Quiz 2

A  1/50 of a gun

B  50 guns

C  1/50 of a tank

D  20 guns

A  empirically verifiable by checking economic data

B  a positive statement

C  a normative statement

D  an incorrect positive statement

E  an indisputable statistical fact

A  suggests that those goods are inferior goods

B  suggests that most goods are normal goods

C  does not apply to goods traded in competitive markets

D  shows that the quantity demanded is inversely related to price

E  suggests that consumers become less fashionable for those goods.

A  both the demand and supply curves typically slope downward

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

C  both the demand and supply curve typically slope upward

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

A  macroeconomic observation

B  a normative statement

C  a political statement

D  a positive statement

E  a financial statement

A  demand for good X will increase

B  market price for good X will rise

C  demand for good X will decrease

D  market price for good X will decrease

A  they both show a relationship between quantity and price

B  they both usually slope downward

C  they both usually slope upward

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

A  surpluses.

B  a greater number of exchanges.

C  shortages.

D  a new market equilibrium.

A  an increase in the U.S. population

B  an increase in buyers’ incomes

C  a decrease in the price of steel

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

E  increased prices of other Ford models

A  the demand curve usually slopes downward

B  technical inefficiency would not exist in the long run

C  the supply curve usually slopes upward

D  the law of demand applies to most markets

A  price will rise and quantity will fall

B  price and quantity will rise

C  price and quantity will fall

D  price will fall and quantity will rise

E  quantity will fall, but price may rise or fall

A  costs of production are sky rocketing

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

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

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

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

B  prices determine both what firms produce and what consumers buy

C  the government allocates resources while prices allocate goods and services

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

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

A  decrease in supply and demand together

B  increase in demand, with supply constant

C  decrease in demand, with supply constant

D  rise in supply and demand together

E  increase in supply, with demand constant

A  determining the best level of immigration into the country

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

C  determining whether the government should reduce poverty

D  determining whether too many luxury goods are being produced

A  increase in quantity demanded

B  increase in price

C  decrease in the number of firms in the market

D  rise in resource input prices

A  economic history.

B  economic growth and GDP

C  economy-wide phenomena.

D  individual decision-makers.

E  how firms maximize profit.

A  supply and demand.

B  tradeoffs.

C  opportunity cost.

D  economic growth.

E  recession and unemployment

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

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

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

D  Both a and b are correct.

E  All of the above are correct.