Question 1

The slope of a line that passes through the points (15,10)and (7,30)is

Accepted Answer

A)  -5/2. 
B)  -2/5. 
C)  2/5. 
D)  5/2. 
A)  -5/2. 
B)  -2/5. 
C)  2/5. 
D)  5/2.

Question 2

Economic models omit many details to allow us to see what is truly important.

Accepted Answer

A) True 
 B)False

Question 3

Economists believe that production possibilities frontiers rarely have a bowed shape.

Accepted Answer

A) True 
 B)False

Question 4

In a certain economy,brooms and radios are produced,and the economy currently operates on its production possibilities frontier.Which of the following events would allow the economy to produce more brooms and more radios,relative to the quantities of those goods that are being produced now?

Accepted Answer

A)  The economy experiences economic growth. 
B)  There is a technological advance in the broom industry,but the radio industry experiences no such advance. 
C)  There is a technological advance in the radio industry,but the broom industry experiences no such advance. 
D)  All of the above are correct. 
A)  The economy experiences economic growth. 
B)  There is a technological advance in the broom industry,but the radio industry experiences no such advance. 
C)  There is a technological advance in the radio industry,but the broom industry experiences no such advance. 
D)  All of the above are correct.

Question 5

Figure 2-4  
-Refer to Figure 2-4.Suppose this economy is producing at point D.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 6

Figure 2-7  
-Refer to Figure 2-7.Efficient production is represented by which point(s)?

Accepted Answer

A)  A 
B)  A,B 
C)  A,B,C 
D)  A,B,D 
A)  A 
B)  A,B 
C)  A,B,C 
D)  A,B,D

Question 7

The Congressional Budget Office,which is staffed by economists,provides Congress with independent evaluations of policy proposals.

Accepted Answer

A) True 
 B)False

Question 8

The essence of science is

Accepted Answer

A)  the laboratory experiment. 
B)  the scientific method. 
C)  the study of nature,but not the study of society. 
D)  All of the above are correct. 
A)  the laboratory experiment. 
B)  the scientific method. 
C)  the study of nature,but not the study of society. 
D)  All of the above are correct.

Question 9

Which of the following statements is correct?

Accepted Answer

A)  Economists almost always find it easy to conduct experiments in order to test their theories. 
B)  Economics is not a true science because economists are not usually allowed to conduct experiments to test their theories. 
C)  Economics is a social science rather than a true science because it cannot employ the scientific method. 
D)  Economists are usually not allowed to conduct experiments,so they must rely on natural experiments offered by history. 
A)  Economists almost always find it easy to conduct experiments in order to test their theories. 
B)  Economics is not a true science because economists are not usually allowed to conduct experiments to test their theories. 
C)  Economics is a social science rather than a true science because it cannot employ the scientific method. 
D)  Economists are usually not allowed to conduct experiments,so they must rely on natural experiments offered by history.

Question 10

The ordered pair that represents the origin on a graph is

Accepted Answer

A)  (1,1). 
B)  (0,0). 
C)  (-1,-1). 
D)  (). 
A)  (1,1). 
B)  (0,0). 
C)  (-1,-1). 
D)  ().

Question 11

Sometimes economists disagree because their values differ.Which of the following instances best reflects this source of disagreement?

Accepted Answer

A)  One economist believes the North American Free Trade Agreement (NAFT
A) has led to a loss of American jobs;another economist disputes this claim. 
B)  One economist believes that when income taxes are cut,people will increase their spending;another economist believes that when income taxes are cut,people will increase their saving. 
C)  One economist advises against increases in sales taxes because she thinks such increases are unfair to low-income people;another economist disputes the idea that increases in sales taxes are unfair to low-income people. 
D)  One economist believes that,prior to the Civil War,slavery contributed to economic growth in the South;another economist believes that slavery held back the South's economic growth. 
A)  One economist believes the North American Free Trade Agreement (NAFT
A) has led to a loss of American jobs;another economist disputes this claim. 
B)  One economist believes that when income taxes are cut,people will increase their spending;another economist believes that when income taxes are cut,people will increase their saving. 
C)  One economist advises against increases in sales taxes because she thinks such increases are unfair to low-income people;another economist disputes the idea that increases in sales taxes are unfair to low-income people. 
D)  One economist believes that,prior to the Civil War,slavery contributed to economic growth in the South;another economist believes that slavery held back the South's economic growth.

Question 12

Figure 2-1  
-Refer to Figure 2-1.Which arrow represents the flow of income payments?

Accepted Answer

A)  A 
B)  B 
C)  C 
D)  D 
A)  A 
B)  B 
C)  C 
D)  D

Question 13

Figure 2-14  
-Refer to Figure 2-14.Points A,B,and D represent feasible outcomes for this economy.

Accepted Answer

A) True 
 B)False

Question 14

Figure 2-12  
-Refer to Figure 2-12.The graph shown is known as a

Accepted Answer

A)  time-series graph. 
B)  bar graph. 
C)  scatterplot. 
D)  pie chart. 
A)  time-series graph. 
B)  bar graph. 
C)  scatterplot. 
D)  pie chart.

Question 15

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

Accepted Answer

A)  goods and services 
B)  land,labor,and capital 
C)  dollars spent on goods and services 
D)  wages,rent,and profit 
A)  goods and services 
B)  land,labor,and capital 
C)  dollars spent on goods and services 
D)  wages,rent,and profit

Question 16

Which of the following statements is correct about the roles of economists?

Accepted Answer

A)  Economists are best viewed as policy advisers. 
B)  Economists are best viewed as scientists. 
C)  In trying to explain the world,economists are policy advisers;in trying to improve the world,they are scientists. 
D)  In trying to explain the world,economists are scientists;in trying to improve the world,they are policy advisers. 
A)  Economists are best viewed as policy advisers. 
B)  Economists are best viewed as scientists. 
C)  In trying to explain the world,economists are policy advisers;in trying to improve the world,they are scientists. 
D)  In trying to explain the world,economists are scientists;in trying to improve the world,they are policy advisers.

Question 17

In order to display information on two variables,an economist must use

Accepted Answer

A)  a bar graph. 
B)  a pie chart. 
C)  the coordinate system. 
D)  a time-series graph. 
A)  a bar graph. 
B)  a pie chart. 
C)  the coordinate system. 
D)  a time-series graph.

Question 18

Use the following graph to answer the following questions.
a.How would point J be represented as an ordered pair?
b.What type of curve is this?
c.Does this curve show a positive or negative correlation between price and quantity?
d.Compute the slope of D1 between points J and L.
e. What is the slope of D1 between points L and N? Why would you not have to calculate this answer?
f. What is it called if we move from D1 to D2?
g. How do you know that the slope of D2 is the same as the slope of D1?

Accepted Answer

a.
(20,24)
b.
a demand curve
c.
a negati

Question 19

Figure 2-13  
-Refer to Figure 2-13.The movement from point A to point B is a(n)

Accepted Answer

A)  shift of the demand curve. 
B)  indication of a change in preferences for roses. 
C)  movement along the demand curve. 
D)  indication of an increase in income. 
A)  shift of the demand curve. 
B)  indication of a change in preferences for roses. 
C)  movement along the demand curve. 
D)  indication of an increase in income.

Question 20

For economists,historical episodes

Accepted Answer

A)  are not worthy of study because they offer few insights into current economic events and problems. 
B)  are not worthy of study because laboratory experiments provide more reliable data. 
C)  are worthy of study because economists rely entirely on observation,rather than on theory. 
D)  are worthy of study because they serve as valuable substitutes for laboratory experiments. 
A)  are not worthy of study because they offer few insights into current economic events and problems. 
B)  are not worthy of study because laboratory experiments provide more reliable data. 
C)  are worthy of study because economists rely entirely on observation,rather than on theory. 
D)  are worthy of study because they serve as valuable substitutes for laboratory experiments.

Exam 2: Thinking Like an Economist

The slope of a line that passes through the points (15,10)and (7,30)is

Economic models omit many details to allow us to see what is truly important.

Economists believe that production possibilities frontiers rarely have a bowed shape.

In a certain economy,brooms and radios are produced,and the economy currently operates on its production possibilities frontier.Which of the following events would allow the economy to produce more brooms and more radios,relative to the quantities of those goods that are being produced now?

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

Figure 2-7 -Refer to Figure 2-7.Efficient production is represented by which point(s)?

The Congressional Budget Office,which is staffed by economists,provides Congress with independent evaluations of policy proposals.

The essence of science is

Which of the following statements is correct?

The ordered pair that represents the origin on a graph is

Sometimes economists disagree because their values differ.Which of the following instances best reflects this source of disagreement?

Figure 2-1 -Refer to Figure 2-1.Which arrow represents the flow of income payments?

Figure 2-14 -Refer to Figure 2-14.Points A,B,and D represent feasible outcomes for this economy.

Figure 2-12 -Refer to Figure 2-12.The graph shown is known as a

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

Which of the following statements is correct about the roles of economists?

In order to display information on two variables,an economist must use

Figure 2-13 -Refer to Figure 2-13.The movement from point A to point B is a(n)

For economists,historical episodes

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 Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

Filters