Week 1 Review - U1AOS1

Concerning microeconomics and macroeconomics as areas of study, which statement is generally false?

• The issue of waterfront or aviation reforms are good examples of microeconomic studies.

• Microeconomics often studies how particular firms, specific industries and individual markets operate.

• Macroeconomics may study the operation of the circular flow model of the Australian economy and the role played by the level of aggregate demand.

• The problem of Australia’s car industry being uncompetitive against foreign car makers mostly involves macroeconomic issues.

In economics, the problems of scarcity and choice arise because:

• wants are always limited.

• resources and wants are unlimited.

• resources are limited relative to wants, which are virtually unlimited.

• we do not have enough money.

Which of the following is not generally regarded by economists as a physical capital resource?

• The artificial snow-making dam and extra snow-making capacity constructed at Mt Hotham

• Power lines and generators owned by Powercor

• Manufactured items used by firms to help produce other goods and services

• A household washing machine

Normative economics involves analysis based on hard facts that can be proven or disproven beyond doubt. True or false? 

• True

• False

Normative economics can 

• be proven beyond doubt.

• only involve facts.

• be based on personal opinions.

• not be based on personal opinions.

Resources are the outputs used by businesses to produce or supply the goods or services that we need and want. True or false? 

• True

• False

Which of these are mostly related to microeconomics?

• GDP

• Labour market

• Consumer behaviour

• Inflation

Which of these are mostly related to macroeconomics?

• Aggregate demand

• Effect of prices of goods

• Capacity of economy

• Supply of goods

Which of these are mostly related to microeconomics?

• the nation's inflation rate

• operations of a particular firm

• value of national spending

• nature of an industry

Which of these are mostly related to macroeconomics?

• value of national production

• unemployment level

• operations of a firm/business

• the prices of a single market