No one knows which variables will change and which will remain constant.
ANSWER:
c
79. What do economists use the term ceteris paribus to indicate?
a.
It is a Greek term that refers to the causation between two variables.
b.
Their normative ideas are validated with constant empirical evidence over time.
c.
Other things are assumed to remain constant.
d.
The analysis is true for the individual but not for the economy as a whole.
ANSWER:
c
80. What does ceteris paribus mean?
a.
If events A and B occur together, one must cause the other.
b.
Other things are held constant.
c.
What is true for the individual must be true for the whole.
d.
All relevant details are included.
ANSWER:
b
81. What does the ceteris paribus assumption enable?
a.
the separation of normative economic issues from positive economic issues
b.
an analysis of the relationship between two variables separate from the influence of other variables
c.
all variables to be held constant so the economy can be carefully observed in a suspended state
d.
a generalization from the whole to the individual
ANSWER:
b
82. A theory asserts that manufacturers are less willing to sell units of output as the price of goods decreases. However, as the price of smartphones fell throughout the 2000s, more smartphones were sold. Which of the following explanations best describes this apparent conflict between theory and data?
a.
It is likely that variables other than the price and quantity of smartphones sold were changing.
b.
The theory must be incorrect and other principles associated with production must be reassessed.
c.
The theory rests on assumptions that are too simplistic.
d.
Smartphone manufacturers were acting irrationally and it is very unlikely they profited during this time period.
ANSWER:
a
83. A theory asserts that consumers will purchase less of a good at higher prices than they will at lower prices. However, when the average price of cars increased throughout the 1990s, more cars were purchased. Which of the following explanations best describes this apparent conflict between theory and data?
a.
The price and quantity data gathered by researchers were clearly measured incorrectly.
b.
It is likely that variables other than the price and quantity of cars demanded were changing.
c.
The ceteris paribus assumption is valid.
d.
The theory must be invalid.
ANSWER:
b
84. A scientist is trying to test a theory about the relationship between people’s smoking and their longevity. Which of the following variables would the scientist NOT hold constant?
a.
the past histories of heart and lung disease
b.
the amount of dietary fat that people in the experimental group consumed
c.
the amount of alcohol that people in the experimental group consumed
d.
the number of cigarettes that people in the experimental group smoked
ANSWER:
d
85. What is the term for when two events generally happen at the same time?
a.
causation
b.
correlation
c.
coordination
d.
cooperation
ANSWER:
b
86. What is the term for when one event causes another event to occur?
a.
causation
b.
correlation
c.
coordination
d.
collaboration
ANSWER:
a
87. Consider the statement, “Every time I write an exam, it is raining.” Which one of the following concepts is insinuated in this statement?
a.
causation
b.
correlation
c.