Question 1

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) C) and D)

Question 2

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 B)
F) A) and C)

Question 3

Figure 2-14 
-Refer to Figure 2-14. The opportunity cost of moving from point A to point D is 10 dishwashers.

Accepted Answer

A) True 
 B)False

Question 4

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 5

Figure 2-6 
-Refer to Figure 2-6. A movement from point H to point K could be caused by

Accepted Answer

A)  unemployment.
B)  a decrease in society's preference for pillows.
C)  fewer resources available for production of pillows.
D)  All of the above are correct.E) B) and D)
F) B) and C)

Question 6

Figure 2-14 
-Refer to Figure 2-14. This economy fully employs its resources when it produces 35 dishwashers and zero doghouses.

Accepted Answer

A) True 
 B)False

Question 7

In the markets for the factors of production in the circular-flow diagram,

Accepted Answer

A)  households are sellers and firms are buyers.
B)  households are buyers and firms are sellers.
C)  households and firms are both buyers.
D)  households and firms are both sellers.E) A) and B)
F) None of the above

Question 8

Which of the following statements applies to economics, as well as to other sciences such as physics?

Accepted Answer

A)  Experiments are considered valid only when they are conducted in a laboratory.
B)  Good theories do not need to be tested.
C)  Real-world observations often lead to theories.
D)  Economics, as well as other sciences, is concerned primarily with abstract concepts.E) A) and C)
F) A) and B)

Question 9

A demand curve displaying the relationship between the price of cars and the quantity demanded of cars should have a slope that is

Accepted Answer

A)  less than 0.
B)  between zero and 1.
C)  between one and infinity.
D)  undefined.E) B) and C)
F) A) and D)

Question 10

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) None of the above
F) C) and D)

Question 11

Economists use one standard set of assumptions to answer all economic questions.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following statements best captures the relationship between microeconomics and macroeconomics?

Accepted Answer

A)  For the most part, microeconomists are unconcerned with macroeconomics, and macroeconomists are unconcerned with microeconomics.
B)  Microeconomists study markets for small products, whereas macroeconomists study markets for large products.
C)  Microeconomics and macroeconomics are distinct from one another, yet they are closely related.
D)  Microeconomics is oriented toward policy studies, whereas macroeconomics is oriented toward theoretical studies.E) B) and D)
F) B) and C)

Question 13

Economists use some familiar terms in specialized ways

Accepted Answer

A)  to make the subject sound more complex than it is.
B)  because every respectable field of study has its own language.
C)  to provide a new and useful way of thinking about the world.
D)  because it was too difficult to come up with new terms.E) None of the above
F) A) and B)

Question 14

A production possibilities frontier can shift outward if

Accepted Answer

A)  government increases the amount of money in the economy.
B)  there is a technological improvement.
C)  resources are shifted from the production of one good to the production of the other good.
D)  the economy abandons inefficient production methods in favor of efficient production methods.E) All of the above
F) B) and C)

Question 15

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

Question 16

Economists make use of assumptions, some of which are unrealistic, for the purpose of

Accepted Answer

A)  teaching economics to people who have never before studied economics.
B)  advancing their political agendas.
C)  developing models when the scientific method cannot be used.
D)  focusing their thinking.E) All of the above
F) A) and C)

Question 17

Good assumptions simplify a problem without substantially affecting the answer.

Accepted Answer

A) True 
 B)False

Question 18

For economists, conducting experiments is often difficult and sometimes impossible.

Accepted Answer

A) True 
 B)False

Question 19

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 20

Figure 2-14 
-Refer to Figure 2-14. When this economy produces 30 doghouses and 25 dishwashers there is full employment.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist

Economists speaking like scientists make

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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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The decision of which assumptions to make is

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A demand curve displaying the relationship between the price of cars and the quantity demanded of cars should have a slope that is

Correct AnswerverifiedShow Answer

Figure 2-14 -Refer to Figure 2-14. When this economy produces 30 doghouses and 25 dishwashers there is full employment.

Correct AnswerverifiedShow Answer

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

Figure 2-6 -Refer to Figure 2-6. A movement from point H to point K could be caused by

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Economists use one standard set of assumptions to answer all economic questions.

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Figure 2-17 -Refer to Figure 2-17. The slope of the curve between points A and B is

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Which of the following statements best captures the relationship between microeconomics and macroeconomics?

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Figure 2-14 -Refer to Figure 2-14. The opportunity cost of moving from point A to point D is 10 dishwashers.

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Good assumptions simplify a problem without substantially affecting the answer.

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Which of the following statements applies to economics, as well as to other sciences such as physics?

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For economists, conducting experiments is often difficult and sometimes impossible.

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Economists make use of assumptions, some of which are unrealistic, for the purpose of

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Figure 2-14 -Refer to Figure 2-14. This economy fully employs its resources when it produces 35 dishwashers and zero doghouses.

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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

A production possibilities frontier can shift outward if

Correct AnswerverifiedShow Answer

Economists use some familiar terms in specialized ways

Correct AnswerverifiedShow Answer

In the markets for the factors of production in the circular-flow diagram,

Correct AnswerverifiedShow Answer

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