Exam 2: Thinking Like an Economist

Which of the following is one of the basic reasons why economists often appear to give conflicting advice to policymakers?

The effects of foreign competition on the U.S. textile industry would be studied by a microeconomist rather than a macroeconomist.

Table 2-1 The following table contains some production possibilities for an economy for a given month. -Refer to Table 2-1. If the production possibilities frontier is bowed outward, then "?" could be

Normative statements are

Figure 2-17​ -Refer to Figure 2-17. The opportunity cost of moving from point A to point B is zero.

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

The Council of Economic Advisers

The y-coordinate is the

Economists view positive statements as

In the circular-flow diagram, which of the following is not a factor of production?

When income increases the slope of an individual's demand curve, the demand curve

Figure 2-10 Panel (a) Panel (b) -Refer to Figure 2-10, Panel (a). Production at point Y is

Like biologists and physicists, economists use the dispassionate development and testing of how the world works known as the

Which of the following is not an example of a natural experiment an economist might use to evaluate a theory?

The slope of a horizontal line is infinite, and the slope of a vertical line is zero.

In the circular-flow diagram, firms own the factors of production and use them to produce goods and services.

For economists, substitutes for laboratory experiments often come in the form of

Figure 2-14 Consider the production possibilities curve for a country that can produce sweaters, apples (in bushels), or a combination of the two. -Refer to Figure 2-14. Which point(s) on the graph show unemployment of resources?

Economists use one standard set of assumptions to answer all economic questions.

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