Exam 2: Thinking Like an Economist

For economists, statements about the world are of two types:

Which of the following statements about economic models is correct?

Figure 2-9 -Refer to Figure 2-9, Panel (a) and Panel (b). A shift of the economy's production possibilities frontier from Panel (a) to Panel (b) could be caused by

The bowed shape of the production possibilities frontier can be explained by the fact that

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

A model can be accurately described as a

In principle, we can

Unemployment would cause an economy to

Figure 2-3 -Refer to Figure 2-3. Inefficient production is represented by which point(s)?

The slope of a line is the ratio of the vertical distance covered to the horizontal distance covered along the line.

In the early 19th century, the Russian government sent doctors to southern Russian villages to provide assistance during a cholera epidemic. The villagers noticed that wherever doctors appeared, people died. Therefore, many doctors were chased away from villages, and some were even killed. This reaction to the correlation between doctors and deaths is most likely a problem of

When two variables have a positive correlation,

If an economy is producing efficiently, then

Economists sometimes give conflicting advice because

Which of the following transactions does not take place in the markets for factors of production in the circular-flow diagram?

Figure 2-14 -Refer to Figure 2-14. When this economy produces 30 doghouses and 25 dishwashers there is full employment.

Which of the following is correct?

When economists make

Economist Joseph Schumpeter coined the phrase "creative destruction" to describe the process by which

Trade-offs are involved in most policy decisions.