Question 1

Figure 2-4 
-Refer to Figure 2-4. Efficient production is represented by which point(s) ?

Accepted Answer

A)  Q, R, U
B)  R, T, U
C)  R, U
D)  S, TE) B) and D)
F) B) and C)

Question 2

Figure 2-18
Relationship between Price and Restaurant Meals 
-Refer to Figure 2-18. 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) All of the above
F) B) and C)

Question 3

Figure 2-15 
-Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of one sofa is

Accepted Answer

The answer of Figure 2-15 
-Refer to Figure 2-15. Consider...

Question 4

In the circular-flow diagram, which of the following items flows from firms to households 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) A) and C)

Question 5

The outer loop of the circular-flow diagram represents the flows of dollars in the economy. Which of the following does not appear on the outer loop?

Accepted Answer

A)  wages
B)  income
C)  capital
D)  rentE) None of the above
F) A) and B)

Question 6

The slope of a line is equal to

Accepted Answer

A)  the change in the value of x divided by the change in the value of y.
B)  the change in the value of y divided by the change in the value of x.
C)  the horizontal distance divided by the vertical distance.
D)  the value of y divided by the value of x.E) C) and D)
F) A) and B)

Question 7

Figure 2-16 
-Refer to Figure 2-16. Taking cause and effect into account, which of the following interpretations would be most reasonable regarding the relationship between coffee and hours without sleep?

Accepted Answer

A)  The less coffee a person drinks per day, the more time he can go without sleep.
B)  There is no relationship between how much coffee per day a person drinks and how long he can go without sleep.
C)  The more coffee a person drinks per day, the more time he can go without sleep.
D)  The more coffee a person drinks per day, the less time he can go without sleep.E) A) and C)
F) All of the above

Question 8

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 9

The y-coordinate is the

Accepted Answer

A)  first number of an ordered pair and represents the point's horizontal location.
B)  second number of an ordered pair and represents the point's horizontal location.
C)  first number of an ordered pair and represents the point's vertical location.
D)  second number of an ordered pair and represents the point's vertical location.E) A) and B)
F) A) and C)

Question 10

How did the influential economist John Maynard Keynes explain his remark that though economics is an easy subject compared with the higher branches of philosophy or pure science, it is a subject at which few excel?

Accepted Answer

A)  Most people who study economics are not very bright.
B)  Good economists must possess a rare combination of gifts.
C)  Economics is quite boring; hence, people tend to lose interest in it before mastering it.
D)  Good thinkers become frustrated with economics because it does not make use of the scientific method.E) A) and C)
F) B) and D)

Question 11

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 12

Production possibilities frontiers are usually bowed outward. This is because

Accepted Answer

A)  the more resources a society uses to produce one good, the fewer resources it has available to produce another good.
B)  the opportunity cost of producing a good decreases as more and more of that good is produced.
C)  of the effects of technological change.
D)  resources are specialized; that is, some are better at producing particular goods rather than other goods.E) A) and B)
F) B) and C)

Question 13

Table 2-4
Production Possibilities for Picnicland 
-Refer to Table 2-4. What is the opportunity cost to Picnicland of increasing the production of hotdogs from 450 to 900?

Accepted Answer

A)  150 burgers
B)  225 burgers
C)  300 burgers
D)  450 burgersE) A) and B)
F) None of the above

Question 14

Figure 2-4 
-Refer to Figure 2-4. At which point is this economy producing its maximum possible quantity of doors?

Accepted Answer

A)  R
B)  S
C)  T
D)  UE) A) and D)
F) A) and C)

Question 15

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 16

In the circular-flow diagram, which of the following items does not flow from households to firms?

Accepted Answer

A)  revenue
B)  land, labor, and capital
C)  factors of production
D)  profitE) A) and B)
F) None of the above

Question 17

According to the circular-flow diagram, if Suzy is a worker who delivers flowers for Happy Day Flower Company, she participates

Accepted Answer

A)  in the markets for factors of production exchanging labor for income.
B)  in the markets for factors of production exchanging flowers for revenue.
C)  in the markets for goods and services exchanging flowers for wages, rent, and profit.
D)  in the markets for goods and services exchanging labor for income.E) B) and D)
F) All of the above

Question 18

Figure 2-14 
-Refer to Figure 2-14. It is possible for this economy to produce 30 doghouses and 20 dishwashers.

Accepted Answer

A) True 
 B)False

Question 19

Figure 2-3 
-Refer to Figure 2-3. What is the name of the model depicted in the figure?

Accepted Answer

The answer of Figure 2-3 
-Refer to Figure 2-3. What...

Question 20

Normative statements describe how the world is, while positive statements prescribe how the world should be.

Accepted Answer

A) True 
 B)False

Exam 2: Thinking Like an Economist

The outer loop of the circular-flow diagram represents the flows of dollars in the economy. Which of the following does not appear on the outer loop?

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Table 2-4 Production Possibilities for Picnicland -Refer to Table 2-4. What is the opportunity cost to Picnicland of increasing the production of hotdogs from 450 to 900?

Correct AnswerverifiedShow Answer

Figure 2-15 -Refer to Figure 2-15. Consider the production possibilities frontier for an economy that produces only sofas and cars. The opportunity cost of one sofa is

Correct AnswerverifiedShow Answer

How did the influential economist John Maynard Keynes explain his remark that though economics is an easy subject compared with the higher branches of philosophy or pure science, it is a subject at which few excel?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Normative statements describe how the world is, while positive statements prescribe how the world should be.

Correct AnswerverifiedShow Answer

In the circular-flow diagram, which of the following items does not flow from households to firms?

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Production possibilities frontiers are usually bowed outward. This is because

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Figure 2-4 -Refer to Figure 2-4. Efficient production is represented by which point(s) ?

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Figure 2-4 -Refer to Figure 2-4. At which point is this economy producing its maximum possible quantity of doors?

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Figure 2-14 -Refer to Figure 2-14. It is possible for this economy to produce 30 doghouses and 20 dishwashers.

Correct AnswerverifiedShow Answer

The slope of a line is equal to

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The y-coordinate is the

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 2-16 -Refer to Figure 2-16. Taking cause and effect into account, which of the following interpretations would be most reasonable regarding the relationship between coffee and hours without sleep?

Correct AnswerverifiedShow Answer

Figure 2-3 -Refer to Figure 2-3. What is the name of the model depicted in the figure?

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According to the circular-flow diagram, if Suzy is a worker who delivers flowers for Happy Day Flower Company, she participates

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