Question 1

The scientific method is applicable to studying

Accepted Answer

A)   natural sciences, but not social sciences.
B)   social sciences, but not natural sciences.
C)   both natural sciences and social sciences.
D)   None of the above is correct.E) None of the above
F) B) and C)

Question 2

Economic growth causes a production possibilities frontier to shift outward.

Accepted Answer

A) True 
 B)False

Question 3

Figure 2-23 
-Refer to Figure 2-23. It is possible for this economy to produce 45 doghouses and 30 dishwashers.

Accepted Answer

A) True 
 B)False

Question 4

There is only one explanation for why economists give conflicting advice on policy issues, and it is that they have different values about what policy should try to accomplish.

Accepted Answer

A) True 
 B)False

Question 5

When a relevant variable that is not named on either axis changes,

Accepted Answer

A)   there will be a movement along the curve.
B)   the curve will rotate clockwise.
C)   the curve will be unaffected since only the variables on the axis affect the curve.
D)   the curve will shift.E) C) and D)
F) B) and D)

Question 6

The inner loop of the circular-flow diagram represents the flows of inputs and outputs. Which of the following does not appear on the inner loop?

Accepted Answer

A)   wages
B)   land
C)   capital
D)   goods and services soldE) All of the above
F) C) and D)

Question 7

The language of economics is

Accepted Answer

A)   needlessly arcane.
B)   valuable because it provides a new and useful way of learning about the world.
C)   easy to learn within a day.
D)   unnecessary to learn for a thorough understanding of economics.E) A) and C)
F) None of the above

Question 8

Figure 2-10
Panel a)  Panel b) 
  
-Refer to Figure 2-10, Panel a) . The movement from point W to point Y could be caused by

Accepted Answer

A)   economic growth.
B)   unemployment.
C)   an improvement in efficiency.
D)   an advance in production technology.E) A) and D)
F) A) and C)

Question 9

Which of the following is not held constant when looking at an individual's demand curve?

Accepted Answer

A)   income
B)   price
C)   preferences
D)   the availability of alternative goodsE) A) and B)
F) A) and C)

Question 10

A normative economic statement such as "The minimum wage should be abolished"

Accepted Answer

A)   would likely be made by an economist acting as a scientist.
B)   would require values and data to be evaluated.
C)   would require data but not values to be evaluated.
D)   could not be evaluated by economists acting as policy advisers.E) C) and D)
F) B) and D)

Question 11

Suppose an economy produces two goods, food and machines. This economy always operates on its production possibilities frontier. Last year, it produced 1000 units of food and 47 machines. This year it experienced a technological advance in its machine-making industry. As a result, this year the society wants to produce 1050 units of food and 47 machines. Which of the following statements is correct?

Accepted Answer

A)   Because the technological advance occurred in the machine-making industry, it will not be possible to increase food production without reducing machine production below 47.
B)   Because the technological advance occurred in the machine-making industry, increases in output can only occur in the machine industry.
C)   In order to increase food production in these circumstances without reducing machine production, the economy must reduce inefficiencies.
D)   The technological advance reduced the amount of resources needed to produce 47 machines, so these resources could be used to produce more food.E) B) and C)
F) A) and B)

Question 12

A statement describing how the world should be

Accepted Answer

A)   is a normative statement.
B)   is a positive statement.
C)   would only be made by an economist speaking as a scientist.
D)   would only be made by an economist employed by the government.E) B) and C)
F) A) and C)

Question 13

Figure 2-23 
-Refer to Figure 2-23. It is possible for this economy to produce 30 doghouses and 20 dishwashers.

Accepted Answer

A) True 
 B)False

Question 14

Figure 2-9
Panel a)  Panel b) 
  
-Refer to Figure 2-9, Panel a) . The opportunity cost of one cup of coffee is highest when the economy produces

Accepted Answer

A)   0 cups of coffee.
B)   2 cups of coffee.
C)   4 cups of coffee.
D)   6 cups of coffee.E) All of the above
F) B) and D)

Question 15

When two variables move in opposite directions, the curve relating them is upward sloping, and we say the variables are positively related.

Accepted Answer

A) True 
 B)False

Question 16

Where can an economy not produce?

Accepted Answer

A)   inside its production possibilities frontier
B)   on its production possibilities frontier
C)   outside its production possibilities frontier
D)   at the endpoints of its production possibilities frontierE) B) and C)
F) C) and D)

Question 17

The nation's antitrust laws are enforced by economists at the Department of

Accepted Answer

A)   Labor.
B)   Health and Human Services.
C)   Justice.
D)   Treasury.E) All of the above
F) A) and B)

Question 18

Assumptions can simplify the complex world and make it easier to understand.

Accepted Answer

A) True 
 B)False

Question 19

Production is efficient if the economy is producing at a point

Accepted Answer

A)   on the production possibilities frontier.
B)   outside the production possibilities frontier.
C)   on or inside the production possibilities frontier.
D)   inside the production possibilities frontier.E) B) and D)
F) B) and C)

Question 20

Figure 2-7 
-Refer to Figure 2-7. Inefficient production is represented by which points) ?

Accepted Answer

A)   L, M
B)   N, O, P, Q
C)   N, O, P
D)   QE) A) and D)
F) A) and B)

Exam 2: Thinking Like an Economist

Where can an economy not produce?

Correct Answer
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The language of economics is

Correct Answer
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A statement describing how the world should be

Correct Answer
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The scientific method is applicable to studying

Correct Answer
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Figure 2-23 -Refer to Figure 2-23. It is possible for this economy to produce 45 doghouses and 30 dishwashers.

Correct Answer
verified

Figure 2-7 -Refer to Figure 2-7. Inefficient production is represented by which points) ?

Correct Answer
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When a relevant variable that is not named on either axis changes,

Correct Answer
verified

Correct Answer
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Figure 2-23 -Refer to Figure 2-23. It is possible for this economy to produce 30 doghouses and 20 dishwashers.

Correct Answer
verified

The inner loop of the circular-flow diagram represents the flows of inputs and outputs. Which of the following does not appear on the inner loop?

Correct Answer
verified

Production is efficient if the economy is producing at a point

Correct Answer
verified

Which of the following is not held constant when looking at an individual's demand curve?

Correct Answer
verified

Economic growth causes a production possibilities frontier to shift outward.

Correct Answer
verified

There is only one explanation for why economists give conflicting advice on policy issues, and it is that they have different values about what policy should try to accomplish.

Correct Answer
verified

Figure 2-9 Panel a) Panel b) -Refer to Figure 2-9, Panel a) . The opportunity cost of one cup of coffee is highest when the economy produces

Correct Answer
verified

When two variables move in opposite directions, the curve relating them is upward sloping, and we say the variables are positively related.

Correct Answer
verified

Assumptions can simplify the complex world and make it easier to understand.

Correct Answer
verified

The nation's antitrust laws are enforced by economists at the Department of

Correct Answer
verified

Figure 2-10 Panel a) Panel b) -Refer to Figure 2-10, Panel a) . The movement from point W to point Y could be caused by

Correct Answer
verified

A normative economic statement such as "The minimum wage should be abolished"

Correct Answer
verified

Exam 2: Thinking Like an Economist

Where can an economy not produce?

Correct AnswerverifiedShow Answer

The language of economics is

Correct AnswerverifiedShow Answer

A statement describing how the world should be

Correct AnswerverifiedShow Answer

The scientific method is applicable to studying

Correct AnswerverifiedShow Answer

Figure 2-23 -Refer to Figure 2-23. It is possible for this economy to produce 45 doghouses and 30 dishwashers.

Correct AnswerverifiedShow Answer

Figure 2-7 -Refer to Figure 2-7. Inefficient production is represented by which points) ?

Correct AnswerverifiedShow Answer

When a relevant variable that is not named on either axis changes,

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 2-23 -Refer to Figure 2-23. It is possible for this economy to produce 30 doghouses and 20 dishwashers.

Correct AnswerverifiedShow Answer

The inner loop of the circular-flow diagram represents the flows of inputs and outputs. Which of the following does not appear on the inner loop?

Correct AnswerverifiedShow Answer

Production is efficient if the economy is producing at a point

Correct AnswerverifiedShow Answer

Which of the following is not held constant when looking at an individual's demand curve?

Correct AnswerverifiedShow Answer

Economic growth causes a production possibilities frontier to shift outward.

Correct AnswerverifiedShow Answer

There is only one explanation for why economists give conflicting advice on policy issues, and it is that they have different values about what policy should try to accomplish.

Correct AnswerverifiedShow Answer

Figure 2-9 Panel a) Panel b) -Refer to Figure 2-9, Panel a) . The opportunity cost of one cup of coffee is highest when the economy produces

Correct AnswerverifiedShow Answer

When two variables move in opposite directions, the curve relating them is upward sloping, and we say the variables are positively related.

Correct AnswerverifiedShow Answer

Assumptions can simplify the complex world and make it easier to understand.

Correct AnswerverifiedShow Answer

The nation's antitrust laws are enforced by economists at the Department of

Correct AnswerverifiedShow Answer

Figure 2-10 Panel a) Panel b) -Refer to Figure 2-10, Panel a) . The movement from point W to point Y could be caused by

Correct AnswerverifiedShow Answer

A normative economic statement such as "The minimum wage should be abolished"

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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