Question 1

When economists are trying to explain the world, they are

Accepted Answer

A)  scientists.
B)  policy advisers.
C)  in the realm of microeconomics rather than macroeconomics.
D)  in the realm of normative economics rather than positive economics.E) C) and D)
F) A) and D)

Question 2

Table 2-4
Production Possibilities for Picnicland 
-Refer to Table 2-4. What is the opportunity cost to Picnicland of increasing the production of burgers from 450 to 750?

Accepted Answer

A)  150 hotdogs
B)  225 hotdogs
C)  300 hotdogs
D)  450 hotdogsE) A) and D)
F) None of the above

Question 3

Figure 2-7 
-Refer to Figure 2-7. This economy cannot produce at which point(s) ?

Accepted Answer

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

Question 4

The decision of which assumptions to make is

Accepted Answer

A)  an easy decision for an economist, but a difficult decision for a physicist or a chemist.
B)  not a particularly important decision for an economist.
C)  usually regarded as an art in scientific thinking.
D)  usually regarded as the easiest part of the scientific method.E) None of the above
F) A) and D)

Question 5

Policymaking in a representative democracy

Accepted Answer

A)  is straightforward and does not involve any disagreement.
B)  benefits from the input of economists, even if their advice is not always followed.
C)  is conducted without the input of economists.
D)  is always based exclusively on the results of economic analysis.E) A) and C)
F) C) and D)

Question 6

Between the two ordered pairs (3, 6)  and (7, 18) , the slope is

Accepted Answer

A)  1/3
B)  -1/3.
C)  3.
D)  -3.E) All of the above
F) C) and D)

Question 7

Economic models

Accepted Answer

A)  cannot be useful if they are based on false assumptions.
B)  were once thought to be useful, but that is no longer true.
C)  must incorporate all aspects of the economy if they are to be useful.
D)  can be useful, even if they are not particularly realistic.E) All of the above
F) A) and B)

Question 8

Figure 2-14 
-Refer to Figure 2-14. Unemployment could cause this economy to produce at point B.

Accepted Answer

A) True 
 B)False

Question 9

What type of statement is a descriptive statement about how the world is?

Accepted Answer

The answer of What type of statement is a descriptive...

Question 10

An outcome is said to be efficient if an economy is conserving the largest possible quantity of its scarce resources while still meeting the basic needs of society.

Accepted Answer

A) True 
 B)False

Question 11

A demand curve shows the relationship

Accepted Answer

A)  between income and quantity demanded.
B)  between price and income.
C)  between price and quantity demanded.
D)  among income, price, and quantity demanded.E) B) and C)
F) A) and C)

Question 12

The Council of Economic Advisers

Accepted Answer

A)  was created in 1946.
B)  advises the president of the United States on economic policy matters.
C)  writes the annual Economic Report of the President.
D)  All of the above are correct.E) B) and D)
F) B) and C)

Question 13

Which of the following statements about the circular-flow diagram is correct?

Accepted Answer

A)  One must imagine that the economy operates without money in order to make sense of the diagram.
B)  The diagram leaves out details that are not essential for understanding the economic transactions that occur between households and firms.
C)  The government cannot be excluded as a decision maker in a circular-flow diagram.
D)  All of the above are correct.E) A) and C)
F) None of the above

Question 14

When economists are trying to help improve the world, they are

Accepted Answer

A)  in the realm of positive economics rather than normative economics.
B)  in the realm of macroeconomics rather than microeconomics.
C)  scientists.
D)  policy advisers.E) None of the above
F) All of the above

Question 15

When a production possibilities frontier is bowed outward, the opportunity cost of one good in terms of the other is constant.

Accepted Answer

A) True 
 B)False

Question 16

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. If this society moves from point U to point V,

Accepted Answer

A)  it gives up 40 bushels of apples to get 80 sweaters.
B)  it gives up 140 bushels of apples to get 80 sweaters.
C)  it gives up 80 sweaters to get 140 bushels of apples.
D)  it gives up 80 sweaters to get 40 bushels of apples.E) B) and C)
F) None of the above

Question 17

An economic model can accurately explain how the economy is organized because it is designed to include, to the extent possible, all features of the real world.

Accepted Answer

A) True 
 B)False

Question 18

Figure 2-13 
-Refer to Figure 2-13. One difference between points F and G is that

Accepted Answer

A)  Point G is unattainable with current resources, but point F is attainable.
B)  All resources are fully employed at point F but there is unemployment at point G.
C)  More output can be produced at point F but no additional output can be produced at point G.
D)  This economy produces more cookies at point G than at point F.E) A) and B)
F) None of the above

Question 19

Economists usually have to make do with whatever data the world happens to give them.

Accepted Answer

A) True 
 B)False

Question 20

"The US should not restrict employers from outsourcing work to foreign countries" is a normative statement.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist

An economic model can accurately explain how the economy is organized because it is designed to include, to the extent possible, all features of the real world.

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Economists usually have to make do with whatever data the world happens to give them.

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Policymaking in a representative democracy

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What type of statement is a descriptive statement about how the world is?

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The decision of which assumptions to make is

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The Council of Economic Advisers

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A demand curve shows the relationship

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An outcome is said to be efficient if an economy is conserving the largest possible quantity of its scarce resources while still meeting the basic needs of society.

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Between the two ordered pairs (3, 6) and (7, 18) , the slope is

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When economists are trying to help improve the world, they are

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"The US should not restrict employers from outsourcing work to foreign countries" is a normative statement.

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Which of the following statements about the circular-flow diagram is correct?

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When economists are trying to explain the world, they are

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Table 2-4 Production Possibilities for Picnicland -Refer to Table 2-4. What is the opportunity cost to Picnicland of increasing the production of burgers from 450 to 750?

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Figure 2-13 -Refer to Figure 2-13. One difference between points F and G is that

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Figure 2-14 -Refer to Figure 2-14. Unemployment could cause this economy to produce at point B.

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Figure 2-7 -Refer to Figure 2-7. This economy cannot produce at which point(s) ?

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Economic models

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When a production possibilities frontier is bowed outward, the opportunity cost of one good in terms of the other is constant.

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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. If this society moves from point U to point V,

Correct AnswerverifiedShow Answer

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