by Scott Cawfield
School of Business
Centennial College

How to Do Better On Economics Tests

There are four topics covered in this section: "Six Steps to Help You Prepare for a Test or Exam," "Seven Strategies for Writing Economics Tests Effectively," "Tips for Answering Different Types of Questions," and "Your Follow-up and Evaluation."

Six Steps to Help You Prepare for a Test or Exam

1. Ask the instructor about the format if she doesn't offer this to the class. Expect that some instructors will be helpful, but others won't. Questions to ask the instructor about are the types of questions, the approximate mark allocations for various types of questions, and the basis of the test (whether it is more on text, or more on notes).

2. Try to figure out how closely the test will follow the learning objectives that have been established for the course. Normally they are available in the course outline.

3. Ask others how they are preparing. They may be willing to share some of their notes with you, or you can trade material to make up for gaps in your notes. You might also be able to get your classmates to share other materials they found interesting or useful with you.

4. Set a study schedule that fits your particular fatigue threshold. Some people get bored easily when they are studying and need blocks of time separated by breaks during which they watch TV, listen to music, exercise, or just "chill out."

5. Prepare your own pre-test; try test material from the study guide provided with your book, if the package is available. If it's not, ask the instructor to make arrangements with the publisher's sales representative to get the study guide. Try the self-study exercises on the website for your book. See if the instructor has made some arrangement with the computer lab for you to have access to a test bank for the course.

6. Exercise more than usual prior to a test; this will relax you, and make you more productive. Eat nutritionally balanced meals before an exam with lots of vegetables and fruit but little sugar.

Seven Strategies for Effectively Writing Economics Tests

1. When you open the test booklet, write down all the key information that you think is going to be helpful.

2. Read the whole test over before you start anything, noting the point allocations.

3. Read any directions carefully. Read each question carefully, noting what is being asked for. Some students start each question in an encyclopedic way, not really showing that they understood the question being posed. Begin wherever you are strongest; it is a confidence booster, which you might need.

4. Answer the questions you know best first, then come back to the ones that you are weaker on; your mind will be working on the weak spots as you proceed with your stronger responses.

5. Be sure to follow instructions on a machine-based test (e.g., use of pencil rather than pen) to the letter. This may have an effect on your grade.

6. Try to compare new questions to what you already know. After careful analysis, a question that looks new to you may resemble a question you did in class or studied.

7. Different kinds of questions require different kinds of skills. Use these different skills to excel no matter what type of questions you are required to answer. (See the next section for some tips.)

Tips for Answering Different Types of Questions

Multiple-Choice Questions: Make sure you read every word in objective-type questions. Watch out for qualifiers such as "always," "never," "all," "none," or "every." They may invalidate a potential answer that is otherwise correct. More general multiple-choice answer options are often correct. Be careful around extreme statements.

Here are examples of economics multiple-choice questions:

1. Which of the following is considered a capital resource in economics?

A. A short-term corporate bond
B. A Microsoft common share
C. A computer with software loaded on it
D. A Government of Canada T-bill security
E. All of the above

The answer is "C," because the definition of a capital resource is "a thing (like equipment, plant, inventory) already produced that we can use to produce other goods and services." No other answer fits the definition.

2. Real GDP is

A. the value of all goods and services produced in an economy.
B. the value of all goods and services produced only in homes.
C. the value of factory-produced goods and services.
D. the value of all goods and services produced in an economy measured in the prices of a given year.
E. none of the above.

The answer is D. It is the proper definition, and it is also the most general of the alternatives.

True-or-False Questions: These test your knowledge of concepts and facts. If you don't know which choice is correct, the risks of guessing are better than in a multiple-choice question. Look again for qualifiers in questions, and read every word carefully.

Here are two examples of economics true-or-false questions:

1. True or False?
Economics deals only with positive statements.
False. It also deals with normative, values, statements.

2. True or False?
The real wage rate is the quantity of goods and services that an hour's work will buy in an economy.
True. That's the concept and the definition.

Essay Questions: The marker looks for writing skill, grammatical precision, and organizational ability. Watch for verbs such as "explain," "identify and explain," and "explain using graphs and diagrams"—they are the cue to what is really being asked.

Budget your time carefully—these questions can be real time-wasters! Also, watch your handwriting—your instructor has to be able to read your work.

Here's an example of an economics essay question:

Identify and explain the factors that cause a shift to the left, or a shift to the right, in the supply curve. What happens to equilibrium price and quantity in each situation? To answer this question, you will need to clearly identify and clarify each of the key factors: Technology or state of technology, the number of firms, costs of inputs, prices of related products, and expected future prices.

You should be specific with respect to certain terms such as technology. You could identify fibre-optic wire, for example, as allowing supply to be increased in the communications and Internet fields. In your discussion of related products, you will need to explain the concepts of substitute (a good which can be used in place of another, such as CDs for audio tapes), and complement (goods used together, such as wine and cheese, or french fries and salt).

Finally, illustrate by drawing a supply curve moving right in each situation, meaning that if demand does not change, a new, lower equilibrium price will be established and a new, higher equilibrium quantity of goods is reached. If the supply curve moves left and demand does not change, then equilibrium price will be higher; and a new, lower, equilibrium is reached for a good or service.

These kinds of questions are not easy; they require you to be able to organize your material well, present material using words and diagrams, and integrate material nicely for the reader. You can practise by trying to figure out what kinds of questions would likely be covered by such questions, and writing your suggested answers beforehand.

Your Follow-up and Evaluation

Tests are an opportunity to see what you have learned, or have failed to learn, so far in the course. If you have done well, give yourself a treat. If you haven't done so well, put some effective study skills, such as those outlined in this article, to work for you. If you are having difficulties, talk to the instructor about how to improve your work.

A somewhat typical human reaction to poor results is to get angry with the instructor or to blame yourself. Use positive strategies for improvement. Positive strategies include talking to the instructor with respect to his suggestions, trying to find new ways to learn the material (e.g., computer-based assisted learning), and changing your schedule to do more within your given time restraints. Try to understand where you went wrong, and rewrite the questions with the solutions that were required. These techniques will improve your performance.

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