Exam 2: Thinking Like an Economist

Figure 2-5 -Refer to Figure 2-5. If this economy moves from point A to point B, then which of the following statements is correct?

The argument that purchases of minivans cause large families is an example of

Which of the following statements about the circular-flow diagram is correct?

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

Figure 2-5 -Refer to Figure 2-5. The opportunity cost of this economy moving from point A to point C is

The production possibilities frontier illustrates

A production possibilities frontier has a bowed shape if the opportunity cost is constant at all levels of output.

When two variables have a negative correlation and the x-variable decreases,

Economic models are most often composed of diagrams and equations.

Congress relies on economists at the Congressional Budget Office to

A macroeconomist - as opposed to a microeconomist - might study

Which of the following is a correct statement about production possibilities frontiers?

The use of the coordinate system allows

Normative statements are not

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

Policymaking in a representative democracy

Figure 2-2 -Refer to Figure 2-2. If the flow of goods and services is part of what is represented by the inner loop of this circular-flow diagram, then

Two variables that have a positive correlation move in the same direction.

Positive statements can be evaluated using data alone, but normative statements cannot.

A certain production possibilities frontier shows production possibilities for two goods, jewelry and clothing. Which of the following concepts cannot be illustrated by this model?