Question: Consider this Laffer Curve. If the tax rate is increased beyond “t*”, government tax revenues decline. Which of the following explanations for this phenomenon did we discuss in class?
Answer Options:
A. Higher tax rates may reduce people’s incentives to work and lead them to quit.
B. Higher rates may lead high earning individuals to move abroad.
C. Higher tax rates may encourage people to engage in tax evasion or tax avoidance.
D. a and c
Answer: D. a and c
Question: Which of the following institutions plays no role in allocating resources in a modern market-oriented economy?
Answer Options:
A. All of the other institutions play some role in allocating resources in a modern market-oriented economy.
B. Government
C. Firms
D. Households
E. Custom or Tradition
Answer: E. Custom or Tradition
Question: Adam Smith argued that the wealth of a nation could best be measured by the:
Answer Options:
A. Number of colonies it possessed.
B. Size of its navy and army.
C. Quantity of taxes it collected.
D. Living standard of its citizens.
Answer: D. Living standard of its citizens.
Question: Which of the following statements is most accurate?
Answer Options:
A. Wealthy societies are unaffected by scarcity.
B. Scarcity implies the need to make choices.
C. Michigan has extensive state and national forests. As a result, timber is not scarce in this state.
D. Economics is the study of how we solve the problem of scarcity.
Answer: D. Economics is the study of how we solve the problem of scarcity.
Question: Thinking about what constitutes “good theory,” the simplest form of the Ptolemaic model (the one without epicycles) of the solar system was a bad theory because it:
Answer Options:
A. Failed to accurately predict the location of the planets over time.
B. Is hard to understand.
C. Put the Earth at the center of the solar system.
D. Failed to include the outer planets.
Answer: A. Failed to accurately predict the location of the planets over time.
Question: When negative correlation exists between two variables:
Answer Options:
A. A change in one variable has no effect on the other variable.
B. One variable will have a negative value whenever the other has a positive value.
C. An increase in one variable leads to negative values of the other variable.
D. A decrease in one variable is associated with an increase in the other variable.
Answer: D. A decrease in one variable is associated with an increase in the other variable.
Question: Generally speaking, we should engage in prescriptive economics:
Answer Options:
A. Prior to abstraction.
B. Only after we collect large amounts of data.
C. When our model makes consistently good predictions.
D. Before we engage in induction.
Answer: C. When our model makes consistently good predictions.
Question: Which of these terms describes the process of generating theories from individual facts?
Answer Options:
A. Calculation
B. Induction
C. Reduction
D. Deduction
Answer: B. Induction
Question: Which of the following processes that we’ve discussed is key to the testing of a model?
Answer Options:
A. Deduction
B. Attenuation
C. Induction
D. Abstraction
Answer: A. Deduction
Question: A nurse is caring for a client who is at 32 weeks of gestation and has deep-vein thrombosis. Which of the following actions should the nurse take?
Answer Options:
Place the client with their knees in a sharply flexed position.
Administer warfarin PO daily.
Measure and record the client’s leg circumferences daily.
Monitor the client’s RBCs every 4 hr.
Answer: Measure and record the client’s leg circumferences daily.