Question The process of critical thinking i

08 Jun Question The process of critical thinking i

Question
The process of critical thinking is useful in macroeconomics because…

macroeconomics is hard.
macroeconomics focuses on choosing effective policies.
macroeconomics deals with people.
macroeconomics involves statistics.
Flag this Question Question 21 pts
Economics is defined in the textbook as the study of…

how people manage their resources to meet their needs and enhance their well-being.
profit maximization by private enterprises.
inflation, unemployment and taxation.
how households, businesses and governments attain wealth.
free markets.
Flag this Question Question 31 pts
Macroeconomics emphasizes the economic activities and interactions of individuals and particular organizations.

True
False
Flag this Question Question 41 pts
The four essential economic activities are…

production, consumption, distribution, and recycling.
extraction, manufacturing, distribution, and consumption.
extraction, consumption, distribution, and resource maintenance.
production, consumption, distribution, and resource maintenance.
production, distribution, recycling, and resource maintenance.
Flag this Question Question 51 pts
According to the text, the three major macroeconomic goals are…

good living standards, stability and security, and sustainability.
low inflation, low unemployment, and economic growth.
economic growth, stability and security, and good living standards.
low inflation, low unemployment, and well-being.
economic growth, well-being, and good living standards.
Flag this Question Question 61 pts

The chart above shows that, from 1960 to 2010, global economic production per capita increased by a factor of about…

1.25
2.5
5
10
20
Flag this Question Question 71 pts
Keynesian economics originated during what historical period?

The American Revolution
The Industrial Revolution
The American Civil War
The Great Depression
World War II
Flag this Question Question 81 pts
Basic living standards issues relate to the quality of people’s…

diets.
housing.
access to transportation and communication.
medical attention.
All of the above
Flag this Question Question 91 pts
The term “well-being” refers to the broad goal of promoting the sustenance and flourishing of life.

True
False
Flag this Question Question 101 pts
Labor productivity measures…

the marginal product of labor.
output per hour of work.
economic growth.
per capita GDP.
None of the above
Flag this Question Question 111 pts
Which one of the following is not a macroeconomic question?

Was the Federal Reserve right to try to stimulate the economy by reducing interest rates?
How much will the California drought drive up the price of fresh vegetables?
Would the nation’s growth rate increase if marijuana were legalized in all 50 states?
How often has the country experienced a recession since World War II?
Flag this Question Question 121 pts
How are the question “Does innovation lead to economic growth?” and the question “Should government encourage innovation?” related?

Both questions are positive questions.
Both questions are normative questions.
The first question is a positive one; the second question is a normative one.
The first question is a normative one; the second question a positive one.
Flag this Question Question 131 pts
The common term for a side effect of a market transaction that affects those not involved in the transaction is…

a free rider.
an externality.
an implicit contract.
an internality.
a transaction cost.
Flag this Question Question 141 pts
A circular-flow diagram is a model of…

business cycles.
economic growth.
supply and demand.
the price and quantity of goods.
payments from firms to households and vice versa.
Flag this Question Question 151 pts
A key challenge to the empirical investigation of the macroeconomy is that…

there is little data available to researchers.
correlation does not imply causation.
inverse relationships are more common than direct relationships.
there are too many economic theories.
positive relationships between variables are rare.
Flag this Question Question 161 pts
Market failures can result from…

externalities.
public goods.
market power.
inequality.
All of the above
Flag this Question Question 171 pts
Which one of the following is an example of natural capital?

A playground
A factory
Your knowledge of economics
The trust you have in other people
The oil reserves in Alaska
Flag this Question Question 181 pts
What is the difference between a stock and a flow?

A flow is always measured before a stock.
A stock is always greater in quantity than a flow.
A flow is measured over time while a stock is measured at a point in time.
A stock is measured over a longer time period than a flow.
A flow is always greater in quantity than a stock.
Flag this Question Question 191 pts
Which one of the following statements is true?

Net investment is normally larger than gross investment.
The final use of a good or service is referred to as production.
A sustainable socioeconomic system seeks to maintain capital stocks.
One of the ways production is accomplished is through in-kind transfers.
A flow will always increase the value of a stock.
Flag this Question Question 201 pts
A tax system that taxes higher-income individuals at higher rates is called…

regressive.
progressive.
means-tested.
proportional.
in-kind.
Flag this Question Question 211 pts
This question refers to the following income distribution diagram.

In the above graph illustrating the income distribution in a particular society, the Gini ratio would be calculated using which of the following formulas?

B / (A + B)
A / B
B – A
A / (A + B)
A – B
Flag this Question Question 221 pts
Which one of the following countries has the highest Gini ratio?

Canada
Germany
Japan
Sweden
United States
Flag this Question Question 231 pts
Which one of the following statements best describes the time trend of U.S. income inequality over the last several decades?

Income inequality has been steadily increasing since the late 1940s.
Income inequality has been steadily decreasing since the late 1940s.
Income inequality generally decreased until the late 1960s, and since then it has been generally increasing.
Income inequality generally increased until the late 1960s, and since then it has been generally decreasing.
Income inequality has remained relatively constant since the late 1940s.
Flag this Question Question 241 pts
Which one of the following is not part of the primary-sector?

Agriculture
Commercial fishing
Mining
Timber industry
Petroleum refining
Flag this Question Question 251 pts
The question below refers to the following supply and demand diagram for wind turbines.

In the above supply and demand diagram for wind turbines, the initial supply curve is S0, the initial demand curve is D0, and the initial equilibrium is E0. Then assume a technology is invented which decreases the production costs for wind turbines. Which point is most likely to be the new equilibrium for wind turbines?

Point A
Point B
Point C
Point D
The equilibrium will stay at E0.
Flag this Question Question 261 pts
The buying and selling of assets on the expectation of profiting from price changes is known as…

complementarity.
speculation.
disequilibrium.
depreciation.
regulation.
Flag this Question Question 271 pts
Which one of the following is not an example of a positive frame or reference?

Efficiency
Microeconomics
Psychology
Business Sciences
Flag this Question Question 281 pts
Which one of the following is a reason economists use mathematics?

To clarify economic concepts
To work out the implications of an economic argument
As a way of summarizing economic thinking
All of the above
Flag this Question Question 291 pts
What is the distinction between cross-sectional data and time-series data?

Cross-sectional data is only used in microeconomics while time-series data is only used in macroeconomics.
Cross-sectional data provides information about economic behavior at an instant in time, while time-series data provides information about how an economic variable behaves over time.
Cross-sectional data provides information about one section of the economy, while time-series data provides information about the entire economy.
Cross-sectional data can be presented in tables, while time-series data requires the use of graphs.
Flag this Question Question 301 pts
Which is not one of the Five Steps to Effective Communication?

Be professional but lively.
Make your conclusion your main point.
Assume your audience disagrees with you.
Choose a suitable organization for your writing or speaking.
Flag this Question Question 311 pts

Using the graph above, suppose that society chooses to produce 100 pounds of butter. How many guns could it produce?

4
5
7
9
50
Flag this Question Question 321 pts
An analytical tool that highlights some aspects of reality while ignoring others is called…

a model.
empirical investigation.
historical investigation.
an institution.
a market.
Flag this Question Question 331 pts
Which one of the following is not an institutional requirement of markets?

Physical infrastructure
Corporations
Money
Private property
Trust
Flag this Question Question 341 pts
Analyzing time series data is a type of empirical investigation.

True
False
Flag this Question Question 351 pts
The value of the next best alternative that is foregone when a choice is made is called…

an opportunity cost.
an efficiency cost.
a scarcity cost.
an abundance cost.
a tradeoff cost.
Flag this Question Question 361 pts
Which one of the following is a limitation of idealized free markets?

Public goods cannot be provided well by markets.
Some market activities create externalities.
In the real world, many firms have market power.
Markets do not ensure that people can meet their basic human needs.
All of the above
Flag this Question Question 371 pts
A direct relationship implies that increases in one variable are associated with increases in the other variable.

True
False
Flag this Question Question 381 pts
Scarcity means that resources are not sufficient to allow all goals to be accomplished at once.

True
False
Flag this Question Question 391 pts
Technological progress can expand a society’s production possibilities frontier.

True
False
Flag this Question Question 401 pts
The only solution to a market failure is government intervention.

True
False
Flag this Question Question 411 pts
Which one of the following is an example of human capital?

A playground
A factory
Your knowledge of economics
The trust you have in other people
The oil reserves in Alaska
Flag this Question Question 421 pts
Increasing the quantity or quality of a resource is known as…

growth.
investment.
production.
exchange.
None of the above
Flag this Question Question 431 pts
The stock of capital increases through investment and decreases through…

consumption.
saving.
transfers.
waste.
depreciation.
Flag this Question Question 441 pts
If there is limited substitutability between resources, then…

it is impossible to design a sustainable socioeconomic system.
manufactured capital is an alternative to natural capital.
the exhaustion of nonrenewable resources poses a serious dilemma.
rates of depreciation will tend to be low.
renewable resources do not need to be carefully managed.
Flag this Question Question 451 pts
The conversion of resources into goods and services is known as…

production.
investment.
resource maintenance.
consumption.
depreciation.
Flag this Question Question 461 pts
Many of the controversies in macroeconomics arise from differences in opinion concerning…

whether free entry and exit are necessary for a competitive markets.
whether macroeconomic models should simplify reality.
whether real world markets approximate the model of perfectly-competitive and self-correcting markets.
whether demand plays an important role in determining the price and quantity of goods.
None of the above
Flag this Question Question 471 pts

In the graph above, which one of the following could explain the shift in the supply curve?

A decrease in the price of pizza
A decline in the number of pizzerias
An increased demand for pizza
A decrease in the price of hamburgers
A decrease in the price of labor
Flag this Question Question 481 pts
In the neoclassical supply and demand model, any disequilibrium is restored by instantaneous changes in the price. What are some of the factors in the real world that account for slow price adjustments, if any?

Sellers adjust to quantities rather than prices
Menu costs
Lengthy production processes
Information problems
All of the above
Flag this Question Question 491 pts
Laptop computers and computer software are examples of complementary goods.

True
False
Flag this Question Question 501 pts
Classical macroeconomists tend to be suspicious of self-correcting markets.