Question 1

The use of the coordinate system allows

Accepted Answer

A)  for the display of the flows of dollars, goods and services, and factors of production in an economic system. 
B)  for the display of how labor and other resources are organized in the production process. 
C)  for the display of two variables on a single graph. 
D)  for the creation of pie charts and bar graphs. 
A)  for the display of the flows of dollars, goods and services, and factors of production in an economic system. 
B)  for the display of how labor and other resources are organized in the production process. 
C)  for the display of two variables on a single graph. 
D)  for the creation of pie charts and bar graphs.

Question 2

Albert Einstein once made the following observation about science:

Accepted Answer

A)  "The whole of science is nothing more than the refinement of everyday thinking." 
B)  "The whole of science is nothing more than an interesting intellectual exercise." 
C)  "In order to understand science, one must rely solely on abstraction." 
D)  "In order to understand science, one must transcend everyday thinking." 
A)  "The whole of science is nothing more than the refinement of everyday thinking." 
B)  "The whole of science is nothing more than an interesting intellectual exercise." 
C)  "In order to understand science, one must rely solely on abstraction." 
D)  "In order to understand science, one must transcend everyday thinking."

Question 3

Figure 2-15
Relationship between Price and Cups of Coffee
  
-Refer to Figure 2-15.Which of the following could result in a movement from point B to point Z?

Accepted Answer

A)  a change in the price of coffee 
B)  a change in the number of cups of coffee demanded 
C)  a change in income 
D)  More than one of the above is correct. 
A)  a change in the price of coffee 
B)  a change in the number of cups of coffee demanded 
C)  a change in income 
D)  More than one of the above is correct.

Question 4

Points on the production possibilities frontier represent efficient levels of production.

Accepted Answer

A) True 
 B)False

Question 5

Microeconomics is the study of how households and firms make decisions and how they interact in specific markets.

Accepted Answer

A) True 
 B)False

Question 6

Differences in scientific judgement between economists is similar to all of the following except

Accepted Answer

A)  astronomers debating whether the sun or earth was at the center of the solar system. 
B)  meteorologists debating the existence of global warming. 
C)  two politicians arguing about the fairness of the tax code. 
D)  explorers debating whether or not the earth was flat before the time of Christopher Columbus. 
A)  astronomers debating whether the sun or earth was at the center of the solar system. 
B)  meteorologists debating the existence of global warming. 
C)  two politicians arguing about the fairness of the tax code. 
D)  explorers debating whether or not the earth was flat before the time of Christopher Columbus.

Question 7

A pie chart is a way to display information regarding two variables.

Accepted Answer

A) True 
 B)False

Question 8

Figure 2-8

-Refer to Figure 2-8,Panel (a).In order to gain 2 donuts by moving from point L to point M,society must sacrifice

Accepted Answer

A)  efficiency. 
B)  employment. 
C)  4 cups of coffee. 
D)  More than one of the above is correct. 
A)  efficiency. 
B)  employment. 
C)  4 cups of coffee. 
D)  More than one of the above is correct.

Question 9

Figure 2-4
  
-Refer to Figure 2-4.Suppose this economy is producing at point W.Which of the following statements would best explain this situation?

Accepted Answer

A)  The economy lacks the resources to produce at a more desirable point. 
B)  The economy's available technology prevents it from producing at a more desirable point. 
C)  There is widespread unemployment in the economy. 
D)  Any of the above statements would be a legitimate explanation for this situation. 
A)  The economy lacks the resources to produce at a more desirable point. 
B)  The economy's available technology prevents it from producing at a more desirable point. 
C)  There is widespread unemployment in the economy. 
D)  Any of the above statements would be a legitimate explanation for this situation.

Question 10

Figure 2-2
  
-Refer to Figure 2-2.If households are sellers in the markets represented by Box D of this circular-flow diagram,then

Accepted Answer

A)  Box D must represent the markets for factors of production. 
B)  Box C must represent the markets for goods and services. 
C)  firms are buyers in the markets represented by Box D. 
D)  All of the above are correct. 
A)  Box D must represent the markets for factors of production. 
B)  Box C must represent the markets for goods and services. 
C)  firms are buyers in the markets represented by Box D. 
D)  All of the above are correct.

Question 11

Figure 2-4
  
-Refer to Figure 2-4.It is possible for this economy to produce

Accepted Answer

A)  40 notepads and 20 lamps. 
B)  50 notepads and 30 lamps. 
C)  70 notepads and 40 lamps. 
D)  All of the above. 
A)  40 notepads and 20 lamps. 
B)  50 notepads and 30 lamps. 
C)  70 notepads and 40 lamps. 
D)  All of the above.

Question 12

Which of the following is correct?

Accepted Answer

A)  A horizontal line has an infinite slope, and a vertical line has a zero slope. 
B)  A horizontal line has a slope of 1, and a vertical line has a slope of -1. 
C)  A horizontal line has a zero slope, and a vertical line has an infinite slope. 
D)  A horizontal line has a slope of -1, and a vertical line has a slope of 1. 
A)  A horizontal line has an infinite slope, and a vertical line has a zero slope. 
B)  A horizontal line has a slope of 1, and a vertical line has a slope of -1. 
C)  A horizontal line has a zero slope, and a vertical line has an infinite slope. 
D)  A horizontal line has a slope of -1, and a vertical line has a slope of 1.

Question 13

Figure 2-15
Relationship between Price and Cups of Coffee
  
-Refer to Figure 2-15.A movement from point A to point B is called

Accepted Answer

A)  a shift in demand. 
B)  a movement along the demand curve. 
C)  a shift in supply. 
D)  a movement along the supply curve. 
A)  a shift in demand. 
B)  a movement along the demand curve. 
C)  a shift in supply. 
D)  a movement along the supply curve.

Question 14

Figure 2-2
  
-Refer to Figure 2-2.Devin works as an attorney for a corporation and is paid a salary in exchange for the legal services he performs.Juan owns office buildings and rents his buildings to companies in exchange for rent payments.If Devin's income is represented by a flow of dollars from Box D to Box B of this circular-flow diagram,then Juan's income is represented by a flow of dollars

Accepted Answer

A)  from Box A to Box C. 
B)  from Box C to Box A. 
C)  from Box B to Box D. 
D)  from Box D to Box B. 
A)  from Box A to Box C. 
B)  from Box C to Box A. 
C)  from Box B to Box D. 
D)  from Box D to Box B.

Question 15

Economists at the U.S.Department of Justice help enforce the nation's antitrust laws.

Accepted Answer

A) True 
 B)False

Question 16

The slope of a line passing through the points (12,8)and (16,5)is

Accepted Answer

A)  -3/4. 
B)  3/4. 
C)  -4/3. 
D)  4/3. 
A)  -3/4. 
B)  3/4. 
C)  -4/3. 
D)  4/3.

Question 17

Figure 2-14
  
-Refer to Figure 2-14.Unemployment could cause this economy to produce at point B.

Accepted Answer

A) True 
 B)False

Question 18

Points outside the production possibilities frontier represent infeasible levels of production.

Accepted Answer

A) True 
 B)False

Question 19

Figure 2-8

-Refer to Figure 2-8,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 20

Trade-offs are involved in most policy decisions.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist.

The use of the coordinate system allows

Albert Einstein once made the following observation about science:

Figure 2-15 Relationship between Price and Cups of Coffee -Refer to Figure 2-15.Which of the following could result in a movement from point B to point Z?

Points on the production possibilities frontier represent efficient levels of production.

Microeconomics is the study of how households and firms make decisions and how they interact in specific markets.

Differences in scientific judgement between economists is similar to all of the following except

A pie chart is a way to display information regarding two variables.

Figure 2-8 -Refer to Figure 2-8,Panel (a).In order to gain 2 donuts by moving from point L to point M,society must sacrifice

Figure 2-4 -Refer to Figure 2-4.Suppose this economy is producing at point W.Which of the following statements would best explain this situation?

Figure 2-2 -Refer to Figure 2-2.If households are sellers in the markets represented by Box D of this circular-flow diagram,then

Figure 2-4 -Refer to Figure 2-4.It is possible for this economy to produce

Which of the following is correct?

Figure 2-15 Relationship between Price and Cups of Coffee -Refer to Figure 2-15.A movement from point A to point B is called

Economists at the U.S.Department of Justice help enforce the nation's antitrust laws.

The slope of a line passing through the points (12,8)and (16,5)is

Figure 2-14 -Refer to Figure 2-14.Unemployment could cause this economy to produce at point B.

Points outside the production possibilities frontier represent infeasible levels of production.

Figure 2-8 -Refer to Figure 2-8,Panel (a).Production is

Trade-offs are involved in most policy decisions.

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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