Quiz 2

A  1/50 of a gun

B  50 guns

C  20 guns

D  1/50 of a tank

A  an indisputable statistical fact

B  empirically verifiable by checking economic data

C  a positive statement

D  a normative statement

E  an incorrect positive statement

A  suggests that consumers become less fashionable for those goods.

B  does not apply to goods traded in competitive markets

C  suggests that those goods are inferior goods

D  shows that the quantity demanded is inversely related to price

E  suggests that most goods are normal goods

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

B  both the demand and supply curves typically slope downward

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

D  both the demand and supply curve typically slope upward

A  a financial statement

B  a political statement

C  macroeconomic observation

D  a positive statement

E  a normative statement

A  market price for good X will rise

B  market price for good X will decrease

C  demand for good X will increase

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 show a relationship between quantity and price

D  they both usually slope downward

A  surpluses.

B  shortages.

C  a new market equilibrium.

D  a greater number of exchanges.

A  increased prices of other Ford models

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  an increase in the U.S. population

A  technical inefficiency would not exist in the long run

B  the demand curve usually slopes downward

C  the law of demand applies to most markets

D  the supply curve usually slopes upward

A  price will fall and quantity will rise

B  quantity will fall, but price may rise or fall

C  price and quantity will fall

D  price will rise and quantity will fall

E  price and quantity will rise

A  costs of production are sky rocketing

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

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

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

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

B  the government allocates resources while prices allocate goods and services

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

A  rise in supply and demand together

B  increase in supply, with demand constant

C  increase in demand, with supply constant

D  decrease in supply and demand together

E  decrease in demand, with supply constant

A  determining whether the government should reduce poverty

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

C  determining whether too many luxury goods are being produced

D  determining the best level of immigration into the country

A  increase in price

B  rise in resource input prices

C  decrease in the number of firms in the market

D  increase in quantity demanded

A  economic history.

B  economy-wide phenomena.

C  how firms maximize profit.

D  economic growth and GDP

E  individual decision-makers.

A  economic growth.

B  opportunity cost.

C  tradeoffs.

D  supply and demand.

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  Both a and b are correct.

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

E  All of the above are correct.