Question 1

Which of the following is not correct about most economic models?

Accepted Answer

A)   They are composed of equations and diagrams.
B)   They contribute very little to economists' understanding of the real world.
C)   They omit many features of the real-world economy.
D)   In constructing models,economists make assumptions.E) A) and B)
F) A) and C)

Question 2

If an economy is producing efficiently,then

Accepted Answer

A)   there is no way to produce more of one good without producing less of another good.
B)   it is possible to produce more of both goods without increasing the quantities of inputs that are being used.
C)   it is possible to produce more of one good without producing less of another good.
D)   it is not possible to produce more of any good at any cost.E) A) and B)
F) B) and C)

Question 3

Home is a country that produces two goods,pears and cellular phones.Last year,Home produced 450 bushels of pears and 1050 cellular phones.This year it produced 450 bushels of pears and 2000 cellular phones.Given no other information,which of the following events could explain this change?

Accepted Answer

A)   Home experienced increased unemployment.
B)   Home experienced a decline in pear-producing technology.
C)   Home experienced an improvement in cellular phone-making technology.
D)   Home experienced a reduction in resources.E) None of the above
F) C) and D)

Question 4

Which of the following statements is correct?

Accepted Answer

A)   Few economic models incorporate assumptions.
B)   Different economic models employ different sets of assumptions.
C)   Good economic models attempt to mimic reality as closely as possible.
D)   Economic models,to be accepted,must be tested by conducting experiments.E) A) and B)
F) B) and C)

Question 5

"If all economists were laid end to end,they would not reach a conclusion." Who made this whimsical observation?

Accepted Answer

A)   Harry Truman
B)   George Bernard Shaw
C)   John Maynard Keynes
D)   Ronald ReaganE) A) and B)
F) B) and C)

Question 6

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.E) All of the above
F) A) and B)

Question 7

Economists at the U.S.Department of the Treasury help design U.S.coins and paper money.

Accepted Answer

A) True 
 B)False

Question 8

In building economic models,economists often omit

Accepted Answer

A)   assumptions.
B)   theories.
C)   details.
D)   equations.E) A) and B)
F) C) and D)

Question 9

Economists hold many positions advising the president and Congress including

Accepted Answer

A)   being a member of the Council of Economic Advisers.
B)   helping to enforce antitrust laws at the Department of Justice.
C)   conducting research at the Congressional Budget Office.
D)   All of these are possible positions that economists hold.E) All of the above
F) C) and D)

Question 10

A duty of economists at the Department of Labor is to

Accepted Answer

A)   analyze data on workers.
B)   schedule federal holidays.
C)   enforce the nation's antitrust laws.
D)   All of the above are correct.E) B) and C)
F) All of the above

Question 11

Economists try to address their subject with a scientist's objectivity.

Accepted Answer

A) True 
 B)False

Question 12

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) A) and B)
F) A) and C)

Question 13

Figure 2-8
 
-Refer to Figure 2-8,Panel (a) .The opportunity cost of moving from point M to point L is

Accepted Answer

A)   2 donuts.
B)   2 donuts and 4 cups of coffee.
C)   4 donuts.
D)   4 cups of coffee.E) A) and B)
F) A) and C)

Question 14

All scientific models,including economic models,simplify reality in order to improve our understanding of it.

Accepted Answer

A) True 
 B)False

Question 15

Draw a production possibilities frontier showing increasing opportunity cost of hammers in terms of horseshoes.
a.
On the graph,identify the area of feasible outcomes and the area of infeasible outcomes.
b.
On the graph,label a point that is efficient and a point that is inefficient.
c.
On the graph,illustrate the effect of the discovery of a new vein of iron ore,a resource needed to make both horseshoes and hammers,on this economy.
d.
On a second graph,illustrate the effect of a new computerized assembly line in the production of hammers on this economy.

Accepted Answer

The answer of Draw a production possibilities frontier showing increasing...

Question 16

Figure 2-8
 
-Refer to Figure 2-8,Panel (a) .The movement from point M to point K could be caused by

Accepted Answer

A)   an advance in production technology.
B)   an improvement in efficiency.
C)   economic growth.
D)   unemployment.E) None of the above
F) A) and B)

Question 17

Figure 2-2 
-Refer to Figure 2-2.If the owners of land,labor,and capital are represented by Box B of this circular-flow diagram,then

Accepted Answer

A)   households are represented by Box A.
B)   firms are represented by Box C.
C)   firms are represented by Box A.
D)   firms are sellers in Box B.E) A) and C)
F) A) and D)

Question 18

Which two groups of decision makers are included in the simple circular-flow diagram?

Accepted Answer

A)   markets and government
B)   households and government
C)   firms and government
D)   households and firmsE) None of the above
F) C) and D)

Question 19

Policymaking in a representative democracy

Accepted Answer

A)   is straightforward and does not involve any disagreement.
B)   benefits from the input of economists,even if their advice is not always followed.
C)   is conducted without the input of economists.
D)   is always based exclusively on the results of economic analysis.E) B) and D)
F) A) and B)

Question 20

When an economy is operating inside its production possibilities frontier,we know that

Accepted Answer

A)   there are unused resources or inefficiencies in the economy.
B)   all of the economy's resources are fully employed.
C)   economic growth would have to occur in order for the economy to move to a point on the frontier.
D)   in order to produce more of one good,the economy would have to give up some of the other good.E) B) and C)
F) B) and D)

Exam 2: Thinking Like an Economist

All scientific models,including economic models,simplify reality in order to improve our understanding of it.

Correct Answer
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Which two groups of decision makers are included in the simple circular-flow diagram?

Correct Answer
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Figure 2-8 -Refer to Figure 2-8,Panel (a) .The movement from point M to point K could be caused by

Correct Answer
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A duty of economists at the Department of Labor is to

Correct Answer
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Figure 2-2 -Refer to Figure 2-2.If the owners of land,labor,and capital are represented by Box B of this circular-flow diagram,then

Correct Answer
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Economists hold many positions advising the president and Congress including

Correct Answer
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Which of the following is not correct about most economic models?

Correct Answer
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Which of these statements about economic models is correct?

Correct Answer
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Economists try to address their subject with a scientist's objectivity.

Correct Answer
verified

Economists at the U.S.Department of the Treasury help design U.S.coins and paper money.

Correct Answer
verified

Which of the following statements is correct?

Correct Answer
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Correct Answer
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Figure 2-8 -Refer to Figure 2-8,Panel (a) .The opportunity cost of moving from point M to point L is

Correct Answer
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Home is a country that produces two goods,pears and cellular phones.Last year,Home produced 450 bushels of pears and 1050 cellular phones.This year it produced 450 bushels of pears and 2000 cellular phones.Given no other information,which of the following events could explain this change?

Correct Answer
verified

Policymaking in a representative democracy

Correct Answer
verified

If an economy is producing efficiently,then

Correct Answer
verified

In building economic models,economists often omit

Correct Answer
verified

"If all economists were laid end to end,they would not reach a conclusion." Who made this whimsical observation?

Correct Answer
verified

When an economy is operating inside its production possibilities frontier,we know that

Correct Answer
verified

Which of these terms are used interchangeably?

Correct Answer
verified

Exam 2: Thinking Like an Economist

All scientific models,including economic models,simplify reality in order to improve our understanding of it.

Correct AnswerverifiedShow Answer

Which two groups of decision makers are included in the simple circular-flow diagram?

Correct AnswerverifiedShow Answer

Figure 2-8 -Refer to Figure 2-8,Panel (a) .The movement from point M to point K could be caused by

Correct AnswerverifiedShow Answer

A duty of economists at the Department of Labor is to

Correct AnswerverifiedShow Answer

Figure 2-2 -Refer to Figure 2-2.If the owners of land,labor,and capital are represented by Box B of this circular-flow diagram,then

Correct AnswerverifiedShow Answer

Economists hold many positions advising the president and Congress including

Correct AnswerverifiedShow Answer

Which of the following is not correct about most economic models?

Correct AnswerverifiedShow Answer

Which of these statements about economic models is correct?

Correct AnswerverifiedShow Answer

Economists try to address their subject with a scientist's objectivity.

Correct AnswerverifiedShow Answer

Economists at the U.S.Department of the Treasury help design U.S.coins and paper money.

Correct AnswerverifiedShow Answer

Which of the following statements is correct?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 2-8 -Refer to Figure 2-8,Panel (a) .The opportunity cost of moving from point M to point L is

Correct AnswerverifiedShow Answer

Home is a country that produces two goods,pears and cellular phones.Last year,Home produced 450 bushels of pears and 1050 cellular phones.This year it produced 450 bushels of pears and 2000 cellular phones.Given no other information,which of the following events could explain this change?

Correct AnswerverifiedShow Answer

Policymaking in a representative democracy

Correct AnswerverifiedShow Answer

If an economy is producing efficiently,then

Correct AnswerverifiedShow Answer

In building economic models,economists often omit

Correct AnswerverifiedShow Answer

"If all economists were laid end to end,they would not reach a conclusion." Who made this whimsical observation?

Correct AnswerverifiedShow Answer

When an economy is operating inside its production possibilities frontier,we know that

Correct AnswerverifiedShow Answer

Which of these terms are used interchangeably?

Correct AnswerverifiedShow Answer

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