Macro 1.1.8

Which of the following is an advantage of pure capitalism?

Buyers and sellers interact to exchange goods

Which of the following statements is true?

The value of a good may change over time

How do economists account for unpredictability for people when they make theories about people's behavior?

They assume people's divergent tendencies balance each other out toward an average

True or False: A line that rises as it moves from left to right has a positive slope.

True

True or False: Distinguishing between two theories that explain measurements or observations equally well can be a problem for economists.

True

Free enterprise allows:

buyers and sellers to exchange goods in a free market, with price indicating value

A factory belongs to which category of the factors of production?

capital

Which of the following are important assumptions that economists make when developing theories?

ceteris paribus and self-interest

Which of the following is sometimes considered the fourth factor of production?

entrepreneurship

Which of the following is not part of the scientific method, as applied to economics problems?

formulate an irrefutable hypothesis

The circular flow of economic activity can be summed up as:

households earn money by selling their factors of production to firms in the factor market and use that money to buy goods and services from firms in the product market

True or False. All economic systems use central planners to decide how much of a good will be produced.

False

True or False: An online auction house is not a market since the buyers and sellers are geographically dispersed

False

True or False: Entrepreneurs are willing to accept risks for an opportunity to earn a salary by producing a new, innovative product or approach to business.

False

A command economy is synonymous with:

a centrally planned economy

Which of the following would not be studied by a macroeconomist?

a firm's production decision

A hypothesis is:

a statement explaining how variables relate to one another

The biggest disadvantage is a command economy is:

the lack of incentive for individuals

When we talk about the slope of a line we mean:

the rise over the run

China and Russia are:

transitional economies