Exam 2: Thinking Like an Economist

Table 2-6 -Refer to Table 2-6. Consider the production possibilities table for an economy that produces only mobile phones and pizzas. Describe the shape of the production possibilities frontier.

Among economic models, the circular-flow diagram is unusual in that it

In the circular-flow diagram, households and firms are the decision makers.

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

In conducting their research, economists face an obstacle that not all scientists face; specifically, in economics, it is often impractical to

Economists at the Department of Justice

Figure 2-2 -Refer to Figure 2-2. If the outer loop of this circular-flow diagram represents flows of dollars, then the inner loop includes

In the circular flow diagram, when Brian provides labor through the markets for factors of production to ABC Company, the flow of money he receives in exchange is called

The slope of a fairly flat upward-sloping line will be a

To display information on two variables, an economist must use

Evaluating normative statements involves values as well as facts.

When an economy is operating at a point on its production possibilities frontier, then

Figure 2-4 -Refer to Figure 2-4. At which point is this economy producing its maximum possible quantity of doors?

The production possibilities frontier is a graph that shows the various combinations of output that an economy

In the circular-flow diagram, firms produce

Figure 2-22 -Refer to Figure 2-22. Is a move from point A to point B considered a shift of the curve or a movement along the curve?

Who would be more likely to study the effects of foreign competition on the accounting industry, a macroeconomist or a microeconomist?

"Ensuring that Social Security is financially sound for future generations is an important use of taxpayer dollars" is an example of a

Economic growth causes a production possibilities frontier to shift outward.

Almost all economists agree that rent control