Quiz 2

A  20 guns

B  50 guns

C  1/50 of a gun

D  1/50 of a tank

A  an indisputable statistical fact

B  empirically verifiable by checking economic data

C  an incorrect positive statement

D  a normative statement

E  a positive statement

A  suggests that consumers become less fashionable for those goods.

B  suggests that those goods are inferior goods

C  suggests that most goods are normal goods

D  does not apply to goods traded in competitive markets

E  shows that the quantity demanded is inversely related to price

A  both the demand and supply curves typically slope downward

B  both the demand and supply curve typically slope upward

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

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

A  a political statement

B  macroeconomic observation

C  a positive statement

D  a financial 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  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 downward

D  they both usually slope upward

A  surpluses.

B  a new market equilibrium.

C  shortages.

D  a greater number of exchanges.

A  an increase in the U.S. population

B  a decrease in the price of steel

C  an increase in buyers’ incomes

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

E  increased prices of other Ford models

A  technical inefficiency would not exist in the long run

B  the demand curve usually slopes downward

C  the supply curve usually slopes upward

D  the law of demand applies to most markets

A  price will fall and quantity will rise

B  price will rise and quantity will fall

C  price and quantity will rise

D  quantity will fall, but price may rise or fall

E  price and quantity will fall

A  costs of production are sky rocketing

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

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

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

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

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

C  the government allocates resources while prices allocate goods and services

D  prices determine both what firms produce and what consumers buy

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

A  increase in supply, with demand constant

B  increase in demand, with supply constant

C  rise in supply and demand together

D  decrease in demand, with supply constant

E  decrease in supply and demand together

A  determining whether too many luxury goods are being produced

B  determining whether the government should reduce poverty

C  determining the best level of immigration into the country

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  decrease in the number of firms in the market

D  increase in quantity demanded

A  individual decision-makers.

B  economic history.

C  economic growth and GDP

D  how firms maximize profit.

E  economy-wide phenomena.

A  opportunity cost.

B  supply and demand.

C  recession and unemployment

D  economic growth.

E  tradeoffs.

A  Both a and b are correct.

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

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

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.