Exam 1: The Art and Science of Economic Analysis

A good theory seeks to:

Economists believe that people respond in a predictable way to changes in costs and benefits. The term that best describes this phenomenon is:

College graduates with history or literature as their major tend to earn more than those who choose more quantitative disciplines like economics.

The assumption of rational self-interest means that economic decision makers:

Most economists consider a theory a good one if it predicts well.

The basic purpose of economic models is to:

The difference between a good and a service is that:

Economic theory:

Which of the following is an accurate list, in order, of the steps of the scientific method?

"There should be less discrimination against the elderly." This is an example of a:

Normative economic statements refer to what should be.

An economic model that sometimes makes incorrect predictions may be used by economic decision makers:

A good or service is considered scarce if:

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

The problem of scarce resources:

Rational economic decision makers will make a change only if:

Alicia makes the statement that every time she eats chocolate, she gets acne. By ignoring the possibility that there may be another factor that causes Alicia to eat chocolate and which also causes her acne, Alicia is committing the:

Economists believe that individuals respond in a predictable way to changes in costs and benefits. The term that best describes this belief is:

As a scientist, an economist's main professional objective is to become wealthy.

A hypothesis is: