Quiz 2

A  1/50 of a tank

B  50 guns

C  20 guns

D  1/50 of a gun

A  an indisputable statistical fact

B  a positive statement

C  an incorrect positive statement

D  a normative statement

E  empirically verifiable by checking economic data

A  suggests that those goods are inferior goods

B  shows that the quantity demanded is inversely related to price

C  suggests that consumers become less fashionable for those goods.

D  suggests that most goods are normal goods

E  does not apply to goods traded in competitive markets

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 financial statement

B  a normative statement

C  macroeconomic observation

D  a positive statement

E  a political statement

A  demand for good X will increase

B  demand for good X will decrease

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 downward

C  they both usually slope upward

D  they both show a relationship between quantity and price

A  surpluses.

B  a new market equilibrium.

C  shortages.

D  a greater number of exchanges.

A  an increase in buyers’ incomes

B  increased prices of other Ford models

C  an increase in the U.S. population

D  a decrease in the price of steel

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

A  technical inefficiency would not exist in the long run

B  the supply curve usually slopes upward

C  the demand curve usually slopes downward

D  the law of demand applies to most markets

A  price and quantity will fall

B  price will rise and quantity will fall

C  price will fall and quantity will rise

D  quantity will fall, but price may rise or fall

E  price and quantity will rise

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

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 less of something else

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

B  the government allocates resources while prices allocate goods and services

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

D  prices determine both what firms produce and what consumers buy

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

A  decrease in supply and demand together

B  rise 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 whether the government should reduce poverty

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

C  determining whether too many luxury goods are being produced

D  determining the best level of immigration into the country

A  increase in quantity demanded

B  increase in price

C  decrease in the number of firms in the market

D  rise in resource input prices

A  how firms maximize profit.

B  individual decision-makers.

C  economic history.

D  economic growth and GDP

E  economy-wide phenomena.

A  opportunity cost.

B  tradeoffs.

C  recession and unemployment

D  economic growth.

E  supply and demand.

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

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

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.