Question 1

To an economist, it is preferable to

Accepted Answer

A)  assume that all criminals are rational.
B)  assume that all criminals are irrational.
C)  build a theory based on a rational criminal and then check the evidence.
D)  assume that all suspected criminals are innocent. C

Question 2

Theory B predicts that everything that happens, happens for a reason - although we may not know what the reason is.  This theory

Accepted Answer

A)  can be refuted.
B)  probably cannot be refuted.
C)  is a good explanation for what happens.
D)  is the kind of theory that scientists like to build because it can explain so much. B

Question 3

Smith drives his car numerous places.  Sometimes he drives his car around his residential neighborhood and sometimes he drives it on the highway.  Occasionally, Smith gets peeved with the way other people drive and makes a rude gesture to them.  Based on one of the theories discussed in the textbook, he is

Accepted Answer

A)  more likely to make a rude gesture to another driver on the highway than in his residential neighborhood.
B)  less likely to make a rude gesture to another driver on the highway than in his residential neighborhood.
C)  equally likely to make a rude gesture to another driver on the highway as in the residential neighborhood.
D)  There is not enough information provided to answer this question. A

Question 4

Which of the following is not a prediction of the theory on baseball caps and cheating?

Accepted Answer

A)  More people will wear baseball caps on test days than on lecture days.
B)  More people will wear baseball caps for multiple choice tests than for essay tests.
C)  More people will wear baseball caps when students sit close to each other in class and are taking a test than when students sit far apart from each other and are taking a test.
D)  Baseball caps are more likely to be worn backwards (than frontwards) on test days than on lecture days.

Question 5

A theory predicts that all swans are white.  A thousand people go out into the field and identify the color of the swans they see.  Their results reveal that, of the 10,000 swans they saw, all were white.  It follows that

Accepted Answer

A)  the swan theory is a falsifiable theory.
B)  the swan theory is correct.
C)  the evidence fails to reject the swan theory.
D)  the evidence definitely makes the swan theory valid.

Question 6

A person tends to be ______________ likely to lose her temper with a boss than with a friend because the opportunity cost of losing her temper with her boss tends to be _____________ than the opportunity cost of losing her temper with her friend.

Accepted Answer

A)  less; higher
B)  more; higher
C)  less; lower
D)  more; lower

Question 7

Universities A and B are substitutes in the minds of many college students.  Initially the student tuition at each university is the same and far below the equilibrium tuition.  Then, the tuition at A is raised and B is not.  As a result of a rising tuition at A, some students who would have applied and enrolled in A, apply to B instead.  Based on the logic presented in one of the theories discussed in the textbook, we would expect that

Accepted Answer

A)  instructors at B will not change their habits when it comes to being punctual for office hours.
B)  instructors at A will begin to be more nearly punctual for office hours than they were previously.
C)  instructors at B will begin to be more nearly punctual for office hours than they were previously.
D)  instructors at A will not change their habits when it comes to being punctual for office hours.

Question 8

Economists often evaluate a theory in terms of how consistently and accurately it predicts what happens.  Implicit in this position is the belief that

Accepted Answer

A)  if the theory's predictions are consistently accurate, then there is a fairly good chance that the theory is a good explanation of how things work.
B)  if the theory's predictions are consistently imaccurate, then there is a fairly good chance that the theory will be accepted by others.
C)  if the theory's predictions are consistently inaccurate, then there is a fairly good chance that  the theory's assumptions (even if they initially seem unrealistic) capture something that is essential to explaining what it is that the theory is trying to explain.
D)  if the theory's predictions are consistently accurate, then the theory is definitely valid.

Question 9

A gift-giver's efficient number of gifts (to give to a gift-recipient)has fallen from 10 to 8.  This could be because

Accepted Answer

A)  the gift-giver's marginal benefit and marginal cost curves for giving gifts remained constant.
B)  the gift-giver's marginal cost curve of giving gifts shifted up and leftward.
C)  the gift-recipient "fell out" of the gift-giver's utility function.
D)  the gift-giver's marginal cost curve of giving gifts shifted down and rightward.

Question 10

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 one person is, the _____________likely that person will have to further engage with people he encounters.

Accepted Answer

A)  more; less
B)  less; less
C)  more; more
D)  less; more

Question 11

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).

Accepted Answer

A)  downward-sloping over units 1 -10.
B)  upward-sloping over units 1-10.
C)  horizontal over units 1-10.
D)  vertical over units 1-10.
E)  There is not enough information provided to answer the question.

Question 12

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

Accepted Answer

A)  spend the $200 on what Anna hopes that he will spend it on.
B)  save the $200, and not spend it on anything.
C)  spend the $200 on whatever is next on Billy's list of things to buy.
D)  spend the $200 on something that Anna does not want him to spend it on.

Question 13

When a home is located in a city with a reputation for _________ weather, homebuyers in the area _____________________ for their homes because of that weather,  ceteris paribus .

Accepted Answer

A)  good; indirectly pay a higher price
B)  good; indirectly pay a lower price
C)  bad; directly pay a higher price
D)  bad; indirectly pay a higher

Question 14

People sometimes act differently in different settings.  An economist is likely to explain this by saying

Accepted Answer

A)  the benefits and costs of certain behaviors can be different in different settings.
B)  people are hard to figure out.
C)  people behave as others behave.
D)  it is hard to figure out what makes people tick.

Question 15

The _________________ the opportunity cost of bad behavior, __________________________.

Accepted Answer

A)  higher; the less likely one is to exhibit bad behavior
B)  lower; there will be no resulting change in one's likelihood to exhibit bad behavior
C)  higher; the more likely one is to exhibit bad behavior
D)  lower; the less likely one is to exhibit bad behavior

Question 16

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

Accepted Answer

A)  if the supply of openings at each university is the same, then the demand to attend university B must be higher than the demand to attend university A.
B)  the supply of openings is necessarily larger at university A than B.
C)  instructors at university B are likely to be more punctual for their office hours than instructors at university A.
D)  instructors at university A are more likely to be punctual for their office hours than instructors at university B.

Question 17

If a theory gives a scientist results that she does not want, then she should not believe in that theory.

Accepted Answer

A) True 
 B)False

Question 18

Those who say that economics is becoming an increasingly imperialist social science are suggesting that economics is

Accepted Answer

A)  becoming increasingly concerned with corporations rather than small businesses.
B)  becoming increasingly focused on government actions rather than on business activity.
C)  spreading out into other fields of study, such as history, anthropology, and sociology.
D)  becoming increasingly focused on business activity rather than on government actions.

Question 19

For economic imperialists, economics is more of a method of analysis than a specific field of study.

Accepted Answer

A) True 
 B)False

Question 20

Scientists prefer to advance irrefutable theories, rather than refutable theories.

Accepted Answer

A) True 
 B)False

Exam 19: Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

To an economist, it is preferable to

Theory B predicts that everything that happens, happens for a reason - although we may not know what the reason is. This theory

Which of the following is not a prediction of the theory on baseball caps and cheating?

A theory predicts that all swans are white. A thousand people go out into the field and identify the color of the swans they see. Their results reveal that, of the 10,000 swans they saw, all were white. It follows that

A person tends to be __ likely to lose her temper with a boss than with a friend because the opportunity cost of losing her temper with her boss tends to be _ than the opportunity cost of losing her temper with her friend.

Economists often evaluate a theory in terms of how consistently and accurately it predicts what happens. Implicit in this position is the belief that

A gift-giver's efficient number of gifts (to give to a gift-recipient) has fallen from 10 to 8. This could be because

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 one person is, the _likely that person will have to further engage with people he encounters.

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

When a home is located in a city with a reputation for _ weather, homebuyers in the area _____________ for their homes because of that weather, ceteris paribus .

People sometimes act differently in different settings. An economist is likely to explain this by saying

The _ the opportunity cost of bad behavior, __________.

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

If a theory gives a scientist results that she does not want, then she should not believe in that theory.

Those who say that economics is becoming an increasingly imperialist social science are suggesting that economics is

For economic imperialists, economics is more of a method of analysis than a specific field of study.

Scientists prefer to advance irrefutable theories, rather than refutable theories.