Quiz 2

A  20 guns

B  1/50 of a gun

C  50 guns

D  1/50 of a tank

A  a positive statement

B  an incorrect positive statement

C  empirically verifiable by checking economic data

D  an indisputable statistical fact

E  a normative statement

A  does not apply to goods traded in competitive markets

B  suggests that consumers become less fashionable for those goods.

C  suggests that most goods are normal goods

D  suggests that those goods are inferior goods

E  shows that the quantity demanded is inversely related to price

A  both the demand and supply curves typically slope downward

B  the demand curve typically slopes downward; the supply curve typically slopes upward

C  the demand curve typically slopes upward; the supply curve typically slopes downward

D  both the demand and supply curve typically slope upward

A  a positive statement

B  a political statement

C  macroeconomic observation

D  a normative statement

E  a financial statement

A  demand for good X will increase

B  market price for good X will decrease

C  market price for good X will rise

D  demand for good X will decrease

A  they both usually slope upward

B  neither of them is influenced by the size of the population

C  they both usually slope downward

D  they both show a relationship between quantity and price

A  a new market equilibrium.

B  surpluses.

C  shortages.

D  a greater number of exchanges.

A  an increase in buyers’ incomes

B  increased prices of other Ford models

C  increase in price of similar model produced by Chevy and Dodge

D  an increase in the U.S. population

E  a decrease in the price of steel

A  the supply curve usually slopes upward

B  technical inefficiency would not exist in the long run

C  the demand curve usually slopes downward

D  the law of demand applies to most markets

A  price and quantity will fall

B  quantity will fall, but price may rise or fall

C  price and quantity will rise

D  price will rise and quantity will fall

E  price will fall and quantity will rise

A  when an individual obtains more of a good, he may not be fully satisfied

B  costs of production are sky rocketing

C  to produce more of one thing, we must produce less of something else

D  to produce more of one thing, we must produce more of everything

A  the government, producers, and consumers work together and allocate resources while prices allocate goods and services

B  prices determine what firms produce while the government determines what consumers buy

C  prices determine both what firms produce and what consumers buy

D  prices determine what consumers buy while the government determines what firms produce

E  the government allocates resources while prices allocate goods and services

A  decrease in demand, with supply constant

B  increase in supply, with demand constant

C  decrease in supply and demand together

D  rise in supply and demand together

E  increase in demand, with supply constant

A  determining whether too many luxury goods are being produced

B  determining the impact of government spending on the actual level of total employment

C  determining the best level of immigration into the country

D  determining whether the government should reduce poverty

A  increase in quantity demanded

B  rise in resource input prices

C  decrease in the number of firms in the market

D  increase in price

A  individual decision-makers.

B  economic history.

C  how firms maximize profit.

D  economy-wide phenomena.

E  economic growth and GDP

A  economic growth.

B  tradeoffs.

C  opportunity cost.

D  supply and demand.

E  recession and unemployment

A  only if the family is not in economic competition with other families.

B  Both a and b are correct.

C  by allowing each person to specialize in the activities he or she does best.

D  by allowing the family to buy a greater variety of goods and services at a lower cost.

E  All of the above are correct.