Question 1

When two variables have a negative correlation,

Accepted Answer

A)  they tend to move in opposite directions.
B)  they tend to move in the same direction.
C)  one variable will move while the other remains constant.
D)  the variables' values are never positive.E) A) and B)
F) B) and C)

Question 2

On a bowed production possibilities frontier, as you move down along the curve

Accepted Answer

A)  more of one good must be given up to receive one unit of the other good.
B)  the available production technology does not change.
C)  the opportunity cost increases.
D)  All of the above are correct.E) A) and B)
F) A) and C)

Question 3

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

Question 4

Since 1946, the president of the United States has received guidance from the Council of Economic Advisers.

Accepted Answer

A) True 
 B)False

Question 5

In the circular-flow diagram, the two types of markets in which households and firms interact are the markets for goods and services and the markets for factors of production.

Accepted Answer

A) True 
 B)False

Question 6

An economic outcome is said to be efficient if the economy is

Accepted Answer

A)  using all of the scarce resources it has available.
B)  conserving on resources, rather than using all available resources.
C)  getting all it can get from the scarce resources it has available.
D)  able to produce more than what is currently being produced without additional resources.E) A) and C)
F) A) and B)

Question 7

Table 2-5
   Cooki=s (in dazens)   Caffe (inguund)  10000800350600650400800200100001150\begin{array} { | c | c | } \hline 	ext { Cooki=s (in dazens)  } & 	ext { Caffe (inguund)  } \\hline 1000 & 0 \\hline 800 & 350 \\hline 600 & 650 \\hline 400 & 800 \\hline 200 & 1000 \\hline 0 & 1150 \\hline\end{array} Cooki=s (in dazens)  10008006004002000​ Caffe (inguund)  035065080010001150​​ 
-Refer to Table 2-5. Table 2-5 shows one set of production possibilities. What is the opportunity cost of an increase in the production of coffee from 350 pounds to 650 pounds?

Accepted Answer

A)  400 dozen cookies
B)  300 dozen cookies
C)  200 dozen cookies
D)  200 pounds of coffee E) C) and D)
F) B) and D)

Question 8

An ordered pair is

Accepted Answer

A)  the process of checking calculations twice before placing them on a graph.
B)  two numbers that can be represented by a single point on a graph.
C)  two numbers that are represented by two points on a graph.
D)  two points on a graph that are of equal distance from the origin.E) A) and B)
F) A) and C)

Question 9

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

Question 10

When economists make

Accepted Answer

A)  positive statements, they are speaking not as scientists but as policy advisers.
B)  positive statements, they are speaking not as scientists but as forecasters.
C)  normative statements, they are speaking not as scientists but as policy advisers.
D)  normative statements, they are speaking not as policy advisers but as model-builders.E) B) and D)
F) A) and B)

Question 11

Different values are not a reason for disagreement among economists.

Accepted Answer

A) True 
 B)False

Question 12

Figure 2-2 
-Refer to Figure 2-2. If households are sellers in the markets represented by Box D of this circular-flow diagram, then

Accepted Answer

A)  Box D must represent the markets for factors of production.
B)  Box C must represent the markets for goods and services.
C)  firms are buyers in the markets represented by Box D.
D)  All of the above are correct.E) All of the above
F) C) and D)

Question 13

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

Accepted Answer

A)  households and firms are both buyers.
B)  households and firms are both sellers.
C)  households are buyers and firms are sellers.
D)  households are sellers and firms are buyers.E) B) and C)
F) C) and D)

Question 14

Figure 2-4 
-Refer to Figure 2-4. Suppose this economy is producing at point W. Which of the following statements would best explain this situation?

Accepted Answer

A)  The economy lacks the resources to produce at a more desirable point.
B)  The economy's available technology prevents it from producing at a more desirable point.
C)  There is widespread unemployment in the economy.
D)  Any of the above statements would be a legitimate explanation for this situation.E) B) and D)
F) A) and B)

Question 15

Figure 2-8
 
-Refer to Figure 2-8, Panel (a) . The opportunity cost of one cup of coffee is highest when the economy produces

Accepted Answer

A)  0 cups of coffee.
B)  2 cups of coffee.
C)  4 cups of coffee.
D)  6 cups of coffee.E) B) and C)
F) A) and B)

Question 16

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

Accepted Answer

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

Question 17

Economists devise theories, collect data, and then analyze these data in an attempt to verify or refute their theories.

Accepted Answer

A) True 
 B)False

Question 18

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 C)
F) All of the above

Question 19

Points inside the production possibilities frontier represent feasible levels of production.

Accepted Answer

A) True 
 B)False

Question 20

According to economist John Maynard Keynes, a great economist must also be a(n)

Accepted Answer

A)  mathematician.
B)  historian.
C)  philosopher.
D)  All of the above are correct.E) All of the above
F) A) and B)

Exam 2: Thinking Like an Economist

Different values are not a reason for disagreement among economists.

Correct Answer
verified

Figure 2-4 -Refer to Figure 2-4. Suppose this economy is producing at point W. Which of the following statements would best explain this situation?

Correct Answer
verified

In the simple circular-flow diagram, households

Correct Answer
verified

Points inside the production possibilities frontier represent feasible levels of production.

Correct Answer
verified

Figure 2-8 -Refer to Figure 2-8, Panel (a) . The opportunity cost of one cup of coffee is highest when the economy produces

Correct Answer
verified

According to economist John Maynard Keynes, a great economist must also be a(n)

Correct Answer
verified

When two variables have a negative correlation,

Correct Answer
verified

An ordered pair is

Correct Answer
verified

Economists devise theories, collect data, and then analyze these data in an attempt to verify or refute their theories.

Correct Answer
verified

Correct Answer
verified

Economists speaking like scientists make

Correct Answer
verified

An economic outcome is said to be efficient if the economy is

Correct Answer
verified

Since 1946, the president of the United States has received guidance from the Council of Economic Advisers.

Correct Answer
verified

In the circular-flow diagram, the two types of markets in which households and firms interact are the markets for goods and services and the markets for factors of production.

Correct Answer
verified

Figure 2-2 -Refer to Figure 2-2. If households are sellers in the markets represented by Box D of this circular-flow diagram, then

Correct Answer
verified

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

Correct Answer
verified

When economists make

Correct Answer
verified

The Council of Economic Advisers

Correct Answer
verified

On a bowed production possibilities frontier, as you move down along the curve

Correct Answer
verified

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

Correct Answer
verified

Exam 2: Thinking Like an Economist

Different values are not a reason for disagreement among economists.

Correct AnswerverifiedShow Answer

Figure 2-4 -Refer to Figure 2-4. Suppose this economy is producing at point W. Which of the following statements would best explain this situation?

Correct AnswerverifiedShow Answer

In the simple circular-flow diagram, households

Correct AnswerverifiedShow Answer

Points inside the production possibilities frontier represent feasible levels of production.

Correct AnswerverifiedShow Answer

Figure 2-8 -Refer to Figure 2-8, Panel (a) . The opportunity cost of one cup of coffee is highest when the economy produces

Correct AnswerverifiedShow Answer

According to economist John Maynard Keynes, a great economist must also be a(n)

Correct AnswerverifiedShow Answer

When two variables have a negative correlation,

Correct AnswerverifiedShow Answer

An ordered pair is

Correct AnswerverifiedShow Answer

Economists devise theories, collect data, and then analyze these data in an attempt to verify or refute their theories.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Economists speaking like scientists make

Correct AnswerverifiedShow Answer

An economic outcome is said to be efficient if the economy is

Correct AnswerverifiedShow Answer

Since 1946, the president of the United States has received guidance from the Council of Economic Advisers.

Correct AnswerverifiedShow Answer

In the circular-flow diagram, the two types of markets in which households and firms interact are the markets for goods and services and the markets for factors of production.

Correct AnswerverifiedShow Answer

Figure 2-2 -Refer to Figure 2-2. If households are sellers in the markets represented by Box D of this circular-flow diagram, then

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

When economists make

Correct AnswerverifiedShow Answer

The Council of Economic Advisers

Correct AnswerverifiedShow Answer

On a bowed production possibilities frontier, as you move down along the curve

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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