Exam 1: Introducing the Economic Way of Thinking

Graphically express a direct and an inverse or negative relationship. What could cause a shift in a line or curve expressing a relationship between two variables?

Exhibit 1A-5 Straight line -As shown in Exhibit 1A-5, the slope of straight line CD:

The perpetual state of insufficiency of resources to satisfy people's unlimited wants is:

Normative economics is:

Economic models are of limited use since they cannot be tested empirically with actual data.

Exhibit 1A-10 Multi-curve graph -Exhibit 1A-10 represents a three-variable relationship. As the annual income of consumers rises from $20,000 (line A) to $40,000 (line B), the result is a:

The most fundamental concepts underlying the discipline of economics are:

A line that has a different slope at each point is a:

Which of the following is not a resource? ​

​Assume there is a relationship between two variables and the other-variables-held constant assumption (ceteris paribus) is relaxed. We would expect that the line representing this relationship would:

Which of the following is a positive statement?

Economics is the study of people making choices faced with the problem of unlimited wants and limited resources.

Economics is the study of how people:

Which of the following is an example of a normative economic statement?

The finite nature of the economy's resource base:

Exhibit 1A-3 Straight line -As shown in Exhibit 1A-3, the slope of straight line AB:

Abstracting from reality is an important element of all economic models.

The perpetual problem of scarcity forcing people to make choices is the basis for the definition of economics.

Which of the following is the best example of a normative economic statement?

Determining the price of compact discs is a concern of: