Question 1

Figure 2-3  
-Refer to Figure 2-3. What are two elements not included in this figure that could be included in a more complex model?

Accepted Answer

government

Question 2

In the circular-flow diagram, in the markets for

Accepted Answer

A)  goods and services, households and firms are both sellers. 
B)  goods and services, households are sellers and firms are buyers. 
C)  the factors of production, households are sellers and firms are buyers. 
D)  the factors of production, households and firms are both buyers. 
A)  goods and services, households and firms are both sellers. 
B)  goods and services, households are sellers and firms are buyers. 
C)  the factors of production, households are sellers and firms are buyers. 
D)  the factors of production, households and firms are both buyers.

Question 3

Figure 2-23  
-Refer to Figure 2-23. If this economy uses all its resources in the dishwasher industry, it produces 35 dishwashers and no doghouses.

Accepted Answer

A) True 
 B)False

Question 4

Figure 2-3  
-Refer to Figure 2-3. What is flowing from rectangle 1 to oval A?

Accepted Answer

A)  revenue 
B)  goods and services sold 
C)  factors of production 
D)  labor, land, and capital 
A)  revenue 
B)  goods and services sold 
C)  factors of production 
D)  labor, land, and capital

Question 5

Figure 2-11  
-Refer to Figure 2-11. Which of the following events would explain the shift of the production possibilities frontier from A to B?

Accepted Answer

A)  The economy's citizens developed an enhanced taste for books. 
B)  The economy experienced a technological advance in the production of books. 
C)  More capital became available in the economy. 
D)  More labor became available in the economy. 
A)  The economy's citizens developed an enhanced taste for books. 
B)  The economy experienced a technological advance in the production of books. 
C)  More capital became available in the economy. 
D)  More labor became available in the economy.

Question 6

For economists, conducting experiments is often difficult and sometimes impossible.

Accepted Answer

A) True 
 B)False

Question 7

Economists at which administrative department analyze data on workers and those looking for work to help formulate labor-market policies?

Accepted Answer

The answer of Economists at which administrative department analyze data...

Question 8

Which of these statements about economic models is correct?

Accepted Answer

A)  For economists, economic models provide insights about the world. 
B)  Economic models are built with assumptions. 
C)  Economic models are often composed of equations and diagrams. 
D)  All of the above are correct. 
A)  For economists, economic models provide insights about the world. 
B)  Economic models are built with assumptions. 
C)  Economic models are often composed of equations and diagrams. 
D)  All of the above are correct.

Question 9

Macroeconomics is the study of

Accepted Answer

A)  individual decision makers. 
B)  international trade. 
C)  economy-wide phenomena. 
D)  markets for large products. 
A)  individual decision makers. 
B)  international trade. 
C)  economy-wide phenomena. 
D)  markets for large products.

Question 10

Figure 2-7  
-Refer to Figure 2-7. If this economy moved from point P to point N, then

Accepted Answer

A)  it still would not be producing efficiently. 
B)  there would be no gain in either engines or tvs. 
C)  it would be producing more engines and more tvs than at point P. 
D)  It is not possible for this economy to move from point P to point N without additional resources. 
A)  it still would not be producing efficiently. 
B)  there would be no gain in either engines or tvs. 
C)  it would be producing more engines and more tvs than at point P. 
D)  It is not possible for this economy to move from point P to point N without additional resources.

Question 11

Figure 2-3  
-Refer to Figure 2-3. Which shape refers to the markets for goods and services?

Accepted Answer

A)  oval A 
B)  oval B 
C)  rectangle 1 
D)  rectangle 2 
A)  oval A 
B)  oval B 
C)  rectangle 1 
D)  rectangle 2

Question 12

When studying the effects of public policy changes, economists

Accepted Answer

A)  always refrain from making assumptions. 
B)  sometimes make different assumptions about the short run and the long run. 
C)  consider only the direct effects of those policy changes and not the indirect effects. 
D)  consider only the short-run effects of those policy changes and not the long-run effects. 
A)  always refrain from making assumptions. 
B)  sometimes make different assumptions about the short run and the long run. 
C)  consider only the direct effects of those policy changes and not the indirect effects. 
D)  consider only the short-run effects of those policy changes and not the long-run effects.

Question 13

Which of the following statements best captures the relationship between microeconomics and macroeconomics?

Accepted Answer

A)  For the most part, microeconomists are unconcerned with macroeconomics, and macroeconomists are unconcerned with microeconomics. 
B)  Microeconomists study markets for small products, whereas macroeconomists study markets for large products. 
C)  Microeconomics and macroeconomics are distinct from one another, yet they are closely related. 
D)  Microeconomics is oriented toward policy studies, whereas macroeconomics is oriented toward theoretical studies. 
A)  For the most part, microeconomists are unconcerned with macroeconomics, and macroeconomists are unconcerned with microeconomics. 
B)  Microeconomists study markets for small products, whereas macroeconomists study markets for large products. 
C)  Microeconomics and macroeconomics are distinct from one another, yet they are closely related. 
D)  Microeconomics is oriented toward policy studies, whereas macroeconomics is oriented toward theoretical studies.

Question 14

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

Accepted Answer

A)  increases as more of the good is produced. 
B)  decreases as more of the good is produced. 
C)  does not change as more of the good is produced. 
D)  may increase, decrease, or not change as more of the good is produced. 
A)  increases as more of the good is produced. 
B)  decreases as more of the good is produced. 
C)  does not change as more of the good is produced. 
D)  may increase, decrease, or not change as more of the good is produced.

Question 15

Economic models are most often composed of diagrams and equations.

Accepted Answer

A) True 
 B)False

Question 16

Figure 2-14   Consider the production possibilities curve for a country that can produce sweaters, apples in bushels), or a combination of the two.
-Refer to Figure 2-14. The bowed outward shape of the production possibilities curve indicates that opportunity cost of apples in terms of sweaters is

Accepted Answer

The answer of Figure 2-14   Consider the production...

Question 17

The production possibilities frontier is used to illustrate some basic economic ideas, including

Accepted Answer

A)  scarcity. 
B)  opportunity cost. 
C)  economic growth. 
D)  All of the above are correct. 
A)  scarcity. 
B)  opportunity cost. 
C)  economic growth. 
D)  All of the above are correct.

Question 18

Economists, like mathematicians, physicists, and biologists,

Accepted Answer

A)  make use of the scientific method. 
B)  try to address their subject with a scientist's objectivity. 
C)  devise theories, collect data, and then analyze these data in an attempt to verify or refute their theories. 
D)  All of the above are correct. 
A)  make use of the scientific method. 
B)  try to address their subject with a scientist's objectivity. 
C)  devise theories, collect data, and then analyze these data in an attempt to verify or refute their theories. 
D)  All of the above are correct.

Question 19

With respect to how economists study the economy, which of the following statements is most accurate?

Accepted Answer

A)  Economists study the past, but they do not try to predict the future. 
B)  Economists use "rules of thumb" to predict the future. 
C)  Economists devise theories, collect data, and analyze the data to test the theories. 
D)  Economists use controlled experiments in much the same way that biologists and physicists do. 
A)  Economists study the past, but they do not try to predict the future. 
B)  Economists use "rules of thumb" to predict the future. 
C)  Economists devise theories, collect data, and analyze the data to test the theories. 
D)  Economists use controlled experiments in much the same way that biologists and physicists do.

Question 20

When economists disagree about whether the government should tax a household's income or its consumption, they are expressing a difference in

Accepted Answer

scientific

Exam 2: Thinking Like an Economist

Figure 2-3 -Refer to Figure 2-3. What are two elements not included in this figure that could be included in a more complex model?

In the circular-flow diagram, in the markets for

Figure 2-23 -Refer to Figure 2-23. If this economy uses all its resources in the dishwasher industry, it produces 35 dishwashers and no doghouses.

Figure 2-3 -Refer to Figure 2-3. What is flowing from rectangle 1 to oval A?

Figure 2-11 -Refer to Figure 2-11. Which of the following events would explain the shift of the production possibilities frontier from A to B?

For economists, conducting experiments is often difficult and sometimes impossible.

Economists at which administrative department analyze data on workers and those looking for work to help formulate labor-market policies?

Which of these statements about economic models is correct?

Macroeconomics is the study of

Figure 2-7 -Refer to Figure 2-7. If this economy moved from point P to point N, then

Figure 2-3 -Refer to Figure 2-3. Which shape refers to the markets for goods and services?

When studying the effects of public policy changes, economists

Which of the following statements best captures the relationship between microeconomics and macroeconomics?

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

Economic models are most often composed of diagrams and equations.

Figure 2-14 Consider the production possibilities curve for a country that can produce sweaters, apples in bushels), or a combination of the two. -Refer to Figure 2-14. The bowed outward shape of the production possibilities curve indicates that opportunity cost of apples in terms of sweaters is

The production possibilities frontier is used to illustrate some basic economic ideas, including

Economists, like mathematicians, physicists, and biologists,

With respect to how economists study the economy, which of the following statements is most accurate?

When economists disagree about whether the government should tax a household's income or its consumption, they are expressing a difference in

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

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

Six Debates Over Macroeconomic Policy

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