Question 1

"Society would be better off if the welfare system were abolished" is a normative statement, not a positive statement.

Accepted Answer

A) True 
 B)False

Question 2

In the circular-flow diagram,

Accepted Answer

A)  factors of production flow from government to firms.
B)  goods and services flow from households to firms.
C)  income paid to the factors of production flows from firms to households.
D)  spending on goods and services flows from firms to households.E) B) and D)
F) C) and D)

Question 3

An economic theory about international trade that is based on the assumption that there are only two countries trading two goods

Accepted Answer

A)  is useless, since the real world has many countries trading many goods.
B)  can be useful only in situations involving two countries and two goods.
C)  can be useful in the classroom, but is useless in the real world.
D)  can be useful in helping economists understand the complex world of international trade involving many countries and many goods.E) B) and C)
F) A) and D)

Question 4

When economists make positive statements, they are

Accepted Answer

A)  speaking as scientists.
B)  speaking as policy advisers.
C)  making claims about how the world should be.
D)  revealing that they are very conservative in their views of how the world works.E) C) and D)
F) B) and C)

Question 5

Figure 2-15
Relationship between Price and Cups of Coffee 
-Refer to Figure 2-15. In the ordered pair (4, 6)

Accepted Answer

A)  the x-coordinate is 4 and the y-coordinate is 6.
B)  the x-coordinate is 6 and the y-coordinate is 4.
C)  the numbers tell the location of the origin.
D)  the 4 represents the price and the 6 represents the number of cups of coffee.E) B) and D)
F) None of the above

Question 6

The second number in any ordered pair is

Accepted Answer

A)  the x-coordinate.
B)  the y-coordinate.
C)  the horizontal location of the point.
D)  the slope.E) A) and C)
F) B) and C)

Question 7

Use the following graph to answer the following questions.
a.How would point J be represented as an ordered pair?
b.What type of curve is this?
c.Does this curve show a positive or negative correlation between price and quantity?
d.Compute the slope of D1 between points J and L.
e.What is the slope of D1 between points L and N? Why would you not have to calculate this answer?
f. What is it called if we move from D1 to D2 ?
g. How do you know that the slope of D2 is the same as the slope of D1 ?

Accepted Answer

a.(20,24)
b.a demand curve
c.a negative ...

Question 8

In the circular-flow diagram, one loop represents the flow of goods and services, and the other loop represents the flow of factors of production.

Accepted Answer

A) True 
 B)False

Question 9

Figure 2-14 
-Refer to Figure 2-14. If this economy uses all its resources in the dishwasher industry, it produces 35 dishwashers and no doghouses.

Accepted Answer

A) True 
 B)False

Question 10

Almost all economists agree that rent control

Accepted Answer

A)  has no effect on the rental income of landlords.
B)  allows the market for housing to work more efficiently.
C)  adversely affects the availability and quality of housing.
D)  is a very inexpensive way to help the most needy members of society.E) None of the above
F) A) and D)

Question 11

When a variable that is not named on either axis of a graph changes, we read the change as a movement along the curve.

Accepted Answer

A) True 
 B)False

Question 12

Economic growth causes a production possibilities frontier to shift outward.

Accepted Answer

A) True 
 B)False

Question 13

Figure 2-14 
-Refer to Figure 2-14. The movement from point B to point C is a(n)

Accepted Answer

A)  shift of the demand curve.
B)  movement along the demand curve.
C)  indication that the price of grapes has changed.
D)  indication that the costs incurred by firms that produce grapes have changed.E) A) and B)
F) A) and C)

Question 14

Figure 2-15
Relationship between Price and Cups of Coffee 
-Refer to Figure 2-15. A movement from point A to point Z 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) A) and B)
F) C) and D)

Question 15

A survey which sought the opinion of professional economists on fourteen propositions about economic policy found that

Accepted Answer

A)  the respondents were almost equally divided on the propositions.
B)  the respondents favored the propositions by a slight margin.
C)  the respondents disagreed with the propositions by a slight margin.
D)  there was overwhelming endorsement of the propositions among the respondents.E) B) and D)
F) None of the above

Question 16

Figure 2-1 
-Refer to Figure 2-1. Sonia completes her first week of employment working as a hairdresser at a salon. On Friday of that week, she receives her first paycheck. To which of the arrows does this transaction directly contribute?

Accepted Answer

A)  B only
B)  A and B
C)  C only
D)  C and DE) B) and D)
F) None of the above

Question 17

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 D)
F) B) and C)

Question 18

Which of the following is an example of a normative, as opposed to positive, statement?

Accepted Answer

A)  The price of gasoline came down sharply during the second half of 2006.
B)  If the government were to set a maximum legal price on gasoline, then there would be a shortage of gasoline.
C)  Income taxes should be reduced.
D)  The federal government obtains much of its revenue from income taxes.E) A) and B)
F) B) and C)

Question 19

In the circular-flow diagram, firms produce

Accepted Answer

A)  goods and services using factors of production.
B)  output using inputs.
C)  factors of production using goods and services.
D)  Both (a)  and (b)  are correct.E) B) and C)
F) A) and C)

Question 20

In the simple circular-flow diagram, who consumes the goods and services that firms produce?

Accepted Answer

A)  households only
B)  firms only
C)  both households and firms
D)  neither households nor firmsE) None of the above
F) A) and B)

Exam 2: Thinking Like an Economist

When a variable that is not named on either axis of a graph changes, we read the change as a movement along the curve.

Correct Answer
verified

Figure 2-15 Relationship between Price and Cups of Coffee -Refer to Figure 2-15. A movement from point A to point Z is called

Correct Answer
verified

An economic theory about international trade that is based on the assumption that there are only two countries trading two goods

Correct Answer
verified

In the circular-flow diagram, firms produce

Correct Answer
verified

Which of the following is an example of a normative, as opposed to positive, statement?

Correct Answer
verified

"Society would be better off if the welfare system were abolished" is a normative statement, not a positive statement.

Correct Answer
verified

In the circular-flow diagram,

Correct Answer
verified

Correct Answer
verified
a.(20,24)
b.a demand curve
c.a negative ...
View Answer

Figure 2-1 -Refer to Figure 2-1. Sonia completes her first week of employment working as a hairdresser at a salon. On Friday of that week, she receives her first paycheck. To which of the arrows does this transaction directly contribute?

Correct Answer
verified

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

Correct Answer
verified

The second number in any ordered pair is

Correct Answer
verified

Figure 2-14 -Refer to Figure 2-14. The movement from point B to point C is a(n)

Correct Answer
verified

A survey which sought the opinion of professional economists on fourteen propositions about economic policy found that

Correct Answer
verified

In the simple circular-flow diagram, who consumes the goods and services that firms produce?

Correct Answer
verified

Figure 2-15 Relationship between Price and Cups of Coffee -Refer to Figure 2-15. In the ordered pair (4, 6)

Correct Answer
verified

Economic growth causes a production possibilities frontier to shift outward.

Correct Answer
verified

Almost all economists agree that rent control

Correct Answer
verified

When economists make positive statements, they are

Correct Answer
verified

Figure 2-14 -Refer to Figure 2-14. If this economy uses all its resources in the dishwasher industry, it produces 35 dishwashers and no doghouses.

Correct Answer
verified

In the circular-flow diagram, one loop represents the flow of goods and services, and the other loop represents the flow of factors of production.

Correct Answer
verified

Exam 2: Thinking Like an Economist

When a variable that is not named on either axis of a graph changes, we read the change as a movement along the curve.

Correct AnswerverifiedShow Answer

Figure 2-15 Relationship between Price and Cups of Coffee -Refer to Figure 2-15. A movement from point A to point Z is called

Correct AnswerverifiedShow Answer

An economic theory about international trade that is based on the assumption that there are only two countries trading two goods

Correct AnswerverifiedShow Answer

In the circular-flow diagram, firms produce

Correct AnswerverifiedShow Answer

Which of the following is an example of a normative, as opposed to positive, statement?

Correct AnswerverifiedShow Answer

"Society would be better off if the welfare system were abolished" is a normative statement, not a positive statement.

Correct AnswerverifiedShow Answer

In the circular-flow diagram,

Correct AnswerverifiedShow Answer

Correct Answerverifieda.(20,24)b.a demand curvec.a negative ...View AnswerShow Answer

Figure 2-1 -Refer to Figure 2-1. Sonia completes her first week of employment working as a hairdresser at a salon. On Friday of that week, she receives her first paycheck. To which of the arrows does this transaction directly contribute?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The second number in any ordered pair is

Correct AnswerverifiedShow Answer

Figure 2-14 -Refer to Figure 2-14. The movement from point B to point C is a(n)

Correct AnswerverifiedShow Answer

A survey which sought the opinion of professional economists on fourteen propositions about economic policy found that

Correct AnswerverifiedShow Answer

In the simple circular-flow diagram, who consumes the goods and services that firms produce?

Correct AnswerverifiedShow Answer

Figure 2-15 Relationship between Price and Cups of Coffee -Refer to Figure 2-15. In the ordered pair (4, 6)

Correct AnswerverifiedShow Answer

Economic growth causes a production possibilities frontier to shift outward.

Correct AnswerverifiedShow Answer

Almost all economists agree that rent control

Correct AnswerverifiedShow Answer

When economists make positive statements, they are

Correct AnswerverifiedShow Answer

Figure 2-14 -Refer to Figure 2-14. If this economy uses all its resources in the dishwasher industry, it produces 35 dishwashers and no doghouses.

Correct AnswerverifiedShow Answer

In the circular-flow diagram, one loop represents the flow of goods and services, and the other loop represents the flow of factors of production.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
a.(20,24)
b.a demand curve
c.a negative ...
View Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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