Quiz 2

A  20 guns

B  1/50 of a tank

C  1/50 of a gun

D  50 guns

A  an indisputable statistical fact

B  a positive statement

C  empirically verifiable by checking economic data

D  a normative statement

E  an incorrect positive statement

A  shows that the quantity demanded is inversely related to price

B  does not apply to goods traded in competitive markets

C  suggests that those goods are inferior goods

D  suggests that consumers become less fashionable for those goods.

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 positive statement

B  a normative statement

C  a political statement

D  macroeconomic observation

E  a financial statement

A  demand for good X will decrease

B  demand for good X will increase

C  market price for good X will rise

D  market price for good X will decrease

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

B  they both usually slope upward

C  they both show a relationship between quantity and price

D  they both usually slope downward

A  shortages.

B  a new market equilibrium.

C  surpluses.

D  a greater number of exchanges.

A  a decrease in the price of steel

B  an increase in buyers’ incomes

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

D  increased prices of other Ford models

E  an increase in the U.S. population

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 and quantity will rise

B  price will fall and quantity will rise

C  price will rise and quantity will fall

D  price and quantity will fall

E  quantity will fall, but price may rise or fall

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  prices determine both what firms produce and what consumers buy

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

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

D  the government allocates resources while prices allocate goods and services

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

A  increase in supply, with demand constant

B  decrease in supply and demand together

C  increase in demand, with supply constant

D  decrease in demand, with supply constant

E  rise in supply and demand together

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  decrease in the number of firms in the market

B  rise in resource input prices

C  increase in price

D  increase in quantity demanded

A  economy-wide phenomena.

B  how firms maximize profit.

C  individual decision-makers.

D  economic growth and GDP

E  economic history.

A  supply and demand.

B  tradeoffs.

C  opportunity cost.

D  recession and unemployment

E  economic growth.

A  Both a and b are correct.

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

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

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.