Question 1

Which of the following statements is correct about the roles of economists?

Accepted Answer

A)   Economists are best viewed as policy advisers.
B)   Economists are best viewed as scientists.
C)   In trying to explain the world, economists are policy advisers; in trying to improve the world, they are scientists.
D)   In trying to explain the world, economists are scientists; in trying to improve the world, they are policy advisers.E) A) and B)
F) B) and C)

Question 2

Economists at which of the following offices help formulate spending plans and regulatory policies?

Accepted Answer

A)   Office of Management and Budget
B)   Department of the Treasury
C)   Congressional Budget Office
D)   The Federal ReserveE) A) and C)
F) B) and C)

Question 3

Which of the following is a correct statement about production possibilities frontiers?

Accepted Answer

A)   An economy can produce only on the production possibilities frontier.
B)   An economy can produce at any point inside or outside a production possibilities frontier.
C)   An economy can produce at any point on or inside the production possibilities frontier, but not outside the frontier.
D)   An economy can produce at any point inside the production possibilities frontier, but not on or outside the frontier.E) All of the above
F) B) and C)

Question 4

Economists at which administrative department analyze data on workers and those looking for work to help formulate labor-market policies?

Accepted Answer

The answer of Economists at which administrative department analyze data...

Question 5

For economists, statements about the world are of two types:

Accepted Answer

A)   assumptions and theories.
B)   true statements and false statements.
C)   specific statements and general statements.
D)   positive statements and normative statements.E) None of the above
F) All of the above

Question 6

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

Accepted Answer

A) True 
 B)False

Question 7

Since economists cannot use natural experiments offered by history, they must use carefully constructed laboratory experiments instead.

Accepted Answer

A) True 
 B)False

Question 8

Suppose that someone makes the argument that because empty alcohol containers are found at many accidents, the containers cause accidents. This would be an example of

Accepted Answer

A)   sound logic.
B)   reverse causality.
C)   omitted variables.
D)   bias.E) B) and C)
F) C) and D)

Question 9

The use of theory and observation is more difficult in economics than in sciences such as physics due to the difficulty in

Accepted Answer

A)   performing an experiment in an economic system.
B)   applying mathematical methods to economic analysis.
C)   analyzing available data.
D)   formulating theories about economic events.E) B) and D)
F) A) and B)

Question 10

Which of the following is an example of using the scientific method with a natural experiment?

Accepted Answer

A)   measuring how long it takes a marble to fall from a ten story building
B)   comparing plant growth with and without a soil additive
C)   tracking the price of oil when a war in the Middle East interrupts the flow of crude oil
D)   observing the reaction when two chemicals are mixed togetherE) B) and C)
F) C) and D)

Question 11

When economists make positive statements, they are

Accepted Answer

A)   speaking as scientists.
B)   speaking as policy advisers.
C)   making claims about how the world should be.
D)   revealing that they are very conservative in their views of how the world works.E) B) and D)
F) None of the above

Question 12

In the markets for goods and services in the circular flow diagram, households act as

Accepted Answer

The answer of In the markets for goods and services...

Question 13

In the circular-flow diagram,

Accepted Answer

A)   taxes flow from households to firms, and transfer payments flow from firms to households.
B)   income payments flow from firms to households, and sales revenue flows from households to firms.
C)   resources flow from firms to households, and goods and services flow from households to firms.
D)   inputs and outputs flow in the same direction as the flow of dollars, from firms to households.E) C) and D)
F) All of the above

Question 14

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) B) and C)
F) A) and D)

Question 15

Examples of graphs of a single variable include pie charts, bar graphs, and time-series graphs.

Accepted Answer

A) True 
 B)False

Question 16

Use the following Figure to answer the question : Figure 2-12 
-Refer to Figure 2-12. Which of the following would most likely have caused the production possibilities frontier to shift outward from A to B?

Accepted Answer

A)   a decrease in unemployment
B)   a technological advance in the consumer goods industries
C)   a general technological advance
D)   an increase in the availability of capital-producing resourcesE) A) and B)
F) None of the above

Question 17

In principle, we can

Accepted Answer

A)   ignore positive statements when choosing among various public policy alternatives.
B)   ignore normative statements when choosing among various public policy alternatives.
C)   confirm or refute positive statements by examining evidence.
D)   confirm or refute normative statements by examining evidence.E) C) and D)
F) B) and D)

Question 18

Economic models are built with

Accepted Answer

A)   recommendations concerning public policies.
B)   facts about the legal system.
C)   assumptions.
D)   statistical forecasts.E) None of the above
F) A) and B)

Question 19

When an economy is operating at a point on its production possibilities frontier, then

Accepted Answer

A)   consumers are content with the mix of goods and services that is being produced.
B)   there is no way to produce more of one good without producing less of the other.
C)   equal amounts of the two goods are being produced.
D)   All of the above are correct.E) B) and D)
F) B) and C)

Question 20

Use the following Figure to answer the question : Figure 2-17 
-Refer to Figure 2-17. The slope of the curve between points A and B is

Accepted Answer

A)   -5
B)   -1/5
C)   1/5
D)   5E) A) and D)
F) A) and C)

Exam 2: Thinking Like an Economist

In the markets for goods and services in the circular flow diagram, households act as

Correct AnswerverifiedShow Answer

When economists make positive statements, they are

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In principle, we can

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The use of theory and observation is more difficult in economics than in sciences such as physics due to the difficulty in

Correct AnswerverifiedShow Answer

For economists, statements about the world are of two types:

Correct AnswerverifiedShow Answer

Use the following Figure to answer the question : Figure 2-17 -Refer to Figure 2-17. The slope of the curve between points A and B is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Economists at which administrative department analyze data on workers and those looking for work to help formulate labor-market policies?

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Which of the following statements is correct about the roles of economists?

Correct AnswerverifiedShow Answer

Examples of graphs of a single variable include pie charts, bar graphs, and time-series graphs.

Correct AnswerverifiedShow Answer

In the circular-flow diagram,

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When an economy is operating at a point on its production possibilities frontier, then

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Suppose that someone makes the argument that because empty alcohol containers are found at many accidents, the containers cause accidents. This would be an example of

Correct AnswerverifiedShow Answer

Economists at which of the following offices help formulate spending plans and regulatory policies?

Correct AnswerverifiedShow Answer

Use the following Figure to answer the question : Figure 2-12 -Refer to Figure 2-12. Which of the following would most likely have caused the production possibilities frontier to shift outward from A to B?

Correct AnswerverifiedShow Answer

Which of the following is an example of using the scientific method with a natural experiment?

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Which of the following is a correct statement about production possibilities frontiers?

Correct AnswerverifiedShow Answer

Historical episodes are

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Economic models are built with

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Since economists cannot use natural experiments offered by history, they must use carefully constructed laboratory experiments instead.

Correct AnswerverifiedShow Answer

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