Question 1

Which of the following statements is (are)  correct?

Accepted Answer

A)  Relative to some other scientists, economists find it more difficult to conduct experiments.
B)  Theory and observation are important in economics as well as in other sciences.
C)  To obtain data, economists often rely upon the natural experiments offered by history.
D)  All of the above are correct.E) B) and C)
F) A) and D)

Question 2

In the circular-flow diagram, which of the following items flows from firms to households through the markets for goods and services?

Accepted Answer

A)  goods and services
B)  dollars paid to land, labor, and capital
C)  dollars spent on goods and services
D)  wages, rent, and profitE) A) and B)
F) A) and C)

Question 3

Economists try to address their subject with a scientist's objectivity.

Accepted Answer

A) True 
 B)False

Question 4

The field of economics is traditionally divided into two broad subfields,

Accepted Answer

A)  national economics and international economics.
B)  consumer economics and producer economics.
C)  private sector economics and public sector economics.
D)  microeconomics and macroeconomics.E) A) and D)
F) A) and C)

Question 5

Production possibilities frontiers can be used to illustrate scarcity, trade-offs, opportunity cost, efficiency, unemployment, technological advances, and economic growth.

Accepted Answer

A) True 
 B)False

Question 6

Economists believe that production possibilities frontiers

Accepted Answer

A)  never have a bowed shape.
B)  rarely have a bowed shape.
C)  often have a bowed shape.
D)  always have a bowed shape.E) C) and D)
F) A) and B)

Question 7

"Other things equal, an increase in supply causes a decrease in price" is a normative statement, not a positive statement.

Accepted Answer

A) True 
 B)False

Question 8

When a production possibilities frontier is bowed outward, the opportunity cost of one good in terms of the other depends on how much of each good is being produced.

Accepted Answer

A) True 
 B)False

Question 9

Studying which of the following is helpful in learning to think like an economist​?

Accepted Answer

A)  ​theory.
B)  ​case studies.
C)  examples of economics in the news.
D)  ​all of the above.E) B) and D)
F) B) and C)

Question 10

The art in scientific thinking -- whether in chemistry, economics, or biology -- is

Accepted Answer

A)  the design and implementation of laboratory experiments.
B)  knowing when to stop collecting data and when to start analyzing the data.
C)  deciding which assumptions to make.
D)  being able to mathematically model natural phenomena.E) A) and C)
F) C) and D)

Question 11

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

Question 12

Figure 2-6 
-Refer to Figure 2-6. The opportunity cost of this economy moving from point I to point H is

Accepted Answer

A)  120 pillows.
B)  120 blankets.
C)  120 blankets and 120 pillows.
D)  200 blankets.E) B) and C)
F) A) and D)

Question 13

Figure 2-5 
-Refer to Figure 2-5. If this economy devotes all of its resources to the production of dryers, then it will produce

Accepted Answer

A)  0 dryers and 100 washers.
B)  60 dryers and 50 washers.
C)  80 dryers and 0 washers.
D)  80 dryers and 50 washers.E) None of the above
F) A) and C)

Question 14

When a production possibilities frontier is bowed outward, the opportunity cost of producing an additional unit of a good

Accepted Answer

A)  increases as more of the good is produced.
B)  decreases as more of the good is produced.
C)  does not change as more of the good is produced.
D)  may increase, decrease, or not change as more of the good is produced.E) A) and B)
F) None of the above

Question 15

Efficiency is illustrated by

Accepted Answer

A)  both the production possibilities frontier and the circular-flow diagram.
B)  neither the production possibilities frontier nor the circular-flow diagram.
C)  the production possibilities frontier only.
D)  the circular-flow diagram only.E) B) and C)
F) A) and D)

Question 16

The Congressional Budget Office, which is staffed by economists, provides Congress with independent evaluations of policy proposals.

Accepted Answer

A) True 
 B)False

Question 17

Figure 2-21 
-Refer to Figure 2-21. Your friend John created the graph above to illustrate that snowstorms are caused by more snowblowers being sold. You inform him that his interpretation is incorrect due to

Accepted Answer

A)  omitted variable bias.
B)  reverse causality.
C)  slope mismatch.
D)  shifting versus moving along a curve.E) B) and D)
F) None of the above

Question 18

Table 2-5 
-Refer to Table 2-5. Table 2-5 shows one set of production possibilities. Based on the values in the table, the production possibilities frontier is

Accepted Answer

A)  bowed outward indicating increasing opportunity costs.
B)  bowed outward indicating decreasing opportunity costs.
C)  a straight line indicating constant opportunity costs.
D)  bowed inward indicating increasing opportunity costs.E) A) and D)
F) None of the above

Question 19

The slope of a steep upward-sloping line will be a

Accepted Answer

A)  small positive number.
B)  large positive number.
C)  small negative number.
D)  large negative number.E) C) and D)
F) A) and B)

Question 20

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

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist

When a production possibilities frontier is bowed outward, the opportunity cost of producing an additional unit of a good

Correct AnswerverifiedShow Answer

The field of economics is traditionally divided into two broad subfields,

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When a production possibilities frontier is bowed outward, the opportunity cost of one good in terms of the other depends on how much of each good is being produced.

Correct AnswerverifiedShow Answer

Production possibilities frontiers can be used to illustrate scarcity, trade-offs, opportunity cost, efficiency, unemployment, technological advances, and economic growth.

Correct AnswerverifiedShow Answer

Figure 2-6 -Refer to Figure 2-6. The opportunity cost of this economy moving from point I to point H is

Correct AnswerverifiedShow Answer

The Congressional Budget Office, which is staffed by economists, provides Congress with independent evaluations of policy proposals.

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) ?

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In the circular-flow diagram, which of the following items flows from firms to households through the markets for goods and services?

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Table 2-5 -Refer to Table 2-5. Table 2-5 shows one set of production possibilities. Based on the values in the table, the production possibilities frontier is

Correct AnswerverifiedShow Answer

"Other things equal, an increase in supply causes a decrease in price" is a normative statement, not a positive statement.

Correct AnswerverifiedShow Answer

Figure 2-21 -Refer to Figure 2-21. Your friend John created the graph above to illustrate that snowstorms are caused by more snowblowers being sold. You inform him that his interpretation is incorrect due to

Correct AnswerverifiedShow Answer

Economists believe that production possibilities frontiers

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The slope of a steep upward-sloping line will be a

Correct AnswerverifiedShow Answer

Studying which of the following is helpful in learning to think like an economist​?

Correct AnswerverifiedShow Answer

The art in scientific thinking -- whether in chemistry, economics, or biology -- is

Correct AnswerverifiedShow Answer

Efficiency is illustrated by

Correct AnswerverifiedShow Answer

Which of the following statements is (are) correct?

Correct AnswerverifiedShow Answer

Economists try to address their subject with a scientist's objectivity.

Correct AnswerverifiedShow Answer

Figure 2-5 -Refer to Figure 2-5. If this economy devotes all of its resources to the production of dryers, then it will produce

Correct AnswerverifiedShow Answer

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Studying which of the following is helpful in learning to think like an economist?

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