Econ 201 Exam Questions and
Answers 100% Pass
Historical evidence suggests that: - ✔✔free economies perform better than command
economies in the long run.
Understanding the impact of carbon taxes on the energy usage of individual
households and firms is studied under: - ✔✔microeconomics.
Which of the following is an example of a topic studied by macroeconomists? - ✔✔Total
output of an economy
An outcome is Pareto efficient if: - ✔✔no individual can be made better off without
making someone else worse off.
The scientific method refers to the process by which economists and other scientists: -
✔✔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 begin with assumptions.
All models can be used for a limited time period only.
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, Empiricism is not essential for testing models. - ✔✔All economic models begin with
assumptions.
Which of the following statements is true?
Normative economics describes what people actually do.
Normative economics is free from value judgments, tastes, and preferences of
economic agents.
Positive economics generates objective descriptions that can be verified with data.
Positive economics describes what people ought to do. - ✔✔Positive economics
generates objective descriptions that can be verified with data.
Which of the following statements identifies a difference between correlation and
causation - ✔✔Correlation implies a mutual relationship between two things, whereas
causation occurs when one thing directly affects another.
An omitted variable is a variable that: - ✔✔has been 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, the marginal cost of hiring the sixth
worker is: - ✔✔$15.
Optimization in differences analyzes: - ✔✔the change in the net benefits resulting from
a shift from one alternative to another.
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 2
Answers 100% Pass
Historical evidence suggests that: - ✔✔free economies perform better than command
economies in the long run.
Understanding the impact of carbon taxes on the energy usage of individual
households and firms is studied under: - ✔✔microeconomics.
Which of the following is an example of a topic studied by macroeconomists? - ✔✔Total
output of an economy
An outcome is Pareto efficient if: - ✔✔no individual can be made better off without
making someone else worse off.
The scientific method refers to the process by which economists and other scientists: -
✔✔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 begin with assumptions.
All models can be used for a limited time period only.
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 1
, Empiricism is not essential for testing models. - ✔✔All economic models begin with
assumptions.
Which of the following statements is true?
Normative economics describes what people actually do.
Normative economics is free from value judgments, tastes, and preferences of
economic agents.
Positive economics generates objective descriptions that can be verified with data.
Positive economics describes what people ought to do. - ✔✔Positive economics
generates objective descriptions that can be verified with data.
Which of the following statements identifies a difference between correlation and
causation - ✔✔Correlation implies a mutual relationship between two things, whereas
causation occurs when one thing directly affects another.
An omitted variable is a variable that: - ✔✔has been 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, the marginal cost of hiring the sixth
worker is: - ✔✔$15.
Optimization in differences analyzes: - ✔✔the change in the net benefits resulting from
a shift from one alternative to another.
EMILY CHARLENE © 2025, ALL RIGHTS RESERVED 2
