Question 1

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

Question 2

While the production possibilities frontier is a useful model, it cannot be used to illustrate economic growth.

Accepted Answer

A) True 
 B)False

Question 3

Economists speaking like scientists make

Accepted Answer

A)   normative statements.
B)   prescriptive statements.
C)   claims about how the world is.
D)   claims about how the world should be.E) None of the above
F) A) and B)

Question 4

Figure 2-4 
-Refer to Figure 2-4. Unemployment could cause this economy to produce at which points) ?

Accepted Answer

A)   Q, S
B)   Q, S, T
C)   R, U
D)   TE) None of the above
F) A) and D)

Question 5

Figure 2-2 
-Refer to Figure 2-2. Boxes A and B of this circular-flow diagram represent

Accepted Answer

A)   firms and households.
B)   households and government.
C)   the markets for goods and services and the markets for financial assets.
D)   the markets for goods and the markets for services.E) B) and D)
F) A) and B)

Question 6

Table 2-6
 
-Refer to Table 2-6. Consider the production possibilities table for an economy that produces only mobile phones and pizzas. What is the opportunity cost of increasing production of pizzas from 4,000 to 6,000?

Accepted Answer

The answer of Table 2-6
 
-Refer to Table 2-6. Consider...

Question 7

Figure 2-5 
-Refer to Figure 2-5. Inefficient production is represented by which points) ?

Accepted Answer

A)   A, B
B)   C
C)   C, D
D)   DE) C) and D)
F) A) and D)

Question 8

In the markets for goods and services in the circular-flow diagram,

Accepted Answer

A)   households provide firms with savings for investment.
B)   households provide firms with labor, land, and capital.
C)   firms provide households with output.
D)   firms provide households with profit.E) A) and B)
F) A) and C)

Question 9

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

Question 10

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) A) and D)

Question 11

A production possibilities frontier will be bowed outward if some of the economy's resources are better suited to producing one good than another.

Accepted Answer

A) True 
 B)False

Question 12

The production possibilities frontier is a graph that shows the various combinations of output that an economy can possibly produce given the available factors of production and

Accepted Answer

A)   society's preferences.
B)   the available production technology.
C)   a fair distribution of the output.
D)   the available demand for the output.E) B) and D)
F) B) and C)

Question 13

Figure 2-23 
-Refer to Figure 2-23. Given the technology available for manufacturing doghouses and dishwashers, this economy does not have enough of the factors of production to support the level of output represented by point C.

Accepted Answer

A) True 
 B)False

Question 14

Economists acting as scientists make positive statements, while economists acting as policy advisers make normative statements.

Accepted Answer

A) True 
 B)False

Question 15

The outer loop of the circular-flow diagram represents the flows of dollars in the economy. Which of the following does not appear on the outer loop?

Accepted Answer

A)   wages
B)   income
C)   capital
D)   rentE) All of the above
F) A) and B)

Question 16

The circular-flow diagram is an example of

Accepted Answer

A)   a laboratory experiment.
B)   an economic model.
C)   a mathematical model.
D)   All of the above are correct.E) B) and D)
F) A) and D)

Question 17

In the circular-flow diagram, firms own the factors of production and use them to produce goods and services.

Accepted Answer

A) True 
 B)False

Question 18

Figure 2-18
Relationship between Price and Restaurant Meals 
-Refer to Figure 2-18. In the ordered pair 8, 24)

Accepted Answer

A)   the x-coordinate is 8 and the y-coordinate is 24.
B)   the x-coordinate is 24 and the y-coordinate is 8.
C)   the numbers tell the location of the origin.
D)   the 8 represents the price and the 24 represents the number of restaurant meals.E) B) and D)
F) All of the above

Question 19

Economists at the Department of Justice

Accepted Answer

A)   track the behavior of the nation's money supply.
B)   advise Congress on economic matters.
C)   help enforce the nation's antitrust laws.
D)   prepare the federal budget.E) A) and D)
F) All of the above

Question 20

In the circular-flow diagram, households and firms are the decision makers.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist

A production possibilities frontier will be bowed outward if some of the economy's resources are better suited to producing one good than another.

Correct AnswerverifiedShow Answer

Figure 2-5 -Refer to Figure 2-5. Inefficient production is represented by which points) ?

Correct AnswerverifiedShow Answer

Figure 2-18 Relationship between Price and Restaurant Meals -Refer to Figure 2-18. In the ordered pair 8, 24)

Correct AnswerverifiedShow Answer

The production possibilities frontier is a graph that shows the various combinations of output that an economy can possibly produce given the available factors of production and

Correct AnswerverifiedShow Answer

In the circular-flow diagram, firms own the factors of production and use them to produce goods and services.

Correct AnswerverifiedShow Answer

Figure 2-4 -Refer to Figure 2-4. Unemployment could cause this economy to produce at which points) ?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 2-2 -Refer to Figure 2-2. Boxes A and B of this circular-flow diagram represent

Correct AnswerverifiedShow Answer

The outer loop of the circular-flow diagram represents the flows of dollars in the economy. Which of the following does not appear on the outer loop?

Correct AnswerverifiedShow Answer

The circular-flow diagram is an example of

Correct AnswerverifiedShow Answer

Economists at the Department of Justice

Correct AnswerverifiedShow Answer

In the circular-flow diagram, households and firms are the decision makers.

Correct AnswerverifiedShow Answer

Economists acting as scientists make positive statements, while economists acting as policy advisers make normative statements.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 2-23 -Refer to Figure 2-23. Given the technology available for manufacturing doghouses and dishwashers, this economy does not have enough of the factors of production to support the level of output represented by point C.

Correct AnswerverifiedShow Answer

Table 2-6 -Refer to Table 2-6. Consider the production possibilities table for an economy that produces only mobile phones and pizzas. What is the opportunity cost of increasing production of pizzas from 4,000 to 6,000?

Correct AnswerverifiedShow Answer

While the production possibilities frontier is a useful model, it cannot be used to illustrate economic growth.

Correct AnswerverifiedShow Answer

In the markets for goods and services in the circular-flow diagram,

Correct AnswerverifiedShow Answer

Economists speaking like scientists make

Correct AnswerverifiedShow Answer

The decision of which assumptions to make is

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified