Quiz 2

A  20 guns

B  1/50 of a tank

C  50 guns

D  1/50 of a gun

A  a normative statement

B  a positive statement

C  empirically verifiable by checking economic data

D  an indisputable statistical fact

E  an incorrect positive statement

A  shows that the quantity demanded is inversely related to price

B  suggests that most goods are normal goods

C  suggests that consumers become less fashionable for those goods.

D  does not apply to goods traded in competitive markets

E  suggests that those goods are inferior goods

A  both the demand and supply curve typically slope upward

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

C  both the demand and supply curves typically slope downward

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

A  a positive statement

B  macroeconomic observation

C  a financial statement

D  a political statement

E  a normative statement

A  market price for good X will rise

B  demand for good X will decrease

C  demand for good X will increase

D  market price 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 upward

D  they both usually slope downward

A  shortages.

B  a new market equilibrium.

C  surpluses.

D  a greater number of exchanges.

A  an increase in buyers’ incomes

B  an increase in the U.S. population

C  a decrease in the price of steel

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

E  increased prices of other Ford models

A  the law of demand applies to most markets

B  the supply curve usually slopes upward

C  the demand curve usually slopes downward

D  technical inefficiency would not exist in the long run

A  price and quantity will rise

B  price will fall and quantity will rise

C  price and quantity will fall

D  price will rise and quantity will fall

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  costs of production are sky rocketing

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 more of everything

A  the government allocates resources while prices allocate goods and services

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

C  prices determine both what firms produce and what consumers buy

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

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  decrease in supply and demand together

C  increase in supply, with demand constant

D  decrease in demand, with supply constant

E  increase in demand, with supply constant

A  determining the best level of immigration into the country

B  determining whether too many luxury goods are being produced

C  determining whether the government should reduce poverty

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

A  rise in resource input prices

B  decrease in the number of firms in the market

C  increase in price

D  increase in quantity demanded

A  individual decision-makers.

B  economy-wide phenomena.

C  economic growth and GDP

D  how firms maximize profit.

E  economic history.

A  tradeoffs.

B  opportunity cost.

C  supply and demand.

D  recession and unemployment

E  economic growth.

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

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  Both a and b are correct.

E  All of the above are correct.