Question 1

Economists disagree on most economic issues facing an economy.

Accepted Answer

A) True 
 B)False

Question 2

The slope of a downward-sloping straight line can be calculated as the distance from the

Accepted Answer

A)   horizontal intercept of the line to the origin divided by the distance from the origin to the vertical intercept of the line.
B)   origin to the horizontal intercept of the line minus the distance from the origin to the vertical intercept of the line.
C)   vertical intercept of the line to the origin divided by the distance from the origin to the horizontal intercept of the line.
D)   vertical intercept of the line to the origin minus the distance from the origin to the horizontal intercept of the line.

Question 3

Lower inflation rates are usually correlated with lower unemployment rates.

Accepted Answer

A) True 
 B)False

Question 4

The steepness of a curve is partially determined by the units of measurement.

Accepted Answer

A) True 
 B)False

Question 5

The 1981 tax reform act reduced taxes on high-income individuals.Many economists believed that high tax rates would deter high-income individuals from working and investing, thus slowing the growth of income.This illustrates the issue of

Accepted Answer

A)   the equality-efficiency trade-off.
B)   usury.
C)   the effects of budget deficits on future generations.
D)   the cost disease of the public sector.
E)   the importance of externalities.

Question 6

Why do economists abstract, and is it appropriate?

Accepted Answer

Economists (and other scientists) abstra...

Question 7

Harry Truman is credited with the statement, "Give me a one-armed economist," because economists are likely to say, "On the one hand, ...on the other hand." Why do economists "waffle" more than physicists or chemists?

Accepted Answer

Economists describe human behavior, whic...

Question 8

During a war, a government will often draft people, most of whom are presently employed, into the army.An economist, computing the real cost of the war, would be sure to include which of the following items?

Accepted Answer

A)   the value of the civilian goods no longer produced by the new soldiers
B)   the cost of feeding and clothing the new soldiers
C)   the dollar cost of the payroll
D)   the higher prices of civilian goods due to wartime shortages
E)   the cost of transporting the soldiers to combat

Question 9

Which of the following is an example of an externality?

Accepted Answer

A)   Drug abuse affecting David's health.
B)   Sara taking a break from work.
C)   A transaction between two parties, affecting them alone.
D)   Tom's smoking affecting his roommate's health.

Question 10

It is possible to represent three dimensions on a two-dimensional graph by using

Accepted Answer

A)   a contour map.
B)   a razor blade.
C)   curved lines.
D)   all of the above.

Question 11

"The hotter it gets, the more water people drink." This statement implies that the relationship between temperature and water consumption must have a

Accepted Answer

A)   negative slope.
B)   positive slope.
C)   slope always equal to one.
D)   slope always equal to 45 degrees.

Question 12

A graph's origin is the point of intersection of all lines or curves in the graph.

Accepted Answer

A) True 
 B)False

Question 13

Economic models

Accepted Answer

A)   are always based on realistic assumptions.
B)   usually predict perfectly.
C)   can never be tested with real world data.
D)   are used to describe cause-and-effect relationships.
E)   are too simple to be of much use.

Question 14

Economic theory is necessary and extremely important because of its relationship to economic policy.

Accepted Answer

A) True 
 B)False

Question 15

The slope of a curved line at a particular point is

Accepted Answer

A)   always greater than the slope of a straight line at the same point.
B)   always smaller than the slope of a straight line at the same point.
C)   defined as the slope of the straight line representing the average values for the entire curve.
D)   defined as the slope of the straight line that is tangent to the curve at that point.

Question 16

Is it possible to express an economic model in words without diagrams?

Accepted Answer

A)   No, models can only be stated in diagrams.
B)   No, the very definition of model requires mathematical form.
C)   Yes, some of the simplest models are verbal statements.
D)   Yes, although the best models always use diagrams.
E)   Uncertain, economic theory has not answered this question yet.

Question 17

The government uses fiscal and monetary policy to mitigate the effects of economic fluctuations.

Accepted Answer

A) True 
 B)False

Question 18

Slope will vary along a curve (as opposed to a straight line).

Accepted Answer

A) True 
 B)False

Question 19

An economic model can be defined as

Accepted Answer

A)   a testable claim which can be evaluated with proper data.
B)   a representation of a theory or a part of a theory.
C)   another word for theory.
D)   a method to distinguish correlation from causation.
E)   All of the above are correct.

Question 20

If a government enacts a rent control to protect apartment tenants, the result is likely going to be

Accepted Answer

A)   an increase in rents with a surplus of apartments.
B)   an increase in rents with a shortage of apartments.
C)   a decrease in rents with a surplus of apartments.
D)   a decrease in rents with a shortage of apartments.

Exam 1: What Is Economics?

It is possible to represent three dimensions on a two-dimensional graph by using

Correct AnswerverifiedShow Answer

"The hotter it gets, the more water people drink." This statement implies that the relationship between temperature and water consumption must have a

Correct AnswerverifiedShow Answer

During a war, a government will often draft people, most of whom are presently employed, into the army.An economist, computing the real cost of the war, would be sure to include which of the following items?

Correct AnswerverifiedShow Answer

The government uses fiscal and monetary policy to mitigate the effects of economic fluctuations.

Correct AnswerverifiedShow Answer

The slope of a curved line at a particular point is

Correct AnswerverifiedShow Answer

An economic model can be defined as

Correct AnswerverifiedShow Answer

The 1981 tax reform act reduced taxes on high-income individuals.Many economists believed that high tax rates would deter high-income individuals from working and investing, thus slowing the growth of income.This illustrates the issue of

Correct AnswerverifiedShow Answer

Is it possible to express an economic model in words without diagrams?

Correct AnswerverifiedShow Answer

Economists disagree on most economic issues facing an economy.

Correct AnswerverifiedShow Answer

Economic theory is necessary and extremely important because of its relationship to economic policy.

Correct AnswerverifiedShow Answer

A graph's origin is the point of intersection of all lines or curves in the graph.

Correct AnswerverifiedShow Answer

Which of the following is an example of an externality?

Correct AnswerverifiedShow Answer

If a government enacts a rent control to protect apartment tenants, the result is likely going to be

Correct AnswerverifiedShow Answer

Lower inflation rates are usually correlated with lower unemployment rates.

Correct AnswerverifiedShow Answer

The slope of a downward-sloping straight line can be calculated as the distance from the

Correct AnswerverifiedShow Answer

Why do economists abstract, and is it appropriate?

Correct AnswerverifiedEconomists (and other scientists) abstra...View AnswerShow Answer

The steepness of a curve is partially determined by the units of measurement.

Correct AnswerverifiedShow Answer

Harry Truman is credited with the statement, "Give me a one-armed economist," because economists are likely to say, "On the one hand, ...on the other hand." Why do economists "waffle" more than physicists or chemists?

Correct AnswerverifiedEconomists describe human behavior, whic...View AnswerShow Answer

Slope will vary along a curve (as opposed to a straight line).

Correct AnswerverifiedShow Answer

Economic models

Correct AnswerverifiedShow Answer

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Economists (and other scientists) abstra...
View Answer

Correct Answer
verified

Correct Answer
verified
Economists describe human behavior, whic...
View Answer

Correct Answer
verified

Correct Answer
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