Question 1

Use the following Table to answer the question : Table 2-6

-Refer to Table 2-6. Consider the production possibilities table for an economy that produces only mobile phones and pizzas. What is the opportunity cost of increasing production of mobile phones from 200 to 500?

Accepted Answer

The answer of Use the following Table to answer the...

Question 2

Points on the production possibilities frontier represent efficient levels of production.

Accepted Answer

A) True 
 B)False

Question 3

Use the following Figure to answer the question : Figure 2-23 : 
-Refer to Figure 2-23. It is possible for this economy to produce 45 doghouses and 30 dishwashers.

Accepted Answer

A) True 
 B)False

Question 4

Use the following Figure to answer the question : Figure 2-7 
-Refer to Figure 2-7. Efficient production is represented by which points) ?

Accepted Answer

A)   L, M
B)   L, M, N, P, Q
C)   N, O, P
D)   QE) A) and B)
F) B) and C)

Question 5

Use the following Figure to answer the question Figure: 2-2 
-Refer to Figure 2-2. If households are buyers in the markets represented by Box C of this circular-flow diagram, then

Accepted Answer

A)   Box C must represent the markets for the factors of production.
B)   Box D must represent the markets for goods and services.
C)   firms are sellers in the markets represented by Box C.
D)   All of the above are correct.E) A) and C)
F) B) and C)

Question 6

The following table contains some production possibilities for an economy for a given year: Table 2-2

Refer to Table 2-2. If the production possibilities frontier is bowed outward, then "?" could be

Accepted Answer

A)   6000.
B)   5500.
C)   5000.
D)   4500.E) All of the above
F) B) and C)

Question 7

Use the following Figure to answer the question Figure: 2-2 
-Refer to Figure 2-2. Boxes C and D of this circular-flow diagram represent

Accepted Answer

A)   households and government.
B)   firms and government.
C)   the markets for goods and services and the markets for financial assets.
D)   the markets for goods and services and the markets for factors of production.E) B) and D)
F) None of the above

Question 8

Use the following Figure to answer the question : Figure 2-8 :

-Refer to Figure 2-8. Efficient production is represented by which points?

Accepted Answer

A)   J
B)   J, K
C)   J, K, L
D)   J, K, ME) A) and B)
F) None of the above

Question 9

You know an economist has crossed the line from policy adviser to scientist when he or she

Accepted Answer

A)   claims that the problem at hand is widely misunderstood by non-economists.
B)   makes positive statements.
C)   talks about values.
D)   makes a claim about how the world should be.E) A) and B)
F) None of the above

Question 10

Figure 2-10
Panel a) 
 
Panel b)

-Refer to Figure 2-10, Panel a)  and Panel b) . A shift of the economy's production possibilities frontier from Panel a)  to Panel b)  could be caused by

Accepted Answer

A)   unemployment.
B)   an improvement in sofa production technology.
C)   an improvement in tractor production technology.
D)   an improvement in both sofa and tractor production technology.E) B) and C)
F) A) and C)

Question 11

A statement describing how the world should be

Accepted Answer

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

Question 12

Which of the following concepts cannot be illustrated by the production possibilities frontier?

Accepted Answer

A)   efficiency
B)   opportunity cost
C)   equality
D)   trade-offsE) B) and C)
F) A) and B)

Question 13

Use the following Figure to answer the question : Figure 2-5:  
-Refer to Figure 2-5. Suppose this economy is producing at point D. Which of the following statements would best explain this situation?

Accepted Answer

A)   The economy has insufficient resources to produce at a more desirable point.
B)   The economy's available technology prevents it from producing at a more desirable point.
C)   There is widespread unemployment in the economy.
D)   Any of the above statements would be a legitimate explanation for this situation.E) A) and B)
F) None of the above

Question 14

Economists speaking like policy advisers make

Accepted Answer

A)   claims about how the world is.
B)   descriptive statements.
C)   normative statements.
D)   More than one of the above is correct.E) A) and C)
F) A) and D)

Question 15

Normative conclusions

Accepted Answer

A)   come from positive analysis alone.
B)   are based on ignorance of positive analysis.
C)   involve value judgments.
D)   reflect the economist's role as scientist.E) All of the above
F) A) and B)

Question 16

In the circular flow diagram, when Daphne purchases a new mobile phone, she participates in the markets for

Accepted Answer

The answer of In the circular flow diagram, when Daphne...

Question 17

An outcome is said to be efficient if an economy is getting all it can from the scarce resources it has available.

Accepted Answer

A) True 
 B)False

Question 18

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 C)
F) A) and C)

Question 19

Two variables that have a negative correlation move in opposite directions.

Accepted Answer

A) True 
 B)False

Question 20

In the circular-flow diagram, which of the following items flows from households to firms through the markets for the factors of production?

Accepted Answer

A)   goods and services
B)   land, labor, and capital
C)   dollars spent on goods and services
D)   wages, rent, and profitE) A) and B)
F) None of the above

Exam 2: Thinking Like an Economist

Use the following Table to answer the question : Table 2-6 -Refer to Table 2-6. Consider the production possibilities table for an economy that produces only mobile phones and pizzas. What is the opportunity cost of increasing production of mobile phones from 200 to 500?

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Points on the production possibilities frontier represent efficient levels of production.

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Use the following Figure to answer the question Figure: 2-2 -Refer to Figure 2-2. Boxes C and D of this circular-flow diagram represent

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You know an economist has crossed the line from policy adviser to scientist when he or she

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Use the following Figure to answer the question Figure: 2-2 -Refer to Figure 2-2. If households are buyers in the markets represented by Box C of this circular-flow diagram, then

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A statement describing how the world should be

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Use the following Figure to answer the question : Figure 2-7 -Refer to Figure 2-7. Efficient production is represented by which points) ?

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An outcome is said to be efficient if an economy is getting all it can from the scarce resources it has available.

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In the circular flow diagram, when Daphne purchases a new mobile phone, she participates in the markets for

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Normative conclusions

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Use the following Figure to answer the question : Figure 2-23 : -Refer to Figure 2-23. It is possible for this economy to produce 45 doghouses and 30 dishwashers.

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Use the following Figure to answer the question : Figure 2-5: -Refer to Figure 2-5. Suppose this economy is producing at point D. Which of the following statements would best explain this situation?

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Figure 2-10 Panel a) Panel b) -Refer to Figure 2-10, Panel a) and Panel b) . A shift of the economy's production possibilities frontier from Panel a) to Panel b) could be caused by

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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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Which of the following concepts cannot be illustrated by the production possibilities frontier?

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In the circular-flow diagram, which of the following items flows from households to firms through the markets for the factors of production?

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Two variables that have a negative correlation move in opposite directions.

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Use the following Figure to answer the question : Figure 2-8 : -Refer to Figure 2-8. Efficient production is represented by which points?

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The following table contains some production possibilities for an economy for a given year: Table 2-2 Refer to Table 2-2. If the production possibilities frontier is bowed outward, then "?" could be

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Economists speaking like policy advisers make

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