Quiz 2

A  1/50 of a gun

B  20 guns

C  50 guns

D  1/50 of a tank

A  an indisputable statistical fact

B  a normative statement

C  an incorrect positive statement

D  empirically verifiable by checking economic data

E  a positive statement

A  suggests that most goods are normal goods

B  suggests that consumers become less fashionable for those 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 those goods are inferior 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  both the demand and supply curve typically slope upward

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

A  a positive statement

B  macroeconomic observation

C  a political statement

D  a normative statement

E  a financial statement

A  demand for good X will decrease

B  market price for good X will decrease

C  demand for good X will increase

D  market price for good X will rise

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

B  they both show a relationship between quantity and price

C  they both usually slope upward

D  they both usually slope downward

A  a greater number of exchanges.

B  surpluses.

C  a new market equilibrium.

D  shortages.

A  a decrease in the price of steel

B  increased prices of other Ford models

C  an increase in the U.S. population

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

E  an increase in buyers’ incomes

A  technical inefficiency would not exist in the long run

B  the law of demand applies to most markets

C  the demand curve usually slopes downward

D  the supply curve usually slopes upward

A  price and quantity will fall

B  price will fall and quantity will rise

C  price will rise and quantity will fall

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

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

D  prices determine both what firms produce and what consumers buy

E  the government allocates resources while prices allocate goods and services

A  increase in supply, with demand constant

B  decrease in demand, with supply constant

C  increase in demand, with supply constant

D  decrease in supply and demand together

E  rise in supply and demand together

A  determining whether the government should reduce poverty

B  determining the best level of immigration into the country

C  determining whether too many luxury goods are being produced

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

A  rise in resource input prices

B  increase in price

C  increase in quantity demanded

D  decrease in the number of firms in the market

A  economic history.

B  economic growth and GDP

C  how firms maximize profit.

D  economy-wide phenomena.

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

C  Both a and b are correct.

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.