Exam 2: Thinking Like an Economist

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

While the scientific method is applicable to studying natural sciences, it is not applicable to studying a nation's economy.

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

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

A circular-flow model and production possibilities frontier are similar in that

Economists sometimes give conflicting advice because

A model can be accurately described as a

Figure 2-16 -Refer to Figure 2-16. Taking cause and effect into account, which of the following interpretations would be most reasonable regarding the relationship between coffee and hours without sleep?

A pie chart is a way to display information regarding two variables.

Since 1946, the president of the United States has received guidance from a group comprised of three members and a staff of a few dozen economists known as the

Trade-offs are involved in most policy decisions.

Which of the following statements is correct?

The slope of a line that passes through the points 20, 30) and 40, 14) is

An outcome is said to be efficient if an economy is getting all it can from the scarce resources it has available.

Figure 2-23 -Refer to Figure 2-23. Points A, B, and D represent feasible outcomes for this economy.

Figure 2-16 -Refer to Figure 2-16. The graph shown is known as a

Which of the following statements about models is correct?

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

When economists make positive statements, they are

When an economist is asked a question like "why is unemployment higher for teenagers than for older workers?" the economist