Question 1

Figure 2-21 
-Refer to Figure 2-21. Which of the following could be an omitted variable in the graph?

Accepted Answer

A)   the price of snowblowers
B)   a change in consumers' incomes
C)   a change in the seasons
D)   All of the above are correct.E) B) and C)
F) A) and D)

Question 2

Almost all economists agree that rent control

Accepted Answer

A)   has no effect on the rental income of landlords.
B)   allows the market for housing to work more efficiently.
C)   adversely affects the availability and quality of housing.
D)   is a very inexpensive way to help the most needy members of society.E) All of the above
F) A) and B)

Question 3

The slope of an upward-sloping line is positive, and the slope of a downward-sloping line is negative.

Accepted Answer

A) True 
 B)False

Question 4

Points inside the production possibilities frontier represent inefficient levels of production.

Accepted Answer

A) True 
 B)False

Question 5

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

Accepted Answer

A)   flows of goods and services from households to firms.
B)   flows of inputs from households to firms.
C)   flows of rent payments paid to owners of land.
D)   flows of wages and salaries paid to workers.E) A) and D)
F) B) and C)

Question 6

Figure 2-12 
-Refer to Figure 2-12. The shift of the production possibilities frontier from A to B can best be described as

Accepted Answer

A)   a downturn in the economy.
B)   economic growth.
C)   an enhancement of equality.
D)   an improvement in the allocation of resources.E) C) and D)
F) All of the above

Question 7

Which of these terms are used interchangeably?

Accepted Answer

A)   "goods and services" and "inputs"
B)   "goods and services" and "factors of production"
C)   "inputs" and "factors of production"
D)   "land, labor, and capital" and "goods and services"E) None of the above
F) All of the above

Question 8

The opportunity cost of something is what you give up to get it.

Accepted Answer

A) True 
 B)False

Question 9

Table 2-1
The following table contains some production possibilities for an economy for a given month.
 
-Refer to Table 2-1. If the production possibilities frontier is bowed outward, then "?" could be

Accepted Answer

A)   400.
B)   450.
C)   600.
D)   750.E) B) and C)
F) All of the above

Question 10

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

Accepted Answer

A)   small positive number.
B)   large positive number.
C)   small negative number.
D)   large negative number.E) A) and B)
F) A) and C)

Question 11

Which of the following is not an example of a graph of a single variable?

Accepted Answer

A)   a pie chart
B)   a bar graph
C)   a time-series graph
D)   a scatterplotE) A) and B)
F) A) and D)

Question 12

Figure 2-23 
-Refer to Figure 2-23. The opportunity cost of moving from point B to point A is zero.

Accepted Answer

A) True 
 B)False

Question 13

Most economists agree that a large federal budget deficit has what type of effect on the economy?

Accepted Answer

The answer of Most economists agree that a large federal...

Question 14

Suppose an economy produces two goods, food and machines. This economy always operates on its production possibilities frontier. Last year, it produced 1000 units of food and 47 machines. This year it experienced a technological advance in its machine-making industry. As a result, this year the society wants to produce 1050 units of food and 47 machines. Which of the following statements is correct?

Accepted Answer

A)   Because the technological advance occurred in the machine-making industry, it will not be possible to increase food production without reducing machine production below 47.
B)   Because the technological advance occurred in the machine-making industry, increases in output can only occur in the machine industry.
C)   In order to increase food production in these circumstances without reducing machine production, the economy must reduce inefficiencies.
D)   The technological advance reduced the amount of resources needed to produce 47 machines, so these resources could be used to produce more food.E) A) and D)
F) All of the above

Question 15

Using the outline below, draw a circular-flow diagram representing the interactions between households and firms in a simple economy. Explain briefly the various parts of the diagram.

Accepted Answer

<img  loading="lazy" src="/assets/images/blured-textbook.svg" class="d-inline m-1" alt="blured image" width="139" height="30"> This diagram should duplicate the essen...

Question 16

Almost all economists agree that tariffs and import quotas

Accepted Answer

A)   reduces general economic welfare.
B)   increases general economic welfare.
C)   have no effect on general economic welfare.
D)   stimulate a less than fully employed economy.E) All of the above
F) A) and B)

Question 17

Which of the following statements about the circular-flow diagram is correct?

Accepted Answer

A)   One must imagine that the economy operates without money in order to make sense of the diagram.
B)   The diagram leaves out details that are not essential for understanding the economic transactions that occur between households and firms.
C)   The government cannot be excluded as a decision maker in a circular-flow diagram.
D)   All of the above are correct.E) None of the above
F) A) and C)

Question 18

Which of the following is not correct?

Accepted Answer

A)   Evaluating statements about how the world should be involves values as well as facts.
B)   Positive statements can, in principle, be confirmed or refuted by examining evidence.
C)   Normative statements can be judged using data alone.
D)   Deciding what is good or bad policy is not just a matter of science.E) A) and D)
F) B) and D)

Question 19

Figure 2-5 
-Refer to Figure 2-5. Efficient production is represented by which points) ?

Accepted Answer

A)   A, B
B)   A, B, D
C)   A, B, C
D)   CE) B) and D)
F) A) and C)

Question 20

"Society would be better off if the welfare system were abolished" is a normative statement, not a positive statement.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist

Which of the following statements about the circular-flow diagram is correct?

Correct Answer
verified

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

Correct Answer
verified

Points inside the production possibilities frontier represent inefficient levels of production.

Correct Answer
verified

Almost all economists agree that rent control

Correct Answer
verified

Most economists agree that a large federal budget deficit has what type of effect on the economy?

Correct Answer
verified

Using the outline below, draw a circular-flow diagram representing the interactions between households and firms in a simple economy. Explain briefly the various parts of the diagram.

Correct Answer
verified
This diagram should duplicate the essen...
View Answer

Almost all economists agree that tariffs and import quotas

Correct Answer
verified

Table 2-1 The following table contains some production possibilities for an economy for a given month. -Refer to Table 2-1. If the production possibilities frontier is bowed outward, then "?" could be

Correct Answer
verified

The slope of an upward-sloping line is positive, and the slope of a downward-sloping line is negative.

Correct Answer
verified

Correct Answer
verified

Figure 2-12 -Refer to Figure 2-12. The shift of the production possibilities frontier from A to B can best be described as

Correct Answer
verified

Which of the following is not correct?

Correct Answer
verified

The opportunity cost of something is what you give up to get it.

Correct Answer
verified

Which of the following is not an example of a graph of a single variable?

Correct Answer
verified

"Society would be better off if the welfare system were abolished" is a normative statement, not a positive statement.

Correct Answer
verified

Figure 2-21 -Refer to Figure 2-21. Which of the following could be an omitted variable in the graph?

Correct Answer
verified

Figure 2-23 -Refer to Figure 2-23. The opportunity cost of moving from point B to point A is zero.

Correct Answer
verified

Which of these terms are used interchangeably?

Correct Answer
verified

Figure 2-5 -Refer to Figure 2-5. Efficient production is represented by which points) ?

Correct Answer
verified

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

Correct Answer
verified

Exam 2: Thinking Like an Economist

Which of the following statements about the circular-flow diagram is correct?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Points inside the production possibilities frontier represent inefficient levels of production.

Correct AnswerverifiedShow Answer

Almost all economists agree that rent control

Correct AnswerverifiedShow Answer

Most economists agree that a large federal budget deficit has what type of effect on the economy?

Correct AnswerverifiedShow Answer

Using the outline below, draw a circular-flow diagram representing the interactions between households and firms in a simple economy. Explain briefly the various parts of the diagram.

Correct Answerverified This diagram should duplicate the essen...View AnswerShow Answer

Almost all economists agree that tariffs and import quotas

Correct AnswerverifiedShow Answer

Table 2-1 The following table contains some production possibilities for an economy for a given month. -Refer to Table 2-1. If the production possibilities frontier is bowed outward, then "?" could be

Correct AnswerverifiedShow Answer

The slope of an upward-sloping line is positive, and the slope of a downward-sloping line is negative.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 2-12 -Refer to Figure 2-12. The shift of the production possibilities frontier from A to B can best be described as

Correct AnswerverifiedShow Answer

Which of the following is not correct?

Correct AnswerverifiedShow Answer

The opportunity cost of something is what you give up to get it.

Correct AnswerverifiedShow Answer

Which of the following is not an example of a graph of a single variable?

Correct AnswerverifiedShow Answer

"Society would be better off if the welfare system were abolished" is a normative statement, not a positive statement.

Correct AnswerverifiedShow Answer

Figure 2-21 -Refer to Figure 2-21. Which of the following could be an omitted variable in the graph?

Correct AnswerverifiedShow Answer

Figure 2-23 -Refer to Figure 2-23. The opportunity cost of moving from point B to point A is zero.

Correct AnswerverifiedShow Answer

Which of these terms are used interchangeably?

Correct AnswerverifiedShow Answer

Figure 2-5 -Refer to Figure 2-5. Efficient production is represented by which points) ?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
This diagram should duplicate the essen...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified