Question 1

Figure 2-13
 
-Refer to Figure 2-13. Cups of coffee per day and the hours that someone can go without sleep appear to have

Accepted Answer

A)   a positive correlation.
B)   a negative correlation.
C)   a random correlation.
D)   no correlation.E) None of the above
F) A) and C)

Question 2

Figure 2-13
 
-Refer to Figure 2-13. The graph shown is known as a

Accepted Answer

A)   time-series graph.
B)   bar graph.
C)   scatterplot.
D)   pie chart.E) C) and D)
F) B) and C)

Question 3

The argument that purchases of minivans cause large families is an example of

Accepted Answer

A)   omitted variables.
B)   normative statements.
C)   reverse causality.
D)   bias.E) All of the above
F) A) and D)

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

The scientific method is applicable to studying

Accepted Answer

A)   natural sciences, but not social sciences.
B)   social sciences, but not natural sciences.
C)   both natural sciences and social sciences.
D)   None of the above is correct.E) None of the above
F) A) and B)

Question 6

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

Question 7

Figure 2-6
 
-Refer to Figure 2-6. What is the opportunity cost of moving from point A to point B?

Accepted Answer

A)   zero
B)   6 clocks
C)   6 clocks and 15 candles
D)   15 candlesE) A) and C)
F) None of the above

Question 8

Which of the following statements best captures the relationship between microeconomics and macroeconomics?

Accepted Answer

A)   For the most part, microeconomists are unconcerned with macroeconomics, and macroeconomists are unconcerned with microeconomics.
B)   Microeconomists study markets for small products, whereas macroeconomists study markets for large products.
C)   Microeconomics and macroeconomics are distinct from one another, yet they are closely related.
D)   Microeconomics is oriented toward policy studies, whereas macroeconomics is oriented toward theoretical studies.E) A) and B)
F) B) and C)

Question 9

Deciding that A causes B when in fact B causes A is a mistake called omitted variable bias.

Accepted Answer

A) True 
 B)False

Question 10

In the circular-flow diagram, another name for goods and services produced by firms is

Accepted Answer

A)   factors of production.
B)   output.
C)   inputs.
D)   resources.E) B) and C)
F) A) and D)

Question 11

A demand curve displaying the relationship between the price of cars and the quantity demanded of cars should have a slope that is

Accepted Answer

A)   less than 0.
B)   between zero and 1.
C)   between one and infinity.
D)   undefined.E) A) and D)
F) All of the above

Question 12

Microeconomics is the study of how households and firms make decisions and how they interact in specific markets.

Accepted Answer

A) True 
 B)False

Question 13

Because it is difficult for economists to use experiments to generate data, they generally must

Accepted Answer

A)   do without data.
B)   substitute assumptions for data when data are unavailable.
C)   rely upon hypothetical data that were previously concocted by other economists.
D)   use whatever data the world gives them.E) All of the above
F) A) and D)

Question 14

When studying the effects of public policy changes, economists

Accepted Answer

A)   always refrain from making assumptions.
B)   sometimes make different assumptions about the short run and the long run.
C)   consider only the direct effects of those policy changes and not the indirect effects.
D)   consider only the short-run effects of those policy changes and not the long-run effects.E) A) and C)
F) C) and D)

Question 15

Larry Summers, a chief economic adviser to President Obama, stated that as a result of using Keynesian policies in 2008 and 2009,

Accepted Answer

A)   US government policy moved in a strongly activist direction.
B)   the US has shifted from worrying about an economic depression to thinking about what kind of expansion the country will have.
C)   the US has shifted from rescuing the economy to economic recovery.
D)   All of the above are correct.E) B) and D)
F) A) and B)

Question 16

Positive statements are

Accepted Answer

A)   prescriptive.
B)   claims about how the world should be.
C)   claims about how the world is.
D)   made by economists speaking as policy advisers.E) B) and D)
F) C) and D)

Question 17

Economists often find it worthwhile to make assumptions that do not necessarily describe the real world.

Accepted Answer

A) True 
 B)False

Question 18

Figure 2-15
Relationship between Price and Cups of Coffee
 
-Refer to Figure 2-15. Which of the following could result in a movement from point A to point B?

Accepted Answer

A)   a change in income
B)   a change in preferences
C)   a change in the price of coffee
D)   a change in the price of teaE) All of the above
F) C) and D)

Question 19

Just like models constructed in other areas of science, economic models

Accepted Answer

A)   incorporate assumptions that contradict reality.
B)   incorporate all details of the real world.
C)   complicate reality.
D)   avoid the use of diagrams and equations.E) None of the above
F) B) and D)

Question 20

Historical episodes allow economists to illustrate and evaluate current economic theories.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist

Economists often find it worthwhile to make assumptions that do not necessarily describe the real world.

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Figure 2-15 Relationship between Price and Cups of Coffee -Refer to Figure 2-15. Which of the following could result in a movement from point A to point B?

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Which of the following statements best captures the relationship between microeconomics and macroeconomics?

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A demand curve displaying the relationship between the price of cars and the quantity demanded of cars should have a slope that is

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In the circular-flow diagram, another name for goods and services produced by firms is

Correct AnswerverifiedShow Answer

Figure 2-13 -Refer to Figure 2-13. The graph shown is known as a

Correct AnswerverifiedShow Answer

The scientific method is applicable to studying

Correct AnswerverifiedShow Answer

Because it is difficult for economists to use experiments to generate data, they generally must

Correct AnswerverifiedShow Answer

Larry Summers, a chief economic adviser to President Obama, stated that as a result of using Keynesian policies in 2008 and 2009,

Correct AnswerverifiedShow Answer

Positive statements are

Correct AnswerverifiedShow Answer

A statement describing how the world is

Correct AnswerverifiedShow Answer

When studying the effects of public policy changes, economists

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Historical episodes allow economists to illustrate and evaluate current economic theories.

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The argument that purchases of minivans cause large families is an example of

Correct AnswerverifiedShow Answer

Figure 2-6 -Refer to Figure 2-6. What is the opportunity cost of moving from point A to point B?

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Deciding that A causes B when in fact B causes A is a mistake called omitted variable bias.

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Microeconomics is the study of how households and firms make decisions and how they interact in specific markets.

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

Correct AnswerverifiedShow Answer

Figure 2-13 -Refer to Figure 2-13. Cups of coffee per day and the hours that someone can go without sleep appear to have

Correct AnswerverifiedShow Answer

Just like models constructed in other areas of science, economic models

Correct AnswerverifiedShow Answer

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