Question 1

Table 2-4
Production Possibilities for Batterland
 
-Refer to Table 2-4.What is the opportunity cost to Batterland of increasing the production of pancakes from 150 to 300?

Accepted Answer

A)   75 waffles
B)   150 waffles
C)   250 waffles
D)   325 wafflesE) A) and B)
F) B) and D)

Question 2

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

Accepted Answer

A)   is asked to explain the cause of an economic event.
B)   is asked to recommend a policy to improve economic outcomes.
C)   is asked as a policy adviser.
D)   does not have enough information to respond.E) A) and B)
F) B) and C)

Question 3

In the past,environmentalists thought of economics as a method of maximizing profits.Presently,

Accepted Answer

A)   there is now realization that economics offers a framework for natural resource allocation.
B)   economists are helping to formulate the intellectual framework behind approaches to protecting endangered species,reducing pollution,and preventing climate change.
C)   economics informs environmental studies but economists still do not work for environmental advocacy groups.
D)   More than one of the above is correct.E) B) and D)
F) B) and C)

Question 4

In a certain economy,jam and bread are produced,and the economy currently operates on its production possibilities frontier.Which of the following events would allow the economy to produce more jam and more bread,relative to the quantities of those goods that are being produced now?

Accepted Answer

A)   Unemployed labor is put to work producing jam and bread.
B)   The economy puts its idle capital to work producing jam and bread.
C)   The economy experiences economic growth.
D)   All of the above are correct.E) None of the above
F) B) and C)

Question 5

Figure 2-17
Relationship Between Years of Education and Annual Income 
-Refer to Figure 2-17.The graph above is a

Accepted Answer

A)   bar graph
B)   scatterplot
C)   pie chart
D)   time series analysisE) None of the above
F) A) and B)

Question 6

Efficiency is illustrated by

Accepted Answer

A)   both the production possibilities frontier and the circular-flow diagram.
B)   neither the production possibilities frontier nor the circular-flow diagram.
C)   the production possibilities frontier only.
D)   the circular-flow diagram only.E) C) and D)
F) B) and C)

Question 7

Economists make assumptions in order to

Accepted Answer

A)   mimic the methodologies employed by other scientists.
B)   minimize the number of experiments that yield no useful data.
C)   minimize the likelihood that some aspect of the problem at hand is being overlooked.
D)   focus their thinking on the essence of the problem at hand.E) A) and C)
F) A) and B)

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

If new government regulations designed to protect wetlands remove very productive farmland from production,then the production possibilities frontier will shift inward.

Accepted Answer

A) True 
 B)False

Question 10

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

Accepted Answer

A)   drastically simplifies the real world.
B)   features more than one type of market.
C)   features flows of dollars.
D)   does not involve mathematics.E) B) and D)
F) All of the above

Question 11

For economists,historical episodes

Accepted Answer

A)   are not worthy of study because they offer few insights into current economic events and problems.
B)   are not worthy of study because laboratory experiments provide more reliable data.
C)   are worthy of study because economists rely entirely on observation,rather than on theory.
D)   are worthy of study because they serve as valuable substitutes for laboratory experiments.E) A) and B)
F) A) and C)

Question 12

A statement describing how the world is

Accepted Answer

A)   is a normative statement.
B)   is a positive statement.
C)   would only be made by an economist speaking as a policy adviser.
D)   would only be made by an economist employed by the government.E) B) and C)
F) C) and D)

Question 13

A normative economic statement such as "The minimum wage should be abolished"

Accepted Answer

A)   would likely be made by an economist acting as a scientist.
B)   would require values and data in order to be evaluated.
C)   would require data but not values in order to be evaluated.
D)   could not be evaluated by economists acting as policy advisers.E) C) and D)
F) None of the above

Question 14

The art in scientific thinking is

Accepted Answer

A)   finding the right problem to study.
B)   deciding which assumptions to make.
C)   the ability to make an abstract subject easy to understand.
D)   not something in which economists have to be skilled.E) A) and B)
F) All of the above

Question 15

Figure 2-7 
-Refer to Figure 2-7.Efficient production is represented by which point(s) ?

Accepted Answer

A)   J
B)   J,K
C)   J,K,L
D)   J,K,ME) A) and C)
F) B) and C)

Question 16

Evaluating normative statements involves values as well as facts.

Accepted Answer

A) True 
 B)False

Question 17

The x-coordinate of an ordered pair specifies the

Accepted Answer

A)   diagonal location of the point.
B)   vertical location of the point.
C)   horizontal location of the point.
D)   quadrant location in which the point is located.E) A) and B)
F) A) and C)

Question 18

Figure 2-10 
-Refer to Figure 2-10.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.E) B) and C)
F) A) and D)

Question 19

One difference between a hypothetical benevolent king implementing the best policy and the president implementing the best policy in the real world is the president has to be concerned about

Accepted Answer

A)   any misunderstandings in communicating the policy to the public.
B)   whether the policy will affect his standing among different groups in the electorate.
C)   what amendments will be suggested by members of Congress.
D)   All of the above are correct.E) A) and C)
F) A) and B)

Question 20

Figure 2-8
 
-Refer to Figure 2-8,Panel (a) and Panel (b) .Which of the following is not a result of the shift of the economy's production possibilities frontier from Panel (a) to Panel (b) ?

Accepted Answer

A)   the tradeoff between the production of donuts and coffee changes
B)   the opportunity cost of a cup of coffee is higher at all levels of coffee production
C)   production of 4 donuts and 2 cups of coffee becomes possible
D)   production of 1 donut and 4 cups of coffee becomes efficientE) B) and D)
F) All of the above

Exam 2: Thinking Like an Economist

The x-coordinate of an ordered pair specifies the

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Figure 2-8 -Refer to Figure 2-8,Panel (a) and Panel (b) .Which of the following is not a result of the shift of the economy's production possibilities frontier from Panel (a) to Panel (b) ?

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

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In a certain economy,jam and bread are produced,and the economy currently operates on its production possibilities frontier.Which of the following events would allow the economy to produce more jam and more bread,relative to the quantities of those goods that are being produced now?

Correct AnswerverifiedShow Answer

Table 2-4 Production Possibilities for Batterland -Refer to Table 2-4.What is the opportunity cost to Batterland of increasing the production of pancakes from 150 to 300?

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Economists make assumptions in order to

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

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For economists,historical episodes

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A normative economic statement such as "The minimum wage should be abolished"

Correct AnswerverifiedShow Answer

In the past,environmentalists thought of economics as a method of maximizing profits.Presently,

Correct AnswerverifiedShow Answer

One difference between a hypothetical benevolent king implementing the best policy and the president implementing the best policy in the real world is the president has to be concerned about

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Evaluating normative statements involves values as well as facts.

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Figure 2-17 Relationship Between Years of Education and Annual Income -Refer to Figure 2-17.The graph above is a

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If new government regulations designed to protect wetlands remove very productive farmland from production,then the production possibilities frontier will shift inward.

Correct AnswerverifiedShow Answer

Figure 2-7 -Refer to Figure 2-7.Efficient production is represented by which point(s) ?

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Figure 2-10 -Refer to Figure 2-10.Which of the following events would explain the shift of the production possibilities frontier from A to B?

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

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Efficiency is illustrated by

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The art in scientific thinking is

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A statement describing how the world is

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