Question 1

Positive statements are

Accepted Answer

A)   prescriptive.
B)   claims about how the world should be.
C)   claims about how the world is.
D)   made by economists speaking as policy advisers.E) A) and D)
F) B) and C)

Question 2

Figure 2-22 
-Refer to Figure 2-22. Is a move from point A to point B considered a shift of the curve or a movement along the curve?

Accepted Answer

movement a...

Question 3

A certain production possibilities frontier shows production possibilities for two goods, jewelry and clothing. Which of the following concepts cannot be illustrated by this model?

Accepted Answer

A)   the flow of dollars between sellers of jewelry and clothing and buyers of jewelry and clothing
B)   the tradeoff between production of jewelry and production of clothing
C)   the opportunity cost of clothing in terms of jewelry
D)   the effect of economic growth on production possibilities involving jewelry and clothingE) A) and D)
F) None of the above

Question 4

Figure 2-15 
-Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of each car is

Accepted Answer

A)   the slope of the production possibilities frontier.
B)   3/2 sofas.
C)   2/3 of a sofa.
D)   Both a and b are correct.E) B) and C)
F) A) and B)

Question 5

In the simple circular-flow diagram, households

Accepted Answer

A)   are the only decision makers.
B)   own the factors of production.
C)   are buyers of inputs.
D)   consume only some of the goods and services that firms produce.E) A) and C)
F) All of the above

Question 6

In the circular-flow diagram, factors of production include land, labor, and capital.

Accepted Answer

A) True 
 B)False

Question 7

Unemployment causes production levels to be inefficient.

Accepted Answer

A) True 
 B)False

Question 8

A statement describing how the world is

Accepted Answer

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

Question 9

A macroeconomist, rather than a microeconomist, would study the effects on a market from two firms merging.

Accepted Answer

A) True 
 B)False

Question 10

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 combination of points show production possibilities only achievable with improvements in technology or increases in resources?

Accepted Answer

A)   Q, R, U, and V
B)   S and X
C)   T and W
D)   None of the above is correct.E) A) and B)
F) All of the above

Question 11

In the circular-flow diagram, firms produce goods and services using the factors of production.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following areas of study typifies microeconomics as opposed to macroeconomics?

Accepted Answer

A)   the impact of minimum-wage laws on employment in the fast food industry
B)   the effect of changes in household saving rates on the growth rate of national income
C)   the impact of faster money growth on the rate of inflation
D)   a comparison of alternative tax policies and their respective impacts on the rate of the nation's economic growthE) A) and C)
F) All of the above

Question 13

Duties of the Council of Economic Advisers include

Accepted Answer

A)   advising the president and writing the annual Economic Report of the President.
B)   implementing the president's tax policies.
C)   tracking the behavior of the nation's money supply.
D)   All of the above are correct.E) None of the above
F) C) and D)

Question 14

When a variable that is not named on either axis of a graph changes, we read the change as a movement along the curve.

Accepted Answer

A) True 
 B)False

Question 15

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) A) and C)

Question 16

Figure 2-15 
-Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of one car is

Accepted Answer

The answer of Figure 2-15 
-Refer to Figure 2-15. Consider...

Question 17

Just like models constructed in other areas of science, economic models

Accepted Answer

A)   incorporate assumptions that contradict reality.
B)   incorporate all details of the real world.
C)   complicate reality.
D)   avoid the use of diagrams and equations.E) B) and C)
F) A) and B)

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

A model that shows how dollars flow through markets among households and firms is called the

Accepted Answer

A)   production possibilities frontier.
B)   circular-flow diagram.
C)   demand and supply diagram.
D)   comparative advantage model.E) None of the above
F) All of the above

Question 20

Figure 2-10
Panel a)  Panel b) 
  
-Refer to Figure 2-10, Panel a)  and Panel b) . Which of the following is not a result of the shift of the economy's production possibilities frontier from Panel a)  to Panel b) ?

Accepted Answer

A)   The tradeoff between the production of tractors and sofas changes.
B)   Production of 2 tractors and 10 sofas becomes efficient.
C)   Production of 6 tractors and 14 sofas becomes possible.
D)   The opportunity cost of a sofa is higher at all levels of sofa production.E) A) and D)
F) A) and C)

Exam 2: Thinking Like an Economist

Unemployment causes production levels to be inefficient.

Correct Answer
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Figure 2-15 -Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of one car is

Correct Answer
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Positive statements are

Correct Answer
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Duties of the Council of Economic Advisers include

Correct Answer
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Correct Answer
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A certain production possibilities frontier shows production possibilities for two goods, jewelry and clothing. Which of the following concepts cannot be illustrated by this model?

Correct Answer
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A statement describing how the world is

Correct Answer
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In the circular-flow diagram, firms produce goods and services using the factors of production.

Correct Answer
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Figure 2-22 -Refer to Figure 2-22. Is a move from point A to point B considered a shift of the curve or a movement along the curve?

Correct Answer
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movement a...
View Answer

In the simple circular-flow diagram, households

Correct Answer
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Just like models constructed in other areas of science, economic models

Correct Answer
verified

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

Correct Answer
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In the circular-flow diagram, factors of production include land, labor, and capital.

Correct Answer
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Figure 2-15 -Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of each car is

Correct Answer
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Figure 2-10 Panel a) Panel b) -Refer to Figure 2-10, Panel a) and Panel b) . Which of the following is not a result of the shift of the economy's production possibilities frontier from Panel a) to Panel b) ?

Correct Answer
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A macroeconomist, rather than a microeconomist, would study the effects on a market from two firms merging.

Correct Answer
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When a variable that is not named on either axis of a graph changes, we read the change as a movement along the curve.

Correct Answer
verified

A model that shows how dollars flow through markets among households and firms is called the

Correct Answer
verified

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

Correct Answer
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Which of the following areas of study typifies microeconomics as opposed to macroeconomics?

Correct Answer
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Exam 2: Thinking Like an Economist

Unemployment causes production levels to be inefficient.

Correct AnswerverifiedShow Answer

Figure 2-15 -Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of one car is

Correct AnswerverifiedShow Answer

Positive statements are

Correct AnswerverifiedShow Answer

Duties of the Council of Economic Advisers include

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A certain production possibilities frontier shows production possibilities for two goods, jewelry and clothing. Which of the following concepts cannot be illustrated by this model?

Correct AnswerverifiedShow Answer

A statement describing how the world is

Correct AnswerverifiedShow Answer

In the circular-flow diagram, firms produce goods and services using the factors of production.

Correct AnswerverifiedShow Answer

Figure 2-22 -Refer to Figure 2-22. Is a move from point A to point B considered a shift of the curve or a movement along the curve?

Correct Answerverifiedmovement a...View AnswerShow Answer

In the simple circular-flow diagram, households

Correct AnswerverifiedShow Answer

Just like models constructed in other areas of science, economic models

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

In the circular-flow diagram, factors of production include land, labor, and capital.

Correct AnswerverifiedShow Answer

Figure 2-15 -Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of each car is

Correct AnswerverifiedShow Answer

Figure 2-10 Panel a) Panel b) -Refer to Figure 2-10, Panel a) and Panel b) . Which of the following is not a result of the shift of the economy's production possibilities frontier from Panel a) to Panel b) ?

Correct AnswerverifiedShow Answer

A macroeconomist, rather than a microeconomist, would study the effects on a market from two firms merging.

Correct AnswerverifiedShow Answer

When a variable that is not named on either axis of a graph changes, we read the change as a movement along the curve.

Correct AnswerverifiedShow Answer

A model that shows how dollars flow through markets among households and firms is called the

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following areas of study typifies microeconomics as opposed to macroeconomics?

Correct AnswerverifiedShow Answer

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movement a...
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