The idea of _________ in economics is that we have unlimited wants but limited resources. (A) opportunity costs (B) scarcity (C) marginal analysis (D) specialization (E) normative economics 5. Consumers, firms, and governments face _________ because we are faced with the problem of _________. (A) marginal analysis; scarcity (B) specialization and trade; normative economics (C) trade-offs; specialization (D) trade-offs; scarcity (E) marginal analysis; trade-offs 6. Normative analysis can best be shortened to _________, while positive analysis is best shortened to _________. (A) the next best alternative; the way things should be (B) the way things should be; the way things are (C) the way things should be; the next best alternative (D) the way things are; the next best alternative (E) the way things are; the way things should be 7. What is the best definition of the term marginal? (A) Instead of (B) The additional one (C) The average one (D) The cheapest one (E) The most expensive one 8. Jim is at an all-you-can-eat buffet and is considering whether or not to get another plateful of food. What type of analysis should he be doing if he is thinking rationally? (A) Marginal analysis (B) Positive analysis (C) Normative analysis (D) Free-market analysis (E) Collective analysis 9. A centrally planned system would be characterized by which of the following? (A) Prices effectively allocate resources. (B) Private ownership of resources ensures that they are distributed equally. (C) Fi