Question 1

Figure 2-14  
-Refer to Figure 2-14. Points A, B, and D represent efficient outcomes for this economy.

Accepted Answer

A) True 
 B)False

Question 2

If Martina's income increases and, as a result, she chooses to buy more lattés per month at each price, then her demand curve will

Accepted Answer

A) shift to the right. 
B) shift to the left. 
C) not shift; instead, Martina will move along her demand curve downward and to the right. 
D) not shift; instead, Martina will move along her demand curve upward and to the left. 
A) shift to the right. 
B) shift to the left. 
C) not shift; instead, Martina will move along her demand curve downward and to the right. 
D) not shift; instead, Martina will move along her demand curve upward and to the left.

Question 3

Economists work both inside and outside the administrative branch of the U.S. government.

Accepted Answer

A) True 
 B)False

Question 4

Figure 2-13  
-Refer to Figure 2-13. Which points are not currently attainable but could become achievable for this economy if there is an improvement in technology?

Accepted Answer

A) I, L 
B) G, H 
C) J, K 
D) F, G 
A) I, L 
B) G, H 
C) J, K 
D) F, G

Question 5

Figure 2-8  
-Refer to Figure 2-8. Point K represents an outcome in which

Accepted Answer

A) production is inefficient. 
B) some of the economy's resources are unemployed. 
C) the economy is using all of its resources to produce hammers. 
D) the economy is using all of its nails to produce hammers. 
A) production is inefficient. 
B) some of the economy's resources are unemployed. 
C) the economy is using all of its resources to produce hammers. 
D) the economy is using all of its nails to produce hammers.

Question 6

In the simple circular-flow diagram,

Accepted Answer

A) households own the factors of production. 
B) households buy all the goods and services that firms produce. 
C) land, labor, and capital flow from households to firms. 
D) All of the above are correct. 
A) households own the factors of production. 
B) households buy all the goods and services that firms produce. 
C) land, labor, and capital flow from households to firms. 
D) All of the above are correct.

Question 7

The scientific method is the dispassionate development and testing of theories about how the world works.

Accepted Answer

A) True 
 B)False

Question 8

Figure 2-9
Panel (a)
Panel (b)    
-Refer to Figure 2-9, Panel (a). Production is

Accepted Answer

A) possible at points J, K, L, and M, but efficient only at points J, L, and M. 
B) possible at points J, K, L, and M, but efficient only at point K. 
C) possible at points J, L, M, and N, but efficient only at points J, L, and M. 
D) possible at points J, L, M, and N, but efficient only at point N. 
A) possible at points J, K, L, and M, but efficient only at points J, L, and M. 
B) possible at points J, K, L, and M, but efficient only at point K. 
C) possible at points J, L, M, and N, but efficient only at points J, L, and M. 
D) possible at points J, L, M, and N, but efficient only at point N.

Question 9

In surveys of professional economists, fourteen propositions were endorsed by an overwhelming majority of respondents.

Accepted Answer

A) True 
 B)False

Question 10

Economists acting as scientists make positive statements, while economists acting as policy advisers make normative statements.

Accepted Answer

A) True 
 B)False

Question 11

Figure 2-20
Relationship Between Years of Education and Annual Income  
-Refer to Figure 2-20. According to the graph, the correlation between years of education and annual income is

Accepted Answer

A) positive 
B) negative 
C) inverse 
D) normative 
A) positive 
B) negative 
C) inverse 
D) normative

Question 12

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. 
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.

Question 13

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

Accepted Answer

The answer of Which type of statement - positive or...

Question 14

Unemployment would cause an economy to

Accepted Answer

A) produce inside its production possibilities frontier. 
B) produce on its production possibilities frontier. 
C) produce outside its production possibilities frontier. 
D) experience an inward shift of its production possibilities frontier. 
A) produce inside its production possibilities frontier. 
B) produce on its production possibilities frontier. 
C) produce outside its production possibilities frontier. 
D) experience an inward shift of its production possibilities frontier.

Question 15

In building economic models, economists often omit

Accepted Answer

A) assumptions. 
B) theories. 
C) details. 
D) equations. 
A) assumptions. 
B) theories. 
C) details. 
D) equations.

Question 16

When economists are trying to explain the world, they are scientists, and when they are trying to help improve the world, they are policy advisers.

Accepted Answer

A) True 
 B)False

Question 17

In the ordered pair (10,30), 10 is the horizontal location of the point and 30 is the vertical location of the point.

Accepted Answer

A) True 
 B)False

Question 18

Figure 2-15  
-Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of each car is

Accepted Answer

A) the slope of the production possibilities frontier. 
B) 3/2 sofas. 
C) 2/3 of a sofa. 
D) Both a and b are correct. 
A) the slope of the production possibilities frontier. 
B) 3/2 sofas. 
C) 2/3 of a sofa. 
D) Both a and b are correct.

Question 19

When an economist is asked a question like "why is unemployment higher for teenagers than for older workers?" the economist

Accepted Answer

A) is asked to explain the cause of an economic event. 
B) is asked to recommend a policy to improve economic outcomes. 
C) is asked as a policy adviser. 
D) does not have enough information to respond. 
A) is asked to explain the cause of an economic event. 
B) is asked to recommend a policy to improve economic outcomes. 
C) is asked as a policy adviser. 
D) does not have enough information to respond.

Question 20

The slope of a line is equal to

Accepted Answer

A) the change in the value of x divided by the change in the value of y. 
B) the change in the value of y divided by the change in the value of x. 
C) the horizontal distance divided by the vertical distance. 
D) the value of y divided by the value of x. 
A) the change in the value of x divided by the change in the value of y. 
B) the change in the value of y divided by the change in the value of x. 
C) the horizontal distance divided by the vertical distance. 
D) the value of y divided by the value of x.

Exam 2: Thinking Like an Economist

Figure 2-14 -Refer to Figure 2-14. Points A, B, and D represent efficient outcomes for this economy.

If Martina's income increases and, as a result, she chooses to buy more lattés per month at each price, then her demand curve will

Economists work both inside and outside the administrative branch of the U.S. government.

Figure 2-13 -Refer to Figure 2-13. Which points are not currently attainable but could become achievable for this economy if there is an improvement in technology?

Figure 2-8 -Refer to Figure 2-8. Point K represents an outcome in which

In the simple circular-flow diagram,

The scientific method is the dispassionate development and testing of theories about how the world works.

Figure 2-9 Panel (a) Panel (b) -Refer to Figure 2-9, Panel (a). Production is

In surveys of professional economists, fourteen propositions were endorsed by an overwhelming majority of respondents.

Economists acting as scientists make positive statements, while economists acting as policy advisers make normative statements.

Figure 2-20 Relationship Between Years of Education and Annual Income -Refer to Figure 2-20. According to the graph, the correlation between years of education and annual income is

A production possibilities frontier can shift outward if

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

Unemployment would cause an economy to

In building economic models, economists often omit

When economists are trying to explain the world, they are scientists, and when they are trying to help improve the world, they are policy advisers.

In the ordered pair (10,30), 10 is the horizontal location of the point and 30 is the vertical location of the point.

Figure 2-15 -Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of each car is

When an economist is asked a question like "why is unemployment higher for teenagers than for older workers?" the economist

The slope of a line is equal to

Ten Principles of Economics

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Applications: the Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Measuring a Nation S Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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