Exam 2: Thinking Like an Economist

Which of the following is one of the basic reasons why economists often appear to give conflicting advice to policymakers?

Figure 2-6 -Refer to Figure 2-6. This economy cannot produce at which point(s)?

When a production possibilities frontier is bowed outward, the opportunity cost of producing an additional unit of a good

Figure 2-1 -Refer to Figure 2-1. Which arrow represents the flow of land, labor, and capital?

You know an economist has crossed the line from policy adviser to scientist when he or she

"Minimum wage laws result in unemployment" is a normative statement, while "the minimum wage should be higher" is a positive statement.

Figure 2-14 -Refer to Figure 2-14. It is possible for this economy to produce 75 doghouses.

Factors of production are

Figure 2-4 -Refer to Figure 2-4. Efficient production is represented by which point(s)?

Normative statements are

All scientific models, including economic models, simplify reality in order to improve our understanding of it.

Deciding that A causes B when in fact B causes A is a mistake called omitted variable bias.

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

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

Which of the following is not correct?

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

Figure 2-2 -Refer to Figure 2-2. If the outer loop of this circular-flow diagram represents flows of dollars, then the inner loop includes

In the ordered pair (17, 75), 75 is the

Which of the following is not correct?

A statement describing how the world is