Quiz 2

A  1/50 of a tank

B  20 guns

C  50 guns

D  1/50 of a gun

A  an incorrect positive statement

B  a normative statement

C  a positive statement

D  an indisputable statistical fact

E  empirically verifiable by checking economic data

A  suggests that those goods are inferior goods

B  suggests that consumers become less fashionable for those goods.

C  does not apply to goods traded in competitive markets

D  suggests that most goods are normal goods

E  shows that the quantity demanded is inversely related to price

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

B  both the demand and supply curve typically slope upward

C  both the demand and supply curves typically slope downward

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

A  a positive statement

B  a political statement

C  a normative statement

D  a financial statement

E  macroeconomic observation

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  a new market equilibrium.

C  shortages.

D  a greater number of exchanges.

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

B  a decrease in the price of steel

C  an increase in the U.S. population

D  increased prices of other Ford models

E  an increase in buyers’ incomes

A  the law of demand applies to most markets

B  technical inefficiency would not exist in the long run

C  the demand curve usually slopes downward

D  the supply curve usually slopes upward

A  price will fall and quantity will rise

B  price and quantity will fall

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

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

C  costs of production are sky rocketing

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

A  prices determine both what firms produce and what consumers buy

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

C  the government allocates resources while prices allocate goods and services

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

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

A  increase 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  decrease 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 whether the government should reduce poverty

D  determining the best level of immigration into the country

A  increase in price

B  rise in resource input prices

C  increase in quantity demanded

D  decrease in the number of firms in the market

A  economic growth and GDP

B  economic history.

C  economy-wide phenomena.

D  how firms maximize profit.

E  individual decision-makers.

A  tradeoffs.

B  supply and demand.

C  economic growth.

D  opportunity cost.

E  recession and unemployment

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

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

C  Both a and b are correct.

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

E  All of the above are correct.