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Chapter 2 Thinking Like an Economist

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Question;7. Which of the following is one of the basic;reasons why economists often appear to give conflicting advice to policymakers?;a.;similar;opinions about the validity of economic theories;b.;significant;differences in education;c.;differences;in personal values;d.;a;reliance on normative statement for research theories;8. Erma and Wayne are both economists. Erma thinks that taxing consumption, rather;than income, would result in higher household saving because income that is;saved would not be taxed. Wayne does not;think that household saving would respond much to a change in the tax;laws. In this example, Erma and Wayne;a.;have;different normative views about tax policy.;b.;disagree;about the validity of a positive theory.;c.;must;both be incorrect because economists always agree on policy issues.;d.;None of;the above is correct.;9. Which of the following statements is correct;about the extent of disagreement among economists?;a.;There is;a great deal of agreement among economists on virtually every economic issue.;b.;There is;a great deal of agreement among economists on many important economic issues.;c.;All;disagreements among economists are attributable to differences in their;values.;d.;All;disagreements among economists are attributable to the fact that different;economists have different degrees of faith in the validity of alternative;economic theories.;10. A survey which sought the opinion of professional economists on;fourteen propositions about economic policy found that;a.;the;respondents were almost equally divided on the propositions.;b.;the;respondents favored the propositions by a slight margin.;c.;the;respondents disagreed with the propositions by a slight margin.;d.;there;was overwhelming endorsement of the propositions among the respondents.;11. A survey of professional economists revealed that more than;three-fourths of them agreed with a number of statements, including which of;the following?;a.;Tariffs;and import quotas usually reduce general economic welfare.;b.;A large;federal budget deficit has an adverse effect on the economy.;c.;Minimum;wage increases unemployment among young and unskilled workers.;d.;All of;the above are correct.;12. A survey of professional economists revealed that more than;three-fourths of them agreed with fourteen economic propositions. Which of the following is not one of;those propositions?;a.;The;United States should not restrict employers from outsourcing work to foreign;countries.;b.;The;United States should withdraw from the North American Free Trade Agreement;(NAFTA).;c.;The;United States should eliminate agricultural subsidies.;d.;Local;and state governments should eliminate subsidies to professional sports;franchises.;13. A survey of professional economists revealed that more than;three-fourths of them agreed with fourteen economic propositions. Which of the following is not one of;those propositions?;a.;A;ceiling on rents reduces the quantity and quality of housing available.;b.;Fiscal;policy has a significant stimulative impact on a less than fully employed;economy.;c.;The gap;between Social Security funds and expenditures will become unsustainably;large within the next fifty years if current policies remain unchanged.;d.;The;United States should implement universal health care for its citizens.;14. Almost all economists agree that rent control;a.;has no;effect on the rental income of landlords.;b.;allows;the market for housing to work more efficiently.;c.;adversely;affects the availability and quality of housing.;d.;is a;very inexpensive way to help the most needy members of society.;15. Policies such as rent control and trade barriers persist in spite;of the fact that economists are virtually united in their opposition to such;policies, probably because;a.;economists;have not yet convinced the general public that the policies are undesirable.;b.;economists;engage in positive analysis, not normative analysis.;c.;economists;have values that are different from the values of most non-economists.;d.;economists?;theories are not easily confirmed or refuted in laboratory analysis.;16. Policies such as rent control and trade barriers persist;a.;because;economists are about evenly divided as to the merits of those policies.;b.;because;almost all economists agree that those policies have no discernible economic;effects.;c.;because;almost all economists agree that those policies are desirable.;d.;despite;the fact that almost all economists agree that those policies are;undesirable.

 

Paper#55196 | Written in 18-Jul-2015

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