Exam 2: Economic Models: Trade-Offs and Trade 25

Use the following to answer questions: Figure: Consumer and Capital Goods -(Figure: Consumer and Capital Goods) Look at the figure Consumer and Capital Goods. If the economy is operating at point Y and its relevant production possibility frontier is curve 1:

The scaling of the axes of a time-series graph:

If a production possibility frontier is a straight line, it tells us that the opportunity cost of producing one more unit of good X:

A production possibility frontier that is a straight line sloping down from left to right suggests that:

In a single day, Sarah can produce 10 hamburgers, and Abe can produce 5 hamburgers. Therefore, _____ has a(n) _____ advantage in making hamburgers.

On a graph representing two variables:

Use the following to answer questions: Figure: Consumption of Pizza and Tacos -(Figure: Consumption of Pizza and Tacos) Look at the figure Consumption of Pizza and Tacos. The figure shows the number of tacos and pizza slices Matt can eat in a day. The relation is nonlinear, and there is a negative relation between the number of tacos and pizza slices that Matt can eat in a day.

The ______ of a curve shows the point at which the curve intersects an axis.

Use the following to answer questions: Figure: Guns and Butter -(Figure: Guns and Butter) Look at the figure Guns and Butter. The combination of guns and butter at point H:

Use the following to answer question: -(Table: Hours Studied and Quiz Score) Look at the table Hours Studied and Quiz Score. The table shows data for students in an economics class. If we were to graph these data and draw a line through the points, we would choose ______ to be the independent variable; the vertical intercept of our line would be ______; and the slope of our line would be ______.

The ratio of the change in the variable on the vertical axis to the change in the variable on the horizontal axis, measured between two points on the curve, is the:

Efficient production occurs when the economy is:

You are reading an editorial in your local newspaper. The editorial says: "The United States had a trade deficit of $18.4 billion in February 2008. This is a clear indication to our leaders that we must renegotiate our trade agreements with China to make them fairer for the American worker." What part of this editorial is positive and what part is normative?

Leaders of a small town are tired of looking at a vacant and dilapidated warehouse that sits on a prime piece of real estate. The town finds an investor who purchases the warehouse and promises to renovate the old building and build condominiums in the old building. Is this economic growth?

Use the following to answer questions: Figure: Guns and Butter -(Figure: Guns and Butter) Look at the figure Guns and Butter. This production possibility frontier is:

In the circular-flow diagram, an individual or a group of people (usually a family) who share their income is a(n):

Use the following to answer questions: Figure: Sugar and Freight Trains -(Figure: Sugar and Freight Trains) Look at the figure Sugar and Freight Trains. Suppose the economy is operating at point B. The opportunity cost of producing the third freight train would be _____ tons of sugar.

Economists disagree more over normative economics than positive economics.

Which of the following is a normative statement?

In the circular-flow diagram firms buy _____ in the _____ market.