Exam 2: Thinking Like an Economist

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. Which combination of points show production possibilities only achievable with improvements in technology or increases in resources?

If an economy is producing efficiently, then

The Federal Reserve

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

The President counts among his economic advisors the Congressional Budget Office.

When economists are trying to explain the world, they are scientists. When they are trying to improve it, they are

President Ronald Reagan once joked that a Trivial Pursuit game designed for economists would

Figure 2-8 -Refer to Figure 2-8. Point K represents an outcome in which

Figure 2-2 -Refer to Figure 2-2. Boxes A and B of this circular-flow diagram represent

Suppose a war in the Middle East interrupts the flow of crude oil and oil prices skyrocket around the world. For economists, this historical episode serves as a

Is the following a positive or normative statement? The federal minimum wage is lower than many state minimum wages.

The opportunity cost of obtaining more of one good is shown on the production possibilities frontier as the

Just like other scientific models, economic models simplify reality using

Figure 2-18 Relationship between Price and Restaurant Meals -Refer to Figure 2-18. Which of the following could result in a movement from point B to point Z?

While the production possibilities frontier is a useful model, it cannot be used to illustrate economic growth.

Figure 2-9 Panel a) Panel b) -Refer to Figure 2-9, Panel a). The movement from point M to point K could be caused by

In the markets for goods and services in the circular flow diagram, households act as

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

Which of the following is a positive, as opposed to a normative, statement?

Assumptions can simplify the complex world and make it easier to understand.