Question 1

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 C)
F) C) and D)

Question 2

Economists view normative statements as

Accepted Answer

A)  prescriptive, making a claim about how the world ought to be.
B)  descriptive, making a claim about how the world is.
C)  statements about the normal condition of the world.
D)  pessimistic, putting the worst possible interpretation on things.E) B) and D)
F) All of the above

Question 3

Almost all economists agree that tariffs and import quotas

Accepted Answer

A)  reduces general economic welfare.
B)  increases general economic welfare.
C)  have no effect on general economic welfare.
D)  stimulate a less than fully employed economy.E) All of the above
F) A) and B)

Question 4

A technological advance in the production of the first good increases the opportunity cost of the first good in terms of the second good.

Accepted Answer

A) True 
 B)False

Question 5

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

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. Describe the shape of the production possibilities frontier.

Accepted Answer

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

Question 7

Figure 2-4 
-Refer to Figure 2-4. This economy has the ability to produce at which point(s) ?

Accepted Answer

A)  Q, R, T, U
B)  R, T, U
C)  R, U
D)  TE) A) and C)
F) C) and D)

Question 8

Policies such as rent control and trade barriers persist

Accepted Answer

A)  because economists are about evenly divided as to the merits of those policies.
B)  because almost all economists agree that those policies have no discernible economic effects.
C)  because almost all economists agree that those policies are desirable.
D)  despite the fact that almost all economists agree that those policies are undesirable.E) A) and D)
F) C) and D)

Question 9

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 10

The Federal Reserve

Accepted Answer

A)  designs tax policy.
B)  enforces the nation's antitrust laws.
C)  sets the nation's monetary policy.
D)  analyzes data on workers.E) A) and B)
F) None of the above

Question 11

In the circular-flow diagram,

Accepted Answer

A)  taxes flow from households to firms, and transfer payments flow from firms to households.
B)  income payments flow from firms to households, and sales revenue flows from households to firms.
C)  resources flow from firms to households, and goods and services flow from households to firms.
D)  inputs and outputs flow in the same direction as the flow of dollars, from firms to households.E) B) and C)
F) A) and D)

Question 12

The Economic Report of the President

Accepted Answer

A)  discusses recent developments in the economy and presents analysis of current policy issues.
B)  is written by the Council of Economic Advisers.
C)  is the responsibility of the economists at the Office of Management and Budget.
D)  Both a and b are correct.E) B) and D)
F) A) and C)

Question 13

Figure 2-5 
-Refer to Figure 2-5. The opportunity cost of this economy moving from point A to point B is

Accepted Answer

A)  20 dryers.
B)  20 washers.
C)  20 dryers and 20 washers.
D)  60 dryers.E) All of the above
F) A) and B)

Question 14

Figure 2-18
Relationship between Price and Restaurant Meals 
-Refer to Figure 2-18. A movement from point A to point B is called

Accepted Answer

A)  a shift in demand.
B)  a movement along the demand curve.
C)  a shift in supply.
D)  a movement along the supply curve.E) None of the above
F) A) and D)

Question 15

A pie chart is a way to display information regarding two variables.

Accepted Answer

A) True 
 B)False

Question 16

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

Accepted Answer

A)  Box C must represent the markets for the factors of production.
B)  Box D must represent the markets for goods and services.
C)  firms are sellers in the markets represented by Box C.
D)  All of the above are correct.E) None of the above
F) C) and D)

Question 17

The argument that purchases of minivans cause large families is an example of

Accepted Answer

A)  omitted variables.
B)  normative statements.
C)  reverse causality.
D)  bias.E) A) and D)
F) A) and C)

Question 18

Figure 2-3 
-Refer to Figure 2-3. What does the arrow going from oval B to rectangle 2 represent in the figure?

Accepted Answer

The answer of Figure 2-3 
-Refer to Figure 2-3. What...

Question 19

When economists are trying to explain the world, they are scientists. When they are trying to improve it, they are

Accepted Answer

The answer of When economists are trying to explain the...

Question 20

Figure 2-1 
-Refer to Figure 2-1. Which arrow represents the flow of goods and services?

Accepted Answer

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

Exam 2: Thinking Like an Economist

Figure 2-3 -Refer to Figure 2-3. What does the arrow going from oval B to rectangle 2 represent in the figure?

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Almost all economists agree that tariffs and import quotas

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The argument that purchases of minivans cause large families is an example of

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Figure 2-4 -Refer to Figure 2-4. This economy has the ability to produce at which point(s) ?

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The Federal Reserve

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A demand curve shows the relationship

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Figure 2-1 -Refer to Figure 2-1. Which arrow represents the flow of goods and services?

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Policies such as rent control and trade barriers persist

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Figure 2-18 Relationship between Price and Restaurant Meals -Refer to Figure 2-18. A movement from point A to point B is called

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Economists view normative statements as

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Figure 2-5 -Refer to Figure 2-5. The opportunity cost of this economy moving from point A to point B is

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The Economic Report of the President

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

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A technological advance in the production of the first good increases the opportunity cost of the first good in terms of the second good.

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. Describe the shape of the production possibilities frontier.

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

Correct AnswerverifiedShow Answer

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.

Correct AnswerverifiedShow Answer

A pie chart is a way to display information regarding two variables.

Correct AnswerverifiedShow Answer

In the circular-flow diagram,

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When economists are trying to explain the world, they are scientists. When they are trying to improve it, they are

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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