Question 1

Normative statements are

Accepted Answer

prescriptive, whereas positive statements are descriptive

Question 2

Positive statements are

Accepted Answer

claims about how the world is

Question 3

Irregular fluctuations in economic activity are known as the

Accepted Answer

business cycle

Question 4

Differences in scientific judgment between economists are similar to all of the following except

Accepted Answer

two politicians arguing about the fairness of the tax code

Question 5

Suppose an economist advises a city's mayor to begin charging drivers a fee to drive on a busy highway during congested times. The mayor does not implement the policy because it would not be popular with voters. Which of the following statements best describes the scenario?

Accepted Answer

This is a common occurrence. The policymaker knows the best policy but chooses not to institute it for other reasons

Question 6

When economists make

Accepted Answer

positive statements, they are speaking not as policy advisers but as scientists.

Question 7

When an economist evaluates a positive statement, he or she is primarily

Accepted Answer

All of the above are correct: examining evidence, acting as a scientist, concerned with verifying how the world is

Question 8

In principle, we can

Accepted Answer

confirm or refute positive statements by examining evidence

Question 9

When economists make

Accepted Answer

normative statements, they are speaking not as scientists but as policy advisers

Question 10

A positive economic statement such as Pollution taxes decrease the quantity of pollution firms generate

Accepted Answer

would require data but not values to be evaluated.

Question 11

Which of the following is an example of a positive, as opposed to normative, statement?

Accepted Answer

Prices rise when the government prints too much money

Question 12

The difference between economists speaking as scientists or policy advisers boil down to the difference between

Accepted Answer

positive statements and normative statements.

Question 13

When economists are trying to explain the world, they are

Accepted Answer

scientists.

Question 14

Which of the following is a positive, as opposed to a normative, statement?

Accepted Answer

The US Department of Justice sued AT&T to block its merger with T-Mobile.

Question 15

A statement describing how the world should be

Accepted Answer

is a normative statement.

Question 16

When economists are trying to help improve the world, they are

Accepted Answer

policy advisers.

Question 17

The production possibilities frontier is a graph that shows the various combinations of output that an economy

Accepted Answer

can produce.

Question 18

The production possibilities frontier is used to illustrate some basic economic ideas, including

Accepted Answer

All of the above are correct: scarcity, opportunity cost, economic growth

Question 19

Indiadesh is a country that produces two goods, textiles and computers. Last year, Indiadesh produced 50,000 textiles and 1300 computers. This year it produced 45,000 textiles and 1100 computers. Given no further information, which of the following events could explain this change?

Accepted Answer

Indiadesh experienced a reduction in resources.

Question 20

Economists speaking like scientists make

Accepted Answer

claims about how the world is.

Question 21

Economists speaking like policy advisers make

Accepted Answer

claims about how the world should be.

Question 22

A normative economic statement such as The minimum wage should be abolished

Accepted Answer

would require values and data to be evaluated.

Question 23

Which of the following is an example of a positive, as opposed to normative, statement?

Accepted Answer

When the minimum wage is increased, unemployment is a predictable consequence.

Question 24

Prices rise when the quantity of money rises rapidly is an example of a

Accepted Answer

positive economic statement.

Question 25

Economists view normative statements as

Accepted Answer

prescriptive, making a claim about how the world ought to be.

Question 26

Which of the following trade-offs does the production possibilities frontier illustrate?

Accepted Answer

Once an economy has reached the efficient points on its production possibilities frontier, the only way of getting more of one good is to get less of the other.

ECON 101 - CH 2 Questions

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