Question 1

Figure 2-5
 
-Refer to Figure 2-5.The opportunity cost of this economy moving from point A to point C is

Accepted Answer

A)   75 soccer balls.
B)   125 soccer balls.
C)   125 soccer balls and 240 sweaters.
D)   240 sweaters.E) B) and D)
F) B) and C)

Question 2

When economists are trying to explain the world,they are scientists,and when they are trying to help improve the world,they are policy advisers.

Accepted Answer

A) True 
 B)False

Question 3

Congress relies on economists at the Congressional Budget Office to

Accepted Answer

A)   enforce the nation's antitrust laws.
B)   set the nation's monetary policy.
C)   provide evidence that incumbent members of Congress are performing well in their jobs.
D)   provide independent evaluations of policy proposals.E) B) and C)
F) A) and D)

Question 4

In the circular-flow diagram,which of the following items does not flow from firms to households?

Accepted Answer

A)   goods
B)   services
C)   capital
D)   profitE) A) and D)
F) A) and C)

Question 5

Figure 2-11
 
-Refer to Figure 2-11.The shift of the production possibilities frontier from A to B can best be described as

Accepted Answer

A)   a downturn in the economy.
B)   economic growth.
C)   an enhancement of equality.
D)   an improvement in the allocation of resources.E) All of the above
F) C) and D)

Question 6

Figure 2-6
 
-Refer to Figure 2-6.What is the opportunity cost of moving from point A to point B?

Accepted Answer

A)   zero
B)   6 clocks
C)   6 clocks and 15 candles
D)   15 candlesE) A) and B)
F) None of the above

Question 7

"Allowing all individuals access to Medicare and Medicaid for health insurance is the fair thing to do" is an example of a

Accepted Answer

A)   contradiction in economic theory.
B)   positive economic statement.
C)   negative economic statement.
D)   normative economic statement.E) B) and D)
F) A) and B)

Question 8

Which of the following statements about economic models is correct?

Accepted Answer

A)   Economic models are built to mirror reality exactly.
B)   Economic models are useful, but they should not be used for the purpose of improving public policies.
C)   Because economic models omit many details, they allow us to see what is truly important.
D)   Economic models seldom incorporate equations or diagrams.E) A) and B)
F) A) and C)

Question 9

The slope of a fairly flat upward-sloping line will be a

Accepted Answer

A)   small positive number.
B)   large positive number.
C)   small negative number.
D)   large negative number.E) None of the above
F) All of the above

Question 10

Changes in one variable on a graph might be caused by the other variable on the graph or by a third omitted variable.

Accepted Answer

A) True 
 B)False

Question 11

A production point is said to be efficient if there is no way for the economy to produce more of one good without producing less of another.

Accepted Answer

A) True 
 B)False

Question 12

For economists,historical episodes

Accepted Answer

A)   are not worthy of study because they offer few insights into current economic events and problems.
B)   are not worthy of study because laboratory experiments provide more reliable data.
C)   are worthy of study because economists rely entirely on observation, rather than on theory.
D)   are worthy of study because they serve as valuable substitutes for laboratory experiments.E) A) and B)
F) A) and C)

Question 13

Any point on a country's production possibilities frontier represents a combination of two goods that an economy

Accepted Answer

A)   will never be able to produce.
B)   can produce using all available resources and technology.
C)   can produce using some portion, but not all, of its resources and technology.
D)   may be able to produce in the future with more resources and/or superior technology.E) All of the above
F) None of the above

Question 14

Figure 2-4
 
-Refer to Figure 2-4.The opportunity cost of obtaining 20 additional lamps by moving from point W to point V is

Accepted Answer

A)   0 notepads.
B)   10 notepads.
C)   50 notepads.
D)   None of the above; the economy cannot move from point W to point V.E) A) and B)
F) None of the above

Question 15

Different values are not a reason for disagreement among economists.

Accepted Answer

A) True 
 B)False

Question 16

A production possibilities frontier has a bowed shape if the opportunity cost is constant at all levels of output.

Accepted Answer

A) True 
 B)False

Question 17

When a production possibilities frontier is bowed outward,the opportunity cost of one good in terms of the other depends on how much of each good is being produced.

Accepted Answer

A) True 
 B)False

Question 18

Two variables that have a positive correlation move in the same direction.

Accepted Answer

A) True 
 B)False

Question 19

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) A) and B)
F) None of the above

Question 20

A technological advance in the production of the first good increases the opportunity cost of the first good in terms of the second good.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist.

When economists are trying to explain the world,they are scientists,and when they are trying to help improve the world,they are policy advisers.

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Which of the following statements about economic models is correct?

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Figure 2-4 -Refer to Figure 2-4.The opportunity cost of obtaining 20 additional lamps by moving from point W to point V is

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In the circular-flow diagram,which of the following items does not flow from firms to households?

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The slope of a fairly flat upward-sloping line will be a

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Figure 2-11 -Refer to Figure 2-11.The shift of the production possibilities frontier from A to B can best be described as

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Congress relies on economists at the Congressional Budget Office to

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Figure 2-6 -Refer to Figure 2-6.What is the opportunity cost of moving from point A to point B?

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A production possibilities frontier has a bowed shape if the opportunity cost is constant at all levels of output.

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"Allowing all individuals access to Medicare and Medicaid for health insurance is the fair thing to do" is an example of a

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The scientific method is applicable to studying

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Any point on a country's production possibilities frontier represents a combination of two goods that an economy

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A technological advance in the production of the first good increases the opportunity cost of the first good in terms of the second good.

Correct AnswerverifiedShow Answer

Two variables that have a positive correlation move in the same direction.

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For economists,historical episodes

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A production point is said to be efficient if there is no way for the economy to produce more of one good without producing less of another.

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When a production possibilities frontier is bowed outward,the opportunity cost of one good in terms of the other depends on how much of each good is being produced.

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Figure 2-5 -Refer to Figure 2-5.The opportunity cost of this economy moving from point A to point C is

Correct AnswerverifiedShow Answer

Changes in one variable on a graph might be caused by the other variable on the graph or by a third omitted variable.

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Different values are not a reason for disagreement among economists.

Correct AnswerverifiedShow Answer

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