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Econ 201 Exam Questions Ans Accurate Answers
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Econ 201 Exam Questions Ans Accurate Answers 2024-2025Historical evidence shows that : - Answer free economies outperform command
economies over the long run.
The study of how carbon taxes would affect the use of energy by individual households
and firms belongs to the realm of: - Answer microeconomics.
Which of the following is an example of a topic studied by macroeconomists? - Answer
Total output of an economy
Pareto Efficient An outcome is Pareto efficient if: - Answer no individual can be made
better off without making someone else worse off.
The Scientific Method The scientific method refers to the process by which economists
and other scientists: - Answer develop models of the world and test those models with
data.
Which of the following is a key property of models?
All models are consistent and do not make incorrect predictions.
All economic models start from assumptions.
All models can only be used for a limited time.
Testing of models does not need to be empiricist. - Answer All economic models start
from assumptions.
Which of the following is CORRECT?
Normative economics refers to what people actually do.
Normative economics is free from value judgements, tastes and preferences of
economic agents.
, Positive economics yields descriptive statements that are capable of testing from data.
Positive economics prescribes what individuals should do. - Answer Positive
economics yields descriptive statements that are capable of testing from data.
Which of the following statements distinguishes between correlation and causation -
Answer Correlation implies an interdependence of two things; causation shows that one
thing directly affects another.
Omitted variable A variable that: - Answer was left out, and if included would explain
why the variables considered in a study are correlated.
If the total cost incurred in hiring five workers for an hour is $45 and the total cost
incurred when the sixth worker is hired is $ 60, then the marginal cost of hiring the sixth
worker is: - Answer $15.
Optimization in differences analyzes: - Answer the change in the net benefits resulting
from a shift from one alternative to another.
________ uses the concept of marginal analysis to determine the optimum choice. -
Answer Optimization in differences
Which of the following statements identifies something that is the same for both
optimization in levels and optimization in differences? - Answer Both methods involve
changing all costs and benefits to a common unit of measurement
Which of the following statements is true for economic reasoning? - Answer Economic
reasoning enables individuals to make the most of scarce resources.
The net benefit of a particular alternative equals: - Answer the benefits received from
the alternative minus the costs incurred in choosing the alternative.
If a particular choice that an individual faces gives him a benefit of $20 but costs $30,
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