UNIVERSITY OF TECHNOLOGY, JAMAICA
SCHOOL OF BUSINESS ADMINSTRATION
ECO 1001: INTRODUCTION TO MICROECONOMICS
TUTORIAL #1

1. Which of the following is the best definition of economics?

a) The study of how individuals and societies choose to use the scarce resources that nature and previous generations have provided. b) The study of how consumers spend their income. c) The study of how business firms decide what inputs to hire and what outputs to produce. d) The study of how the Jamaican government allocates tax dollars.

2. Competitive behaviour

a) occurs as a reaction to scarcity. b) occurs only in a market system. c) occurs only when the government allocates goods and services. d) always generates waste.

3. Which of the following can be classified as microeconomics or macroeconomics? Why?

a) Research into why the growth rate of total production (in Barbados) increased during the1990s. b) A theory of how consumers decide what to buy. c) An analysis of IBM’s share of the personal computer market in Jamaica. d) Research on why interest rates were unusually high in the late 1970s and early 1980s.

4. Discuss whether each statement is an example of positive economics or normative economics or if it contains elements of both positive and normative economics:

a) An increase in interest rates will lower the growth rate of the Jamaican economy. b) The 1990s was a dismal decade for the Guyanese economy. Exports fell to its lowest level since 1960. c) The goal of any economic policy should be to lower unemployment rates. d) The national minimum wage should be increased to by 15% as a method of reducing poverty. e) Protectionism is the only proper way to improve the living standards of workers whose jobs are threatened by cheap