Question 1

Public-use data refer to ________.
A) data that have to be purchased from an external agent
B) data that are available to anyone who wants to use it
C) data published by the government only during political campaigns
D) data collected by a researcher only through field investigation

Accepted Answer

Public-use data are data that are available to anyone who wants to use it without any restrictions or limitations. These types of data are often made available by government agencies, research institutions or private companies to facilitate data sharing and promote transparency. Data can be accessed through online portals or by request, but they are generally not sold to external agents. Public-use data can be used for research, analysis, and policy-making purposes.

Question 2

The following table shows the monthly wages of five different individuals.
 
-Refer to the table above.The average monthly wage of the five workers is ________.
A) $600
B) $450
C) $440
D) $0

Accepted Answer

To find the average monthly wage, we need to add up all the wages and divide by the number of workers. 
Adding up the wages: 
$400 + $450 + $350 + $500 + $350 = $2050 
Dividing by 5 (the number of workers): 
$2050/5 = $410 
Therefore, the average monthly wage of the five workers is $410, which is closest to option C, $440.

Question 3

Annie,Darwin,Dorothy,Christian,and Isabella are five college students who work as part-time bartenders.If their average weekly earnings is $100,then their total weekly earnings is ________.
A) $500
B) $400
C) $250
D) $700

Accepted Answer

If their average weekly earnings is $100, then the total earnings of the five students in a week is $100 x 5 = $500. Therefore, the best answer is A) $500.

Question 4

Which of the following is a key property of models?
A) All economic models begin with assumptions.
B) Empiricism is not essential for testing models.
C) All models can be used for a limited time only.
D) All models are consistent and do not make incorrect predictions.

Accepted Answer

One of the key properties of models is that they begin with assumptions. These assumptions are necessary simplifications of reality that allow economists to make predictions and analyze the behavior of the economy. Without assumptions, models would be overly complex and difficult to use. However, it is important to recognize that these assumptions may not accurately reflect all aspects of the real world, and therefore the predictions of the model may not always be accurate.

Question 5

A model is based on an assumption that an additional year of education increases a student's future wage by 20 percent.
-Refer to the scenario above.Which of the followings statements is true of the model?
A) The predictions of this model can be verified empirically.
B) The predictions of this model can only be applied for a limited number of years of additional education.
C) According to the model, 2 additional years of education will increase an individual's future wages 1.20 times.
D) According to the model, 2 additional years of education will increase an individual's future wages 2.98 times.

Accepted Answer

The model's assumption that an additional year of education increases a student's future wage by 20 percent is a quantifiable claim that can be tested against real-world data, making its predictions empirically verifiable.

Question 6

The average income of 25 employees working in a firm is $1,754 per month.What is the total income of all the employees?
A) $40,000
B) $43,850
C) $56,225
D) $63,950

Accepted Answer

To find the total income, we need to multiply the average income by the number of employees. 
Total income = Average income x Number of employees
Total income = $1,754 x 25
Total income = $43,850
Therefore, the best choice is B, as it matches the calculated total income.

Question 7

A local swimming club enrolled thirty-five new members during the current year and charged each member a onetime membership fee of $200.What is the total membership fee collected by the club from the new members this year?
A) $1,750
B) $2,000
C) $7,000
D) $3,500

Accepted Answer

The total membership fee collected from the new members is equal to the number of new members multiplied by the membership fee per member. Thus, the total membership fee collected is 35 x $200 = $7,000. Therefore, the correct answer is C, $7,000.

Question 8

A model is based on an assumption that an additional year of education increases a student's future wage by 20 percent.
-Refer to the scenario above.Which of the following statements is true about the model?
A) The model is not based on any assumption.
B) The predictions of the model will hold for every individual.
C) The model describes the economic payoff of more education.
D) The model can be applied for a maximum of 10 years of additional education.

Accepted Answer

The model describes the economic payoff of more education, as it assumes that an additional year of education will increase a student's future wage by 20 percent. However, it does not make any claims about the predictions holding true for every individual (B) or the maximum number of years of education that can be applied (D). It is also based on an assumption (A) that may or may not be true in reality.

Question 9

Which of the following statements is true about the mean of a series?
A) The mean is equal to zero when all the values are identical.
B) The mean is a commonly used technique for summarizing data.
C) The mean is less than all the individual observations in the data set.
D) The mean is calculated as the sum of all values multiplied by the number of values.

Accepted Answer

The mean is a commonly used technique for summarizing data. Option A is false as the mean would not be zero if all values are identical but not equal to zero. Option C is false as the mean value is a representative value and could be greater or less than some of the individual observations in the data set. Option D is false as the mean is calculated by summing up all the values and dividing by the number of values.

Question 10

The following table shows the monthly wages of five different individuals.
 
-Refer to the table above.What is the average monthly wage?
A) $450
B) $558
C) $612
D) $650

Accepted Answer

To find the average monthly wage, we need to add the five wages and then divide by five (the number of individuals). ($400 + $600 + $700 + $500 + $540)/5 = $558. Therefore, the average monthly wage is $558, which is option B.

Question 11

In a hypothetical country,the average wage of five 40-year-old citizens with a college education is $36,896,and the average wage of five 40-year-old citizens with a high school education is $25,864.What is the returns-to-college education in the country? Is there any limitation of this analysis? Explain your answer.

Accepted Answer

The answer of In a hypothetical country,the average wage of...

Question 12

In country X,the average yearly salary of 50-year-olds with 16 years of education is $50,275,while the average yearly salary of 50-year-olds with 12 years of education is $36,265.According to these data,4 additional years of education are likely to be correlated with higher future wages of about ________.
A) 24 percent
B) 38 percent
C) 50 percent
D) 88 percent

Accepted Answer

The difference in average yearly salary between 50-year-olds with 16 years of education and those with 12 years of education is $14,010 ($50,275 - $36,265). If we assume that the 4 additional years of education are likely to result in a proportional increase in salary, we can calculate the percentage increase as follows: 
$14,010 is 38% of $36,265 ($14,010/$36,265 x 100% = 38.6%). Therefore, the answer is B) 38 percent.

Question 13

A model is based on an assumption that an additional year of education increases a student's future wage by 20 percent.
-Refer to the scenario above.Which of the following statements is true of the model?
A) The predictions of this model cannot be tested with data.
B) The predictions of this model are accurate and will hold for all individuals.
C) The predictions of this model can be applied to unlimited years of additional education.
D) The model predicts that two additional years of education is likely to increase future earnings by 60 percent.

Accepted Answer

The model assumes a constant percentage increase per year, but it doesn't account for diminishing returns or other factors that might limit the applicability of this assumption over many years.

Question 14

A model is based on an assumption that an additional year of education increases a student's future wage by 20 percent.
-Refer to the scenario above.Which of the following statements is true about the model's prediction?
A) The prediction cannot be verified empirically.
B) The prediction is precise, exact, and accurate for the entire population.
C) The prediction is an approximate relationship and may not hold for everyone.
D) The prediction can be applied to estimate the returns only for a limited number of years of additional education.

Accepted Answer

The statement mentions that the model is based on an assumption, which means it is not a precise, exact, or accurate relationship for the entire population. Additionally, the model's prediction is an approximate relationship and may not hold true for everyone. Therefore, option C is the correct answer. Option A is not correct as the prediction can be verified empirically. Option B is not correct because the model's prediction is not precise or accurate for everyone. Option D is not relevant to the given scenario as there is no mention of limitations on estimating the returns for a limited number of years of additional education.

Question 15

What are the two important properties of all models?

Accepted Answer

The answer of What are the two important properties of...

Question 16

An economic model suggests that for every additional year of education,an individual's future wages increase by 5 percent.If Richard,with 12 years of education,earns $20 per hour,how much will he earn per hour if he decides to undertake 4 additional years of education?

Accepted Answer

The answer of An economic model suggests that for every...

Question 17

An economic model suggests that an additional year of education increases a student's future wages by 15 percent.Using this model,answer the following questions.
a)Gary completes 8 years of education,and John completes 9 years of education.If Gary earns $20 per hour,how much is John expected to earn?
b)John completes 9 years of education,and Kevin completes 12 years of education.Given John's earnings (as calculated in part a),how much is Kevin expected to earn?
c)Is there any limitation to such a model? Explain your answer.

Accepted Answer

The answer of An economic model suggests that an additional...

Question 18

The weights of six students in the seventh grade are 120 lbs,110 lbs,105 lbs,100 lbs,96 lbs,and 90 lbs.The average weight of the six students is ________.
A) 105 lbs.
B) 103.5 lbs.
C) 100 lbs.
D) 95 lbs.

Accepted Answer

To find the average weight, we sum up all the weights and divide it by the number of students:
120 + 110 + 105 + 100 + 96 + 90 = 621
621 / 6 = 103.5
Therefore, the average weight of the six students is 103.5 lbs, so the answer is B.

Question 19

The mean of a data set is the ________.
A) product of all values divided by the number of values
B) sum of all different values divided by the number of values
C) sum of all different values multiplied by the number of values
D) difference between the highest value and the lowest value

Accepted Answer

The mean of a set of values is calculated by adding up all of the values and then dividing by the number of values. Therefore, the mean is the sum of all different values divided by the number of values, which is option B. Options A, C, and D are incorrect definitions of the mean.

Question 20

Which of the following implies that a model is an approximation?
A) The model is not based on any assumption.
B) The predictions of the model are mostly wrong.
C) The predictions of the model will hold in most cases but not all.
D) The predictions of the model cannot be tested with data.

Accepted Answer

Choice C implies that the model is an approximation because it suggests that the predictions of the model will hold in most cases but not all, indicating that the model is not a perfect representation of reality. Choices A, B, and D do not necessarily imply that the model is an approximation. Choice A suggests that the model is not based on any assumptions, which could be true of a simple, exact model. Choice B suggests that the model is mostly wrong, which could indicate that the model is not a good representation of reality, but it does not necessarily imply that it is an approximation. Choice D suggests that the predictions of the model cannot be tested with data, which is not necessarily related to whether the model is an approximation or not.

Quiz 2: Economic Methods and Economic Questions

Public-use data refer to ________.

The following table shows the monthly wages of five different individuals. -Refer to the table above.The average monthly wage of the five workers is ________.

Annie,Darwin,Dorothy,Christian,and Isabella are five college students who work as part-time bartenders.If their average weekly earnings is $100,then their total weekly earnings is ________.

Which of the following is a key property of models?

A model is based on an assumption that an additional year of education increases a student's future wage by 20 percent. -Refer to the scenario above.Which of the followings statements is true of the model?

The average income of 25 employees working in a firm is $1,754 per month.What is the total income of all the employees?

A local swimming club enrolled thirty-five new members during the current year and charged each member a onetime membership fee of $200.What is the total membership fee collected by the club from the new members this year?

A model is based on an assumption that an additional year of education increases a student's future wage by 20 percent. -Refer to the scenario above.Which of the following statements is true about the model?

Which of the following statements is true about the mean of a series?

The following table shows the monthly wages of five different individuals. -Refer to the table above.What is the average monthly wage?

A model is based on an assumption that an additional year of education increases a student's future wage by 20 percent. -Refer to the scenario above.Which of the following statements is true of the model?

A model is based on an assumption that an additional year of education increases a student's future wage by 20 percent. -Refer to the scenario above.Which of the following statements is true about the model's prediction?

What are the two important properties of all models?

An economic model suggests that for every additional year of education,an individual's future wages increase by 5 percent.If Richard,with 12 years of education,earns $20 per hour,how much will he earn per hour if he decides to undertake 4 additional years of education?

The weights of six students in the seventh grade are 120 lbs,110 lbs,105 lbs,100 lbs,96 lbs,and 90 lbs.The average weight of the six students is ________.

The mean of a data set is the ________.

Which of the following implies that a model is an approximation?