Question 1

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.

Question 2

Differences in scientific judgement between economists are similar to all of the following except

Accepted Answer

A)   astronomers debating whether the sun or earth was at the center of the solar system.
B)   meteorologists debating the existence of global warming.
C)   two politicians arguing about the fairness of the tax code.
D)   explorers debating whether or not the earth was flat before the time of Christopher Columbus.

Question 3

The nation's antitrust laws are enforced by economists at the Department of

Accepted Answer

A)   Labor.
B)   Health and Human Services.
C)   Justice.
D)   Treasury.

Question 4

Congress relies on economists at the Congressional Budget Office to

Accepted Answer

A)   enforce the nation's antitrust laws.
B)   set the nation's monetary policy.
C)   provide evidence that incumbent members of Congress are performing well in their jobs.
D)   provide independent evaluations of policy proposals.

Question 5

With respect to how economists study the economy, which of the following statements is most accurate?

Accepted Answer

A)   Economists study the past, but they do not try to predict the future.
B)   Economists use "rules of thumb" to predict the future.
C)   Economists devise theories, collect data, and analyze the data to test the theories.
D)   Economists use controlled experiments in much the same way that biologists and physicists do.

Question 6

Use the following Figure to answer the question : Figure 2-6 
-Refer to Figure 2-6. If this economy devotes all of its resources to the production of blankets, then it will produce

Accepted Answer

A)   0 blankets and 360 pillows.
B)   200 blankets and 240 pillows.
C)   320 blankets and 120 pillows.
D)   360 blankets and 0 pillows.

Question 7

Economists face an obstacle that many other scientists do not face. What is that obstacle?

Accepted Answer

A)   It is often difficult to formulate theories in economics.
B)   It is often impractical to perform experiments in economics.
C)   Economics cannot be addressed objectively; it must be addressed subjectively.
D)   The scientific method cannot be applied to the study of economics.

Question 8

Which of the following is not an example of a natural experiment an economist might use to evaluate a theory?

Accepted Answer

A)   Transit ridership increased in Atlanta following an increase in gas prices.
B)   Federal tax revenue increased following a decrease in the tax rate.
C)   Students in a principles of microeconomics course are asked to play a game with classmates to determine what decisions they make under certain circumstances.
D)   Following the imposition of austerity measures, the growth rate of the economy in Greece slowed.

Question 9

The effects of borrowing by the federal government would be studied by a microeconomist rather than a macroeconomist.

Accepted Answer

A) True 
 B)False

Question 10

Economists use some familiar terms in specialized ways

Accepted Answer

A)   to make the subject sound more complex than it is.
B)   because every respectable field of study has its own language.
C)   to provide a new and useful way of thinking about the world.
D)   because it was too difficult to come up with new terms.

Question 11

In the simple circular flow diagram, the flow of money from the firms to the markets for factors of production is called

Accepted Answer

A)   spending.
B)   revenue.
C)   income.
D)   wages, rent, and profit.

Question 12

Use the following Figure to answer the question : Figure 2-17 
-Refer to Figure 2-17. The movement from point A to point B is an)

Accepted Answer

A)   shift of the demand curve.
B)   indication of a change in preferences for grapes.
C)   movement along the demand curve.
D)   indication of an increase in income.

Question 13

When two variables move in the same direction, the curve relating them is downward sloping, and we say the variables are negatively related.

Accepted Answer

A) True 
 B)False

Question 14

The circular-flow diagram explains, in general terms, how the economy is organized and how participants in the economy interact with one another.

Accepted Answer

A) True 
 B)False

Question 15

Different values are not a reason for disagreement among economists.

Accepted Answer

A) True 
 B)False

Question 16

Economists who are primarily responsible for advising Congress on economic matters work in which agency?

Accepted Answer

A)   the Federal Reserve
B)   the Congressional Budget Office
C)   the Department of the Treasury
D)   the Department of Commerce

Question 17

Is the following a positive or normative statement? The Federal Reserve should set an inflation target and employ policies to meet the target.

Accepted Answer

The answer of Is the following a positive or normative...

Question 18

In the simple circular-flow diagram, households

Accepted Answer

A)   are the only decision makers.
B)   own the factors of production.
C)   are buyers of inputs.
D)   consume only some of the goods and services that firms produce.

Question 19

Use the following Figure to answer the question : Figure 2-17 
-Refer to Figure 2-17. The curves shown are

Accepted Answer

A)   supply curves.
B)   demand curves.
C)   preference curves.
D)   income-consumption curves.

Question 20

A relatively steep demand curve indicates that

Accepted Answer

A)   quantity demanded will adjust only slightly to a price change.
B)   quantity demanded will adjust significantly to a price change.
C)   quantity demanded will not adjust to a price change.
D)   the change in quantity demanded will exactly equal a change in price.

Exam 2: Thinking Like an Economist

Economists face an obstacle that many other scientists do not face. What is that obstacle?

Correct AnswerverifiedShow Answer

Economists hold many positions advising the president and Congress including

Correct AnswerverifiedShow Answer

Economists use some familiar terms in specialized ways

Correct AnswerverifiedShow Answer

In the simple circular-flow diagram, households

Correct AnswerverifiedShow Answer

When two variables move in the same direction, the curve relating them is downward sloping, and we say the variables are negatively related.

Correct AnswerverifiedShow Answer

In the simple circular flow diagram, the flow of money from the firms to the markets for factors of production is called

Correct AnswerverifiedShow Answer

Congress relies on economists at the Congressional Budget Office to

Correct AnswerverifiedShow Answer

A relatively steep demand curve indicates that

Correct AnswerverifiedShow Answer

Is the following a positive or normative statement? The Federal Reserve should set an inflation target and employ policies to meet the target.

Correct AnswerverifiedShow Answer

Economists who are primarily responsible for advising Congress on economic matters work in which agency?

Correct AnswerverifiedShow Answer

Use the following Figure to answer the question : Figure 2-17 -Refer to Figure 2-17. The movement from point A to point B is an)

Correct AnswerverifiedShow Answer

Which of the following is not an example of a natural experiment an economist might use to evaluate a theory?

Correct AnswerverifiedShow Answer

Use the following Figure to answer the question : Figure 2-6 -Refer to Figure 2-6. If this economy devotes all of its resources to the production of blankets, then it will produce

Correct AnswerverifiedShow Answer

The nation's antitrust laws are enforced by economists at the Department of

Correct AnswerverifiedShow Answer

Different values are not a reason for disagreement among economists.

Correct AnswerverifiedShow Answer

The effects of borrowing by the federal government would be studied by a microeconomist rather than a macroeconomist.

Correct AnswerverifiedShow Answer

Differences in scientific judgement between economists are similar to all of the following except

Correct AnswerverifiedShow Answer

With respect to how economists study the economy, which of the following statements is most accurate?

Correct AnswerverifiedShow Answer

Use the following Figure to answer the question : Figure 2-17 -Refer to Figure 2-17. The curves shown are

Correct AnswerverifiedShow Answer

The circular-flow diagram explains, in general terms, how the economy is organized and how participants in the economy interact with one another.

Correct AnswerverifiedShow 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

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified