Ch 2. Thinking Like An Economist

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.title[
# Ch 2. Thinking Like An Economist
]
.subtitle[
## Seminars in Financial Economics for Students of Accounting, Finance, and Digital Applications
]
.author[
### Lyuben Ivanov, PhD
]
.institute[
### Sofia University St. Kliment Ohridski
]
.date[
### Spring Term 2025/2026
]

---

# Facility Index: 0% (0/9)

<div class="container">
    <div class="question">
        <p>The production possibilities frontier is bowed outward if</p>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice1" id="choiceA1" value="A">
        <label class="form-check-label" for="choiceA1">
            the amount of resources increases.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice1" id="choiceB1" value="B">
        <label class="form-check-label" for="choiceB1">
            the level of technology increases.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice1" id="choiceC1" value="C">
        <label class="form-check-label" for="choiceC1">
            resources are not perfectly shiftable.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice1" id="choiceD1" value="D">
        <label class="form-check-label" for="choiceD1">
            There are two correct answers.
        </label>
    </div>
    <br>
    <button class="btn btn-custom mt-3" onclick="checkAnswer('C', 'result1', 'choice1')">Submit</button>
    <div class="result" id="result1"></div>
  </div>

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# Facility Index: 0% (0/2)

<div class="container">
    <div class="question">
        <p>Almost all economists agree that rent control</p>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice2" id="choiceA2" value="A">
        <label class="form-check-label" for="choiceA2">
            allows the market for housing to work more efficiently.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice2" id="choiceB2" value="B">
        <label class="form-check-label" for="choiceB2">
            adversely affects the availability and quality of housing.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice2" id="choiceC2" value="C">
        <label class="form-check-label" for="choiceC2">
            is a very inexpensive way to help the most needy members of society.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice2" id="choiceD2" value="D">
        <label class="form-check-label" for="choiceD2">
            improves the availability and quality of housing.
        </label>
    </div>
    <br>
    <button class="btn btn-custom mt-3" onclick="checkAnswer('B', 'result2', 'choice2')">Submit</button>
    <div class="result" id="result2"></div>
  </div>

---

# Facility Index: 9.09% (1/11)

<div class="container">
    <div class="question">
        <p>The US Congress relies on economists at the Congressional Budget Office to</p>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice3" id="choiceA3" value="A">
        <label class="form-check-label" for="choiceA3">
            enforce the nation’s antitrust laws.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice3" id="choiceB3" value="B">
        <label class="form-check-label" for="choiceB3">
            analyze economic developments in the United States.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice3" id="choiceC3" value="C">
        <label class="form-check-label" for="choiceC3">
            set the nation’s monetary policy.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice3" id="choiceD3" value="D">
        <label class="form-check-label" for="choiceD3">
            obtain independent evaluations of policy proposals.
        </label>
    </div>
    <br>
    <button class="btn btn-custom mt-3" onclick="checkAnswer('D', 'result3', 'choice3')">Submit</button>
    <div class="result" id="result3"></div>
  </div>

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# Facility Index: 14.29% (1/7)

.pull-left[

</div>
]

.pull-right[

<div class="container">
    <div class="question">
        <p>In the production possibilities frontier shown, the movement from point C to point D was most likely caused by</p>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice4" id="choiceA4" value="A">
        <label class="form-check-label" for="choiceA4">
            unemployment.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice4" id="choiceB4" value="B">
        <label class="form-check-label" for="choiceB4">
            fewer resources available for production.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice4" id="choiceC4" value="C">
        <label class="form-check-label" for="choiceC4">
            a decrease in society's preference for bananas.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice4" id="choiceD4" value="D">
        <label class="form-check-label" for="choiceD4">
            natural disaster.
        </label>
    </div>
    <br>
    <button class="btn btn-custom mt-3" onclick="checkAnswer('A', 'result4', 'choice4')">Submit</button>
    <div class="result" id="result4"></div>
  </div>

]

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# Facility Index: 20% (2/10)

<div class="container">
    <div class="question">
        <p>In the circular-flow diagram, money spent by households</p>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice5" id="choiceA5" value="A">
        <label class="form-check-label" for="choiceA5">
            is used to purchase factors of production.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice5" id="choiceB5" value="B">
        <label class="form-check-label" for="choiceB5">
            cannot be tracked in the diagram.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice5" id="choiceC5" value="C">
        <label class="form-check-label" for="choiceC5">
            is earned from the factors of production they provide to firms.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice5" id="choiceD5" value="D">
        <label class="form-check-label" for="choiceD5">
            becomes profit to firms.
        </label>
    </div>
    <br>
    <button class="btn btn-custom mt-3" onclick="checkAnswer('C', 'result5', 'choice5')">Submit</button>
    <div class="result" id="result5"></div>
  </div>

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# Facility Index: 25% (1/4)

<div class="container">
    <div class="question">
        <p>Production possibilities frontiers can shift outward if</p>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice6" id="choiceA6" value="A">
        <label class="form-check-label" for="choiceA6">
            government increases the amount of money in the economy.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice6" id="choiceB6" value="B">
        <label class="form-check-label" for="choiceB6">
            there is an increase in technology.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice6" id="choiceC6" value="C">
        <label class="form-check-label" for="choiceC6">
            resources can be moved from the production of one good to another.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice6" id="choiceD6" value="D">
        <label class="form-check-label" for="choiceD6">
            There are two correct answers.
        </label>
    </div>
    <br>
    <button class="btn btn-custom mt-3" onclick="checkAnswer('B', 'result6', 'choice6')">Submit</button>
    <div class="result" id="result6"></div>
  </div>

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# Facility Index: 27.27% (3/11)

Suppose an economy produces two goods, food and machines. This economy always operates on its production possibilities frontier. Last year, it produced 50 units of food and 30 machines. This year it experienced a technological advance in its machine-making industry. As a result, this year the society wants to produce 55 units of food and 30 machines.

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# Facility Index: 27.27% (3/11)

<div class="container">
    <div class="question">
        <p>Which of the following statements is true?</p>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice7" id="choiceA7" value="A">
        <label class="form-check-label" for="choiceA7">
            Because the technological advance occurred in the machine-making industry, it will not be possible to increase food production without reducing machine production below 30.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice7" id="choiceB7" value="B">
        <label class="form-check-label" for="choiceB7">
            Because the technological advance occurred in the machine-making industry, increases in output can only occur in the machine industry.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice7" id="choiceC7" value="C">
        <label class="form-check-label" for="choiceC7">
            In order to increase food production in these circumstances without reducing machine production, the economy must reduce inefficiencies.
        </label>
    </div>
    <div class="form-check">
        <input class="form-check-input" type="radio" name="choice7" id="choiceD7" value="D">
        <label class="form-check-label" for="choiceD7">
            The technological advance reduced the amount of resources needed to produce 30 machines. These resources could be used to produce more food.
        </label>
    </div>
    <br>
    <button class="btn btn-custom mt-3" onclick="checkAnswer('D', 'result7', 'choice7')">Submit</button>
    <div class="result" id="result7"></div>
  </div>

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# Questions?

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# Thank You!

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