Exam 2: Thinking Like an Economist

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

When two variables have a positive correlation,

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

Economists who are primarily responsible for advising Congress on economic matters work in which agency?

Economic growth causes a production possibilities frontier to shift outward.

With respect to how economists study the economy, which of the following statements is most accurate?

Which type of statement - positive or negative - can be evaluated by analyzing data alone?

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

President Truman once said he wanted to find a one-armed economist because when he asked his economists for advice, they always answered, "On the one hand, ... On the other hand, ..." Truman's observation that economists' advice is not always straightforward

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

When economists disagree about whether the government should tax a household's income or its consumption, they are expressing a difference in

The two loops in the circular-flow diagram represent

Figure 2-16​ -Refer to Figure 2-16. The opportunity cost of obtaining 30 additional widgets by moving from point A to point C is approximately

Figure 2-16​ -Refer to Figure 2-16. If this economy devotes all of its resources to the production of gadgets, then it will produce

Figure 2-19 In the following graph the x-axis shows the number of times a commuter rail train stops at a station per hour and the y-axis shows the number of commuter rail passengers per hour. Commuter Rail Passengers by Frequency of Service -Refer to Figure 2-19. A policymaker observes this graph and concludes that increasing the frequency of commuter rail service is a certain way to get more commuters to choose the commuter rail instead of driving their own cars. You warn the policymaker about making a reverse causality mistake with which of the following statements?

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

Who would be more likely to study the effects of government spending on the unemployment rate, a macroeconomist or a microeconomist?

Which of the following is a positive, as opposed to a normative, statement?

Suppose an economy produces two goods, food and machines. This economy always operates on its production possibilities frontier. Last year, it produced 1000 units of food and 47 machines. This year it experienced a technological advance in its machine-making industry. As a result, this year the society wants to produce 1050 units of food and 47 machines. Which of the following statements is correct?

Figure 2-14 -Refer to Figure 2-14. If this economy uses all its resources in the dishwasher industry, it produces 35 dishwashers and no doghouses.