Exam 21: Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

The bigger the shortage for a good or service,the ____________ the seller of the good or service will or can be to an individual customer _________.(We are assuming here that the shortage cannot,for legal reasons,be alleviated through a rise in price. )

Identify and describe each step of the five-step process outlined in the text for building and testing theories.

Which of the following is false?

For every gift that A gives to B from the first to the tenth gift,A receives a net benefit of $10.The additional cost to A of giving an additional gift is constant at $5.It follows that A's marginal benefit curve for giving gifts to B is ___________________ (assuming that we place "marginal benefits" on the vertical axis and "number of gifts" on the horizontal axis).

There is no difference between building a theory and evaluating a theory.

Refer to Situation 33-1.If the prospective criminal sets the following values: Ps = 60 percent Loot = $10,000 Pp = 10 percent I = $20,000 F = $25,000 AC = $10,000 The prospective criminal's expected benefit from committing the burglary is ______________ and his expected cost of committing the burglary is _______________.Economic theory tells us that under these circumstances,the prospective criminal ______________ commit the burglary.

Refer to Situation 33-1.If the prospective criminal sets the following values: Ps = 75 percent Loot = $50,000 Pp = 20 percent I = $80,000 F = $35,000 AC = $5,000 The prospective criminal's expected benefit from committing the burglary is ______________ and his expected cost of committing the burglary is _______________.Economic theory tells us that under these circumstances,the prospective criminal ______________ commit the burglary.

Which of the following theories is not falsifiable or refutable?

The gap between the higher equilibrium tuition and lower student tuition is $4,000 at university A and $10,000 at university B.It follows that

In the burglary crime model presented in the text,as the anguish cost of committing a burglary rises,the prediction is that

Suppose you go to a high school and identify groups of students sitting at different lunch tables.To you it appears that everyone on the football team sits at one table,everyone who gets really high grades sits at another table,everyone who is in the drama club sits at another table,and so on.This outcome could be

In general,a dry cleaner in a small town is ______________ likely to be unethical in his business practices than a dry cleaner in a large city.This is because the larger a percentage of the population a person is,the _____________likely that person will have to further engage with people he initially meets.

There is a direct relationship between the opportunity cost of bad behavior in a public venue and the use of bad behavior in that venue.

If a theory can predict those things that you should observe if it is right and can also predict those things that you should observe if it is wrong,it is said to have the virtue of falsifiability.

The _________________ the opportunity cost of bad behavior,the _________________ likely one is to exhibit bad behavior.

A man moves from a large city to a small town.In the small town he seems like a very different person than the person he was in the big city.For instance,he is more polite in the small town than he was in the big city.This could be because

Theory A predicts that the higher the opportunity cost of having a child,the fewer children a woman will have.Which of the following is evidence against the theory if opportunity cost is measured in terms of foregone salary?

A person who lives in a good-climate city says,"It's expensive to live here,but at least the climate is free." In terms of a theory advanced in the text,this person has either forgotten or is unaware that

Anna gives Billy a gift of $200.We can be sure that Billy will

Smith sends her children to a private school on the other side of town.Tuition per student per year: $15,000.Jones sends her children to a public school on her side of town.Tuition per student per year: $0.Most people seem to think that the private school and public school are equivalent when it comes to educating students.According to a theory discussed in the text,