Question 1

Which of the following best describes a scatter diagram in economics?

Accepted Answer

A graph that shows the relationship between two variables by plotting their values for a number of different observations.

Question 2

If a graph shows that as income increases, expenditure also increases, what type of relationship is this?

Accepted Answer

A positive relationship

Question 3

What does the slope of a straight line on a graph represent in economics?

Accepted Answer

The change in the variable measured on the y-axis divided by the change in the variable measured on the x-axis, $$\frac{\Delta y}{\Delta x}.$$

Question 4

Suppose the relationship between two variables is shown by a downward sloping line. What does this indicate?

Accepted Answer

A negative (inverse) relationship

Question 5

When plotting the relationship between ice cream consumption and price, holding temperature constant is an example of:

Accepted Answer

Ceteris paribus

Question 6

If the slope of a line is calculated as $$\frac{\Delta y}{\Delta x}$$ and $$\Delta y = 10$$, $$\Delta x = 2$$, what is the slope?

Accepted Answer

$$5$$

Question 7

Which of the following is true about the slope of a curved line at a point?

Accepted Answer

It is equal to the slope of the tangent line at that point.

Question 8

A graph shows the relationship between inflation and unemployment in Canada from 2006 to 2021, with no clear pattern. What does this suggest?

Accepted Answer

The variables are unrelated.

Question 9

If a graph shows a relationship that is positive over part of its range and negative over another part, what does this indicate?

Accepted Answer

The relationship has a maximum or a minimum.

Question 10

In economics, what does the term 'ceteris paribus' mean?

Accepted Answer

Holding all other relevant things constant.

Question 11

If the average slope of a curved line across an arc is calculated using the endpoints $$A$$ and $$B$$, which formula is used?

Accepted Answer

$$\frac{y_B - y_A}{x_B - x_A}$$

Question 12

A movie has a production budget of $$200$$ million and earns $$910$$ million at the box office. If other movies with higher budgets do not necessarily earn more, what does this suggest about the relationship?

Accepted Answer

There is no clear tendency for a larger budget to bring greater revenue.

Question 13

Which of the following is NOT a pattern to look for in economic graphs?

Accepted Answer

Variables move in a circle.

Question 14

If the temperature rises from $$21^\circC to$$ $$32^\circC$$, and the curve showing ice cream consumption shifts rightward, what does this represent?

Accepted Answer

An increase in demand due to a change in a third variable.

Question 15

Which axis is typically used to represent the dependent variable in a two-variable economic graph?

Accepted Answer

The y-axis

Question 16

If a line on a graph is upward sloping, what can be inferred about the relationship between the two variables?

Accepted Answer

They have a positive relationship.

Question 17

Which of the following is an example of a nonlinear relationship in economics?

Accepted Answer

A curve that has a maximum or minimum point.

Question 18

When plotting a point on a graph, what do the x-value and y-value represent?

Accepted Answer

The coordinates of the point, with x-value on the horizontal axis and y-value on the vertical axis.

Question 19

If the slope of a line is negative, what does this mean about the relationship between the variables?

Accepted Answer

As one variable increases, the other decreases.

Question 20

In a real-world scenario, if the price of ice cream remains constant but the temperature increases, what is likely to happen to the quantity of ice cream consumed?

Accepted Answer

The quantity consumed will increase, shifting the demand curve rightward.

Graphs and Data Interpretation in Microeconomics

Study Guide - Practice Questions

Study Guide - Flashcards