Question 1

Economists sometimes give conflicting advice because

Accepted Answer

A)  graduate students in economics are encouraged to argue with each other.
B)  economists have different values and scientific judgment.
C)  economists acting as scientists do not like to agree with economists acting as policy advisers.
D)  economics is more of a belief system than a science.E) A) and D)
F) B) and C)

Question 2

Figure 2-16​ 
-Refer to Figure 2-16. It is not possible for this economy to produce at point

Accepted Answer

A)  A.
B)  B.
C)  C.
D)  D.E) B) and C)
F) None of the above

Question 3

When two variables move in opposite directions, the curve relating them is

Accepted Answer

A)  upward sloping, and we say the variables are positively related.
B)  upward sloping, and we say the variables are negatively related.
C)  downward sloping, and we say the variables are positively related.
D)  downward sloping, and we say the variables are negatively related.E) B) and C)
F) A) and B)

Question 4

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) None of the above

Question 5

Figure 2-3 
-Refer to Figure 2-3. Which of the following is an activity undertaken by the actors in rectangle 2?

Accepted Answer

A)  produce and sell goods and services
B)  hire and use factors of production
C)  own and sell factors of production
D)  exchange goods and services between firms and householdsE) B) and D)
F) B) and C)

Question 6

Figure 2-18
Relationship between Price and Restaurant Meals 
-Refer to Figure 2-18. The slope of the line containing points A and B is

Accepted Answer

A)  -1/2.
B)  -2.
C)  1/2.
D)  2.E) A) and D)
F) B) and D)

Question 7

Figure 2-8 
-Refer to Figure 2-8. For this economy, as more and more hammers are produced, the opportunity cost of an additional hammer produced, in terms of nails,

Accepted Answer

A)  remains constant.
B)  increases.
C)  decreases.
D)  This answer cannot be determined from the graph.E) B) and D)
F) A) and C)

Question 8

As a substitute for laboratory experiments, economists use evidence available through history's

Accepted Answer

natural ex...

Question 9

Suppose an economist develops a theory that higher food prices arise from higher gas prices. According to the scientific method, which of the following is the economist's next step?

Accepted Answer

A)  Collect and analyze data.
B)  Go to a laboratory and generate data to test the theory.
C)  Publish the theory without testing it.
D)  Consult with other economists to see they agree with the theory.E) None of the above
F) A) and B)

Question 10

Figure 2-13 
-Refer to Figure 2-13. Which of the following statements is true about point G for this economy?

Accepted Answer

A)  Point G is currently unattainable.
B)  Point G is efficient.
C)  At point G, more cakes are produced than cookies.
D)  There is unemployment at point G.E) B) and D)
F) B) and C)

Question 11

Figure 2-4 
-Refer to Figure 2-4. This economy has the ability to produce at which point(s) ?

Accepted Answer

A)  Q, R, T, U
B)  R, T, U
C)  R, U
D)  TE) A) and B)
F) All of the above

Question 12

Figure 2-18
Relationship between Price and Restaurant Meals 
-Refer to Figure 2-18. A movement from point A to point B is called

Accepted Answer

A)  a shift in demand.
B)  a movement along the demand curve.
C)  a shift in supply.
D)  a movement along the supply curve.E) All of the above
F) C) and D)

Question 13

Figure 2-15 
-Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. When society moves from point A to point B,

Accepted Answer

A)  the opportunity cost is the same as when society moves from point B to point C.
B)  it is giving up cars to get sofas.
C)  the opportunity cost is increasing.
D)  it moves from an inefficient point to an efficient point.E) A) and D)
F) A) and C)

Question 14

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 15

A positive economic statement such as "Pollution taxes decrease the quantity of pollution firms generate"

Accepted Answer

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

Question 16

Suppose a nation is currently producing at a point inside its production possibilities frontier. We know that

Accepted Answer

A)  the nation is producing beyond its capacity, so inflation will occur.
B)  the nation is not using all available resources or is using inferior technology or both.
C)  the nation is producing an efficient combination of goods.
D)  there will be a large opportunity cost if the nation tries to increase production of any good.E) B) and D)
F) A) and B)

Question 17

Figure 2-9
Panel (a) 
Panel (b)   
-Refer to Figure 2-9, 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 C)
F) A) and D)

Question 18

The slope of a line that passes through the points (5, 8)  and (12, 12)  is

Accepted Answer

A)  -7/4.
B)  -4/7.
C)  4/7.
D)  7/4.E) A) and B)
F) All of the above

Question 19

The trade-off between the production of one good and the production of another good can change over time because of technological advances.

Accepted Answer

A) True 
 B)False

Question 20

What you must give up to get something else is called the

Accepted Answer

The answer of What you must give up to get...

Exam 2: Thinking Like an Economist

If an economy is producing efficiently, then

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As a substitute for laboratory experiments, economists use evidence available through history's

Correct Answerverifiednatural ex...View AnswerShow Answer

Figure 2-3 -Refer to Figure 2-3. Which of the following is an activity undertaken by the actors in rectangle 2?

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Suppose a nation is currently producing at a point inside its production possibilities frontier. We know that

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What you must give up to get something else is called the

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The trade-off between the production of one good and the production of another good can change over time because of technological advances.

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A positive economic statement such as "Pollution taxes decrease the quantity of pollution firms generate"

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Economists sometimes give conflicting advice because

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Figure 2-9 Panel (a) Panel (b) -Refer to Figure 2-9, 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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Figure 2-13 -Refer to Figure 2-13. Which of the following statements is true about point G for this economy?

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Figure 2-18 Relationship between Price and Restaurant Meals -Refer to Figure 2-18. The slope of the line containing points A and B is

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Figure 2-8 -Refer to Figure 2-8. For this economy, as more and more hammers are produced, the opportunity cost of an additional hammer produced, in terms of nails,

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Figure 2-4 -Refer to Figure 2-4. This economy has the ability to produce at which point(s) ?

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The slope of a line that passes through the points (5, 8) and (12, 12) is

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Figure 2-16​ -Refer to Figure 2-16. It is not possible for this economy to produce at point

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Figure 2-15 -Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. When society moves from point A to point B,

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When two variables move in opposite directions, the curve relating them is

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Suppose an economist develops a theory that higher food prices arise from higher gas prices. According to the scientific method, which of the following is the economist's next step?

Correct AnswerverifiedShow Answer

Figure 2-18 Relationship between Price and Restaurant Meals -Refer to Figure 2-18. A movement from point A to point B is called

Correct AnswerverifiedShow Answer

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

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Figure 2-16 -Refer to Figure 2-16. It is not possible for this economy to produce at point

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