Question 1

A model that shows how dollars flow through markets among households and firms is called the

Accepted Answer

A)  production possibilities frontier.
B)  circular-flow diagram.
C)  demand and supply diagram.
D)  comparative advantage model.E) B) and D)
F) B) and C)

Question 2

In conducting their research,economists face an obstacle that not all scientists face;specifically,in economics,it is often impractical to

Accepted Answer

A)  make use of theory and observation.
B)  rely upon the scientific method.
C)  conduct laboratory experiments.
D)  find articles or books that were written before 1900.E) A) and B)
F) None of the above

Question 3

Unemployment would cause an economy to

Accepted Answer

A)  produce inside its production possibilities frontier.
B)  produce on its production possibilities frontier.
C)  produce outside its production possibilities frontier.
D)  experience an inward shift of its production possibilities frontier.E) None of the above
F) A) and D)

Question 4

A model can be accurately described as a

Accepted Answer

A)  theoretical abstraction with very little value.
B)  device that is useful only to the people who created it.
C)  realistic and carefully constructed theory.
D)  simplification of reality.E) A) and B)
F) A) and C)

Question 5

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.E) A) and C)
F) A) and D)

Question 6

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

Accepted Answer

A)  goods
B)  services
C)  capital
D)  profitE) None of the above
F) A) and B)

Question 7

Figure 2-10

-Refer to Figure 2-10,Panel (a) .Production at point Y is

Accepted Answer

A)  impossible and inefficient.
B)  impossible but efficient.
C)  possible but inefficient.
D)  possible and efficient.E) A) and B)
F) B) and D)

Question 8

Another term for factors of production is

Accepted Answer

A)  inputs.
B)  output.
C)  goods.
D)  services.E) All of the above
F) None of the above

Question 9

Among economic models,the circular-flow diagram is unusual in that it

Accepted Answer

A)  drastically simplifies the real world.
B)  features more than one type of market.
C)  features flows of dollars.
D)  does not involve mathematics.E) B) and C)
F) C) and D)

Question 10

According to the circular-flow diagram,if Denny is the owner of a landscaping business and he just received $50 for mowing Mrs.Pendleton's lawn,

Accepted Answer

A)  the $50 represents a cost of production for Denny's firm.
B)  the $50 represents wages,rent,and profit to Denny's firm.
C)  Denny acts as a firm who interacted in the markets for factors of production with Mrs.Pendleton.
D)  Denny acts as a firm who interacted in the markets for goods and services with Mrs.Pendleton.E) A) and B)
F) A) and C)

Question 11

Figure 2-7 
-Refer to Figure 2-7.Unemployment could cause this economy to produce at which point(s) ?

Accepted Answer

A)  L,M
B)  N,O,P,Q
C)  N,O,P
D)  QE) All of the above
F) A) and D)

Question 12

Figure 2-6 
-Refer to Figure 2-6.If this economy moves from point F to point G,then which of the following statements is correct?

Accepted Answer

A)  This economy has moved from a point of inefficient production to a point of efficient production.
B)  This economy has experienced economic growth.
C)  This economy has experienced an increase in employment.
D)  None of the above is correct.E) A) and C)
F) A) and B)

Question 13

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

Accepted Answer

A)  goods and services
B)  dollars paid to land,labor,and capital
C)  dollars spent on goods and services
D)  wages,rent,and profitE) B) and C)
F) A) and D)

Question 14

Economic models

Accepted Answer

A)  are people who act out the behavior of firms and households so that economists can study this behavior.
B)  are usually detailed replications of reality.
C)  incorporate simplifying assumptions that often contradict reality,but also help economists better understand reality.
D)  are useful to researchers but not to teachers because economic models omit many details of the real-world economy.E) A) and D)
F) B) and C)

Question 15

Figure 2-1 
-Refer to Figure 2-1.Which arrow represents the flow of income payments?

Accepted Answer

A)  A
B)  B
C)  C
D)  DE) A) and B)
F) C) and D)

Question 16

The circular-flow diagram

Accepted Answer

A)  is an economic model.
B)  incorporates two types of decision makers: households and firms.
C)  represents the flows of inputs,outputs,and dollars.
D)  All of the above are correct.E) B) and D)
F) None of the above

Question 17

Figure 2-3 
-Refer to Figure 2-3.Which of the following is an activity undertaken by the actors in rectangle 2?

Accepted Answer

A)  produce and sell goods and services
B)  hire and use factors of production
C)  own and sell factors of production
D)  exchange goods and services between firms and householdsE) B) and C)
F) All of the above

Question 18

Refer to Figure 2-13.Which of the following statements is true about point G for this economy?

Accepted Answer

A)  Point G is currently unattainable.
B)  Point G is efficient.
C)  At point G,more cakes are produced than cookies.
D)  There is unemployment at point G.E) B) and C)
F) A) and D)

Question 19

Figure 2-2 
-Refer to Figure 2-2.Carla regularly buys fruits and vegetables at a grocery store.Roberto regularly pays a lawn-care company to mow his lawn.If the flow of fruits and vegetables from the grocery store to Carla is represented by an arrow from Box C to Box B of this circular-flow diagram,then the money paid by Roberto to the lawn-care company is represented by an arrow

Accepted Answer

A)  from Box A to Box D.
B)  from Box B to Box C.
C)  from Box C to Box B.
D)  from Box D to Box A.E) None of the above
F) C) and D)

Question 20

Figure 2-5 
-Refer to Figure 2-5.The opportunity cost of obtaining 40 additional dryers by moving from point D to point C is

Accepted Answer

A)  0 washers.
B)  20 washers.
C)  40 washers.
D)  None of the above;the economy cannot move from point D to point C.E) A) and D)
F) None of the above

Exam 2: Thinking Like an Economist: The Economist As Scientist

Figure 2-3 -Refer to Figure 2-3.Which of the following is an activity undertaken by the actors in rectangle 2?

Correct Answer
verified

Figure 2-6 -Refer to Figure 2-6.If this economy moves from point F to point G,then which of the following statements is correct?

Correct Answer
verified

A model can be accurately described as a

Correct Answer
verified

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

Correct Answer
verified

Refer to Figure 2-13.Which of the following statements is true about point G for this economy?

Correct Answer
verified

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

Correct Answer
verified

Unemployment would cause an economy to

Correct Answer
verified

Figure 2-10 -Refer to Figure 2-10,Panel (a) .Production at point Y is

Correct Answer
verified

A model that shows how dollars flow through markets among households and firms is called the

Correct Answer
verified

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

Correct Answer
verified

Among economic models,the circular-flow diagram is unusual in that it

Correct Answer
verified

Economic models

Correct Answer
verified

Figure 2-1 -Refer to Figure 2-1.Which arrow represents the flow of income payments?

Correct Answer
verified

In conducting their research,economists face an obstacle that not all scientists face;specifically,in economics,it is often impractical to

Correct Answer
verified

Figure 2-7 -Refer to Figure 2-7.Unemployment could cause this economy to produce at which point(s) ?

Correct Answer
verified

Figure 2-5 -Refer to Figure 2-5.The opportunity cost of obtaining 40 additional dryers by moving from point D to point C is

Correct Answer
verified

Correct Answer
verified

According to the circular-flow diagram,if Denny is the owner of a landscaping business and he just received $50 for mowing Mrs.Pendleton's lawn,

Correct Answer
verified

Another term for factors of production is

Correct Answer
verified

The circular-flow diagram

Correct Answer
verified

Exam 2: Thinking Like an Economist: The Economist As Scientist

Figure 2-3 -Refer to Figure 2-3.Which of the following is an activity undertaken by the actors in rectangle 2?

Correct AnswerverifiedShow Answer

Figure 2-6 -Refer to Figure 2-6.If this economy moves from point F to point G,then which of the following statements is correct?

Correct AnswerverifiedShow Answer

A model can be accurately described as a

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Refer to Figure 2-13.Which of the following statements is true about point G for this economy?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Unemployment would cause an economy to

Correct AnswerverifiedShow Answer

Figure 2-10 -Refer to Figure 2-10,Panel (a) .Production at point Y is

Correct AnswerverifiedShow Answer

A model that shows how dollars flow through markets among households and firms is called the

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

Among economic models,the circular-flow diagram is unusual in that it

Correct AnswerverifiedShow Answer

Economic models

Correct AnswerverifiedShow Answer

Figure 2-1 -Refer to Figure 2-1.Which arrow represents the flow of income payments?

Correct AnswerverifiedShow Answer

In conducting their research,economists face an obstacle that not all scientists face;specifically,in economics,it is often impractical to

Correct AnswerverifiedShow Answer

Figure 2-7 -Refer to Figure 2-7.Unemployment could cause this economy to produce at which point(s) ?

Correct AnswerverifiedShow Answer

Figure 2-5 -Refer to Figure 2-5.The opportunity cost of obtaining 40 additional dryers by moving from point D to point C is

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

According to the circular-flow diagram,if Denny is the owner of a landscaping business and he just received $50 for mowing Mrs.Pendleton's lawn,

Correct AnswerverifiedShow Answer

Another term for factors of production is

Correct AnswerverifiedShow Answer

The circular-flow diagram

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