Exam 1: What Is Economics

If a decision maker uses marginal analysis, then the relevant costs are the

A diagram is a good example of a(n)

It has been found that people die at a much higher rate in hospitals than in most other environments, leading some to conclude that hospitals cause death. What is the problem with this reasoning?

What are the tools available to governments to mitigate cycles of boom and bust? Why do these tools fail?

In terms of the competing claims of equality and efficiency, in the United States we have

Rational choice requires that opportunity cost be

Efforts to reduce the unemployment rate are likely, in the short run, to lead to

When economists are critical of government regulations that prohibit free individuals from making certain kinds of contracts, for example, to purchase a good or service, they will usually invoke the concept of

Economic models are rarely constructed using

All economic transactions involve only buyers and sellers; no third parties are involved.

The process of focusing on only the most important factors to explain a phenomenon is called

In 1980, in order to stimulate agricultural production, Fidel Castro allowed Cuban farmers to sell their goods directly to consumers and keep whatever profit they made. Some farmers were earning $50,000 per year, compared with the average worker income of $2,400. The workers resented this. Castro denounced the farmers as "capitalist gangsters" and closed the free markets. Cuban cash income declined 5 percent and fresh vegetables were in short supply. This illustrates the economic concept of the

Opportunity cost is the

In her calculation of the cost of going to college, an economist would include the amount of forgone earnings over the years spent at college.

The steepness of a curve is partially determined by the units of measurement.

Although economic science can contribute theoretical and factual knowledge on a particular issue, the final decision on policy questions often depends on

Only economists and other "social" scientists have areas of dispute within their disciplines.

Economics is a social science rather than a "hard" science like physics because

The US Navy determines that the navigation system on its submarines, which use low-frequency radio waves, is reducing the population of humpback whales. The is an example of

A theory can best be defined as