Question 1

Figure 2-13 
-Refer to Figure 2-13. Which points are not currently attainable but could become achievable for this economy if there is an improvement in technology?

Accepted Answer

A)   I, L
B)   G, H
C)   J, K
D)   F, GE) A) and B)
F) A) and C)

Question 2

The two basic reasons why economists often appear to give conflicting advice to policymakers are differences in

Accepted Answer

A)   opinions and education.
B)   opinions and values.
C)   scientific judgments and education.
D)   scientific judgments and values.E) All of the above
F) A) and C)

Question 3

The bowed shape of the production possibilities frontier can be explained by the fact that

Accepted Answer

A)   all resources are scarce.
B)   economic growth is always occurring.
C)   the opportunity cost of one good in terms of the other depends on how much of each good the economy is producing.
D)   the only way to get more of one good is to get less of the other.E) A) and B)
F) A) and C)

Question 4

Table 2-2
The following table contains some production possibilities for an economy for a given year:
 
-Refer to Table 2-2. If the production possibilities frontier is bowed outward, then "?" could be

Accepted Answer

A)   6000.
B)   5500.
C)   5000.
D)   4500.E) B) and C)
F) C) and D)

Question 5

Historical episodes are

Accepted Answer

A)   valuable to economists because they allow economists to see how the science of economics has evolved.
B)   valuable to economists because they allow economists to evaluate economic theories.
C)   not of concern to economists because economics is about predicting the future, not dwelling on the past.
D)   not of concern to economists because the exact circumstances of historical episodes are unlikely to be observed again.E) A) and D)
F) A) and B)

Question 6

In the circular flow diagram, when Daphne purchases a new mobile phone, she participates in the markets for

Accepted Answer

The answer of In the circular flow diagram, when Daphne...

Question 7

Economists at the U.S. Department of the Treasury help design U.S. coins and paper money.

Accepted Answer

A) True 
 B)False

Question 8

Positive statements can be evaluated using data alone, but normative statements cannot.

Accepted Answer

A) True 
 B)False

Question 9

According to the circular flow diagram, if Denny is the owner of a landscaping business and he just received $50 for mowing Mrs. Pendleton's lawn,

Accepted Answer

A)   the $50 represents a cost of production for Denny's firm.
B)   the $50 represents wages, rent, and profit to Denny's firm.
C)   Denny acts as a firm who interacted in the markets for factors of production with Mrs. Pendleton.
D)   Denny acts as a firm who interacted in the markets for goods and services with Mrs. Pendleton.E) A) and B)
F) B) and C)

Question 10

Figure 2-8 
-Refer to Figure 2-8. To reach point L, the economy would have to

Accepted Answer

A)   acquire more resources or experience a technological advance.
B)   begin using its available resources more efficiently than it is currently using them.
C)   shift resources away from the production of nails and toward the production of hammers.
D)   None of the above are correct; the economy will never be able to reach point L.E) B) and C)
F) C) and D)

Question 11

An assumption an economist might make while studying international trade is

Accepted Answer

A)   there are only two countries.
B)   countries only produce two goods.
C)   technology does not change.
D)   All of the above are possible assumptions.E) A) and D)
F) None of the above

Question 12

Figure 2-10
Panel a)  Panel b) 
  
-Refer to Figure 2-10, Panel a) . Production at point Y is

Accepted Answer

A)   impossible and inefficient.
B)   impossible but efficient.
C)   possible but inefficient.
D)   possible and efficient.E) B) and D)
F) A) and B)

Question 13

Normative statements describe how the world is, while positive statements prescribe how the world should be.

Accepted Answer

A) True 
 B)False

Question 14

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) A) and B)

Question 15

Figure 2-5 
-Refer to Figure 2-5. The opportunity cost of obtaining 40 additional dryers by moving from point D to point C is

Accepted Answer

A)   0 washers.
B)   20 washers.
C)   40 washers.
D)   None of the above; the economy cannot move from point D to point C.E) B) and D)
F) A) and D)

Question 16

Figure 2-22 
-Refer to Figure 2-22. What are the coordinates of point C?

Accepted Answer

The answer of Figure 2-22 
-Refer to Figure 2-22. What...

Question 17

Economic models

Accepted Answer

A)   are constructed to mirror reality as closely as possible, and in this respect economic models are no different from other scientific models.
B)   are constructed to mirror reality as closely as possible, and in this respect economic models are very different from other scientific models.
C)   are simplifications of reality, and in this respect economic models are no different from other scientific models.
D)   are simplifications of reality, and in this respect economic models are very different from other scientific models.E) All of the above
F) C) and D)

Question 18

Figure 2-14  Consider the production possibilities curve for a country that can produce sweaters, apples in bushels), or a combination of the two.
-Refer to Figure 2-14. Which points) on the graph isare) efficient production possibilities?

Accepted Answer

The answer of Figure 2-14  Consider the production possibilities...

Question 19

A demand curve shows the relationship between price and

Accepted Answer

A)   income.
B)   quantity demanded.
C)   production.
D)   income and quantity demanded.E) A) and C)
F) A) and B)

Question 20

Figure 2-5 
-Refer to Figure 2-5. It is not possible for this economy to produce at point

Accepted Answer

A)   A.
B)   B.
C)   C.
D)   D.E) A) and D)
F) All of the above

Exam 2: Thinking Like an Economist

Figure 2-8 -Refer to Figure 2-8. To reach point L, the economy would have to

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Table 2-2 The following table contains some production possibilities for an economy for a given year: -Refer to Table 2-2. If the production possibilities frontier is bowed outward, then "?" could be

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Positive statements can be evaluated using data alone, but normative statements cannot.

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Economists at the U.S. Department of the Treasury help design U.S. coins and paper money.

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Figure 2-13 -Refer to Figure 2-13. Which points are not currently attainable but could become achievable for this economy if there is an improvement in technology?

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A demand curve shows the relationship between price and

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In the circular flow diagram, when Daphne purchases a new mobile phone, she participates in the markets for

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According to the circular flow diagram, if Denny is the owner of a landscaping business and he just received $50 for mowing Mrs. Pendleton's lawn,

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The bowed shape of the production possibilities frontier can be explained by the fact that

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Figure 2-10 Panel a) Panel b) -Refer to Figure 2-10, Panel a) . Production at point Y is

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Figure 2-5 -Refer to Figure 2-5. The opportunity cost of obtaining 40 additional dryers by moving from point D to point C is

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Economic models

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Figure 2-22 -Refer to Figure 2-22. What are the coordinates of point C?

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Historical episodes are

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

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Figure 2-14 Consider the production possibilities curve for a country that can produce sweaters, apples in bushels), or a combination of the two. -Refer to Figure 2-14. Which points) on the graph isare) efficient production possibilities?

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The two basic reasons why economists often appear to give conflicting advice to policymakers are differences in

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Normative statements describe how the world is, while positive statements prescribe how the world should be.

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Figure 2-5 -Refer to Figure 2-5. It is not possible for this economy to produce at point

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An assumption an economist might make while studying international trade is

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