Question 1

The scientific method is

Accepted Answer

A) the use of modern technology to understand the way the world works. 
B) the use of controlled laboratory experiments to understand the way the world works. 
C) the dispassionate development and testing of theories about how the world works. 
D) the search for evidence to support preconceived theories about how the world works. 
A) the use of modern technology to understand the way the world works. 
B) the use of controlled laboratory experiments to understand the way the world works. 
C) the dispassionate development and testing of theories about how the world works. 
D) the search for evidence to support preconceived theories about how the world works.

Question 2

Figure 2-4  
-Refer to Figure 2-4. Efficient production is represented by which point(s)?

Accepted Answer

A) Q, R, U 
B) R, T, U 
C) R, U 
D) S, T 
A) Q, R, U 
B) R, T, U 
C) R, U 
D) S, T

Question 3

Figure 2-10
Panel (a)
Panel (b)    
-Refer to Figure 2-10, Panel (a) and Panel (b). A shift of the economy's production possibilities frontier from Panel (a) to Panel (b) could be caused by

Accepted Answer

A) unemployment. 
B) an improvement in sofa production technology. 
C) an improvement in tractor production technology. 
D) an improvement in both sofa and tractor production technology. 
A) unemployment. 
B) an improvement in sofa production technology. 
C) an improvement in tractor production technology. 
D) an improvement in both sofa and tractor production technology.

Question 4

Is the following a positive or normative statement? The unemployment rate in Nevada is higher than the unemployment rate in New York.

Accepted Answer

The answer of Is the following a positive or normative...

Question 5

Who would be more likely to study the effects of foreign competition on the accounting industry, a macroeconomist or a microeconomist?

Accepted Answer

The answer of Who would be more likely to study...

Question 6

Economists make assumptions to

Accepted Answer

A) provide issues for political discussion. 
B) make a complex world easier to understand. 
C) make it easier to teach economic concepts and analysis. 
D) create policy alternatives that are incomplete or subject to criticism. 
A) provide issues for political discussion. 
B) make a complex world easier to understand. 
C) make it easier to teach economic concepts and analysis. 
D) create policy alternatives that are incomplete or subject to criticism.

Question 7

Eva wants to create a graph containing the prices of concert tickets and the corresponding quantities of concert tickets demanded by customers. She should use a(n)

Accepted Answer

A) pie chart. 
B) bar graph. 
C) time-series graph 
D) coordinate system. 
A) pie chart. 
B) bar graph. 
C) time-series graph 
D) coordinate system.

Question 8

Instead of conducting laboratory experiments to generate data to test their theories, economists often

Accepted Answer

A) ask winners of the Nobel Prize in Economics to evaluate their theories. 
B) argue that data is impossible to collect in economics. 
C) gather data from historical episodes of economic change. 
D) assume that data would support their theories. 
A) ask winners of the Nobel Prize in Economics to evaluate their theories. 
B) argue that data is impossible to collect in economics. 
C) gather data from historical episodes of economic change. 
D) assume that data would support their theories.

Question 9

When a production possibilities frontier is bowed outward, the opportunity cost of the first good in terms of the second good increases as more of the second good is produced.

Accepted Answer

A) True 
 B)False

Question 10

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

Accepted Answer

A) possible and efficient. 
B) possible but inefficient. 
C) impossible but efficient. 
D) impossible and inefficient. 
A) possible and efficient. 
B) possible but inefficient. 
C) impossible but efficient. 
D) impossible and inefficient.

Question 11

Which of the following is not an assumption of the productions possibilities frontier?

Accepted Answer

A) A country produces only two goods or types of goods. 
B) Technology does not change. 
C) The amount of available resources does not change. 
D) There is a fixed quantity of money. 
A) A country produces only two goods or types of goods. 
B) Technology does not change. 
C) The amount of available resources does not change. 
D) There is a fixed quantity of money.

Question 12

The circular-flow diagram explains, in general terms, how the economy is organized and how participants in the economy interact with one another.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is an example of using the scientific method with a natural experiment?

Accepted Answer

A) measuring how long it takes a marble to fall from a ten story building 
B) comparing plant growth with and without a soil additive 
C) tracking the price of oil when a war in the Middle East interrupts the flow of crude oil 
D) observing the reaction when two chemicals are mixed together 
A) measuring how long it takes a marble to fall from a ten story building 
B) comparing plant growth with and without a soil additive 
C) tracking the price of oil when a war in the Middle East interrupts the flow of crude oil 
D) observing the reaction when two chemicals are mixed together

Question 14

Figure 2-3  
-Refer to Figure 2-3. What do the ovals represent in the figure?

Accepted Answer

Market for Goods and

Question 15

A circular-flow model and production possibilities frontier are similar in that

Accepted Answer

A) neither allows economic analysis to occur. 
B) neither can be represented visually on a graph. 
C) both make use of assumptions. 
D) both make use of complex equations to arrive at solutions. 
A) neither allows economic analysis to occur. 
B) neither can be represented visually on a graph. 
C) both make use of assumptions. 
D) both make use of complex equations to arrive at solutions.

Question 16

In the circular-flow diagram, firms produce

Accepted Answer

A) goods and services using factors of production. 
B) output using inputs. 
C) factors of production using goods and services. 
D) Both (a) and (b) are correct. 
A) goods and services using factors of production. 
B) output using inputs. 
C) factors of production using goods and services. 
D) Both (a) and (b) are correct.

Question 17

Which of the following statements is correct?

Accepted Answer

A) Economists almost always find it easy to conduct experiments in order to test their theories. 
B) Economics is not a true science because economists are not usually allowed to conduct experiments to test their theories. 
C) Economics is a social science rather than a true science because it cannot employ the scientific method. 
D) Economists are usually not able to conduct experiments, so they must rely on natural experiments offered by history. 
A) Economists almost always find it easy to conduct experiments in order to test their theories. 
B) Economics is not a true science because economists are not usually allowed to conduct experiments to test their theories. 
C) Economics is a social science rather than a true science because it cannot employ the scientific method. 
D) Economists are usually not able to conduct experiments, so they must rely on natural experiments offered by history.

Question 18

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. Which of the following conclusions should not be drawn from observing this graph?

Accepted Answer

A) There is a positive correlation between the frequency of service and the number of passengers. 
B) When there are 5 stops per hour, there are approximately 200 passengers. 
C) More stops per hour is associated with more passengers per hour. 
D) No other factors besides the frequency of service affect the number of passengers. 
A) There is a positive correlation between the frequency of service and the number of passengers. 
B) When there are 5 stops per hour, there are approximately 200 passengers. 
C) More stops per hour is associated with more passengers per hour. 
D) No other factors besides the frequency of service affect the number of passengers.

Question 19

In the ordered pair (5, 3), 3 is the

Accepted Answer

A) horizontal location of the point. 
B) the slope. 
C) the x-coordinate. 
D) the y-coordinate. 
A) horizontal location of the point. 
B) the slope. 
C) the x-coordinate. 
D) the y-coordinate.

Question 20

In the circular-flow diagram, firms produce goods and services using the factors of production.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist

The scientific method is

Figure 2-4 -Refer to Figure 2-4. Efficient production is represented by which point(s)?

Figure 2-10 Panel (a) Panel (b) -Refer to Figure 2-10, Panel (a) and Panel (b). A shift of the economy's production possibilities frontier from Panel (a) to Panel (b) could be caused by

Is the following a positive or normative statement? The unemployment rate in Nevada is higher than the unemployment rate in New York.

Who would be more likely to study the effects of foreign competition on the accounting industry, a macroeconomist or a microeconomist?

Economists make assumptions to

Eva wants to create a graph containing the prices of concert tickets and the corresponding quantities of concert tickets demanded by customers. She should use a(n)

Instead of conducting laboratory experiments to generate data to test their theories, economists often

When a production possibilities frontier is bowed outward, the opportunity cost of the first good in terms of the second good increases as more of the second good is produced.

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

Which of the following is not an assumption of the productions possibilities frontier?

The circular-flow diagram explains, in general terms, how the economy is organized and how participants in the economy interact with one another.

Which of the following is an example of using the scientific method with a natural experiment?

Figure 2-3 -Refer to Figure 2-3. What do the ovals represent in the figure?

A circular-flow model and production possibilities frontier are similar in that

In the circular-flow diagram, firms produce

Which of the following statements is correct?

In the ordered pair (5, 3), 3 is the

In the circular-flow diagram, firms produce goods and services using the factors of production.

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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