Question 1

Larry Summers,a chief economic adviser to President Obama,stated that as a result of using Keynesian policies in 2008 and 2009,

Accepted Answer

A)  US government policy moved in a strongly activist direction. 
B)  the US has shifted from worrying about an economic depression to thinking about what kind of expansion the country will have. 
C)  the US has shifted from rescuing the economy to economic recovery. 
D)  All of the above are correct. 
A)  US government policy moved in a strongly activist direction. 
B)  the US has shifted from worrying about an economic depression to thinking about what kind of expansion the country will have. 
C)  the US has shifted from rescuing the economy to economic recovery. 
D)  All of the above are correct.

Question 2

The nation's antitrust laws are enforced by economists at the Department of

Accepted Answer

A)  Labor. 
B)  Health and Human Services. 
C)  Justice. 
D)  Treasury. 
A)  Labor. 
B)  Health and Human Services. 
C)  Justice. 
D)  Treasury.

Question 3

When two variables have a negative correlation,

Accepted Answer

A)  when the x-variable decreases, the y-variable decreases. 
B)  when the x-variable decreases, the y-variable increases. 
C)  when the x-variable increases, the y-variable increases. 
D)  More than one of the above is correct. 
A)  when the x-variable decreases, the y-variable decreases. 
B)  when the x-variable decreases, the y-variable increases. 
C)  when the x-variable increases, the y-variable increases. 
D)  More than one of the above is correct.

Question 4

Figure 2-8

-Refer to Figure 2-8,Panel (a).The opportunity cost of one cup of coffee is highest when the economy produces

Accepted Answer

A)  0 cups of coffee. 
B)  2 cups of coffee. 
C)  4 cups of coffee. 
D)  6 cups of coffee. 
A)  0 cups of coffee. 
B)  2 cups of coffee. 
C)  4 cups of coffee. 
D)  6 cups of coffee.

Question 5

The ordered pair that represents the origin on a graph is

Accepted Answer

A)  (1, 1). 
B)  (0, 0). 
C)  (-1, -1). 
D)  (   ). 
A)  (1, 1). 
B)  (0, 0). 
C)  (-1, -1). 
D)  (   ).

Question 6

An economic model can accurately explain how the economy is organized because it is designed to include,to the extent possible,all features of the real world.

Accepted Answer

A) True 
 B)False

Question 7

A microeconomist - as opposed to a macroeconomist - might study

Accepted Answer

A)  the effect of borrowing by the federal government on the inflation rate. 
B)  the effect of rising oil prices on employment in the airline industry. 
C)  changes in the nation's unemployment rate over short periods of time. 
D)  alternative policies to promote higher living standards throughout the nation. 
A)  the effect of borrowing by the federal government on the inflation rate. 
B)  the effect of rising oil prices on employment in the airline industry. 
C)  changes in the nation's unemployment rate over short periods of time. 
D)  alternative policies to promote higher living standards throughout the nation.

Question 8

When studying the effects of public policy changes,economists

Accepted Answer

A)  always refrain from making assumptions. 
B)  sometimes make different assumptions about the short run and the long run. 
C)  consider only the direct effects of those policy changes and not the indirect effects. 
D)  consider only the short-run effects of those policy changes and not the long-run effects. 
A)  always refrain from making assumptions. 
B)  sometimes make different assumptions about the short run and the long run. 
C)  consider only the direct effects of those policy changes and not the indirect effects. 
D)  consider only the short-run effects of those policy changes and not the long-run effects.

Question 9

When two variables move in opposite directions,the curve relating them is

Accepted Answer

A)  upward sloping, and we say the variables are positively related. 
B)  upward sloping, and we say the variables are negatively related. 
C)  downward sloping, and we say the variables are positively related. 
D)  downward sloping, and we say the variables are negatively related. 
A)  upward sloping, and we say the variables are positively related. 
B)  upward sloping, and we say the variables are negatively related. 
C)  downward sloping, and we say the variables are positively related. 
D)  downward sloping, and we say the variables are negatively related.

Question 10

In the circular-flow diagram,factors of production include land,labor,and capital.

Accepted Answer

A) True 
 B)False

Question 11

In a certain economy,jam and bread are produced,and the economy currently operates on its production possibilities frontier.Which of the following events would allow the economy to produce more jam and more bread,relative to the quantities of those goods that are being produced now?

Accepted Answer

A)  Unemployed labor is put to work producing jam and bread. 
B)  The economy puts its idle capital to work producing jam and bread. 
C)  The economy experiences economic growth. 
D)  All of the above are correct. 
A)  Unemployed labor is put to work producing jam and bread. 
B)  The economy puts its idle capital to work producing jam and bread. 
C)  The economy experiences economic growth. 
D)  All of the above are correct.

Question 12

When a variable that is not named on either axis of a graph changes,we read the change as a movement along the curve.

Accepted Answer

A) True 
 B)False

Question 13

In the markets for the factors of production in the circular-flow diagram,

Accepted Answer

A)  households are sellers and firms are buyers. 
B)  households are buyers and firms are sellers. 
C)  households and firms are both buyers. 
D)  households and firms are both sellers. 
A)  households are sellers and firms are buyers. 
B)  households are buyers and firms are sellers. 
C)  households and firms are both buyers. 
D)  households and firms are both sellers.

Question 14

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

Accepted Answer

A) True 
 B)False

Question 15

Table 2-3
Production Possibilities for Libraryland
  
-Refer to Table 2-3.What is the opportunity cost to Libraryland of increasing the production of books from 200 to 300?

Accepted Answer

A)  100 magazines 
B)  150 magazines 
C)  200 magazines 
D)  350 magazines 
A)  100 magazines 
B)  150 magazines 
C)  200 magazines 
D)  350 magazines

Question 16

Figure 2-5
  
-Refer to Figure 2-5.If this economy devotes one-half of its available resources to the production of soccer balls and the other half to the production of sweaters,it could produce

Accepted Answer

A)  150 sweaters and 100 soccer balls. 
B)  150 sweaters and 150 soccer balls. 
C)  300 sweaters and 200 soccer balls. 
D)  We would have to know the details of this economy's technology in order to determine this. 
A)  150 sweaters and 100 soccer balls. 
B)  150 sweaters and 150 soccer balls. 
C)  300 sweaters and 200 soccer balls. 
D)  We would have to know the details of this economy's technology in order to determine this.

Question 17

Figure 2-15
Relationship between Price and Cups of Coffee
  
-Refer to Figure 2-15.The slope of the line containing points Y and Z is

Accepted Answer

A)  -0.5. 
B)  -1. 
C)  -2. 
D)  -4. 
A)  -0.5. 
B)  -1. 
C)  -2. 
D)  -4.

Question 18

Economists speaking like scientists make

Accepted Answer

A)  positive statements. 
B)  prescriptive statements. 
C)  claims about how the world should be. 
D)  More than one of the above is correct. 
A)  positive statements. 
B)  prescriptive statements. 
C)  claims about how the world should be. 
D)  More than one of the above is correct.

Question 19

Figure 2-5
  
-Refer to Figure 2-5.If this economy devotes all of its resources to the production of sweaters,then it will produce

Accepted Answer

A)  0 sweaters and 200 soccer balls. 
B)  180 sweaters and 125 soccer balls. 
C)  300 sweaters and 0 soccer balls. 
D)  300 sweaters and 200 soccer balls. 
A)  0 sweaters and 200 soccer balls. 
B)  180 sweaters and 125 soccer balls. 
C)  300 sweaters and 0 soccer balls. 
D)  300 sweaters and 200 soccer balls.

Question 20

In the circular-flow diagram,households and firms are the decision makers.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist.

Larry Summers,a chief economic adviser to President Obama,stated that as a result of using Keynesian policies in 2008 and 2009,

The nation's antitrust laws are enforced by economists at the Department of

When two variables have a negative correlation,

Figure 2-8 -Refer to Figure 2-8,Panel (a).The opportunity cost of one cup of coffee is highest when the economy produces

The ordered pair that represents the origin on a graph is

An economic model can accurately explain how the economy is organized because it is designed to include,to the extent possible,all features of the real world.

A microeconomist - as opposed to a macroeconomist - might study

When studying the effects of public policy changes,economists

When two variables move in opposite directions,the curve relating them is

In the circular-flow diagram,factors of production include land,labor,and capital.

In a certain economy,jam and bread are produced,and the economy currently operates on its production possibilities frontier.Which of the following events would allow the economy to produce more jam and more bread,relative to the quantities of those goods that are being produced now?

When a variable that is not named on either axis of a graph changes,we read the change as a movement along the curve.

In the markets for the factors of production in the circular-flow diagram,

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

Table 2-3 Production Possibilities for Libraryland -Refer to Table 2-3.What is the opportunity cost to Libraryland of increasing the production of books from 200 to 300?

Figure 2-5 -Refer to Figure 2-5.If this economy devotes one-half of its available resources to the production of soccer balls and the other half to the production of sweaters,it could produce

Figure 2-15 Relationship between Price and Cups of Coffee -Refer to Figure 2-15.The slope of the line containing points Y and Z is

Economists speaking like scientists make

Figure 2-5 -Refer to Figure 2-5.If this economy devotes all of its resources to the production of sweaters,then it will produce

In the circular-flow diagram,households and firms are the decision makers.

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.

Application: 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 Market For the Factors of Production.

Earnings and Discrimination.

Income Inequality and Poverty.

The Theory of Consumer Choice.

Frontiers in Microeconomics.

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