Quiz 2

A  50 guns

B  1/50 of a tank

C  20 guns

D  1/50 of a gun

A  an indisputable statistical fact

B  a normative statement

C  empirically verifiable by checking economic data

D  an incorrect positive statement

E  a positive statement

A  does not apply to goods traded in competitive markets

B  suggests that most goods are normal goods

C  suggests that consumers become less fashionable for those goods.

D  suggests that those goods are inferior 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 curves typically slope downward

C  both the demand and supply curve typically slope upward

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

A  macroeconomic observation

B  a financial statement

C  a political statement

D  a positive statement

E  a normative statement

A  market price for good X will decrease

B  demand for good X will increase

C  market price for good X will rise

D  demand for good X will decrease

A  they both usually slope downward

B  they both show a relationship between quantity and price

C  they both usually slope upward

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

A  shortages.

B  surpluses.

C  a new market equilibrium.

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 will fall and quantity will rise

B  price 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  costs of production are sky rocketing

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

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

B  prices determine both what firms produce and what consumers buy

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

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

E  the government allocates resources while prices allocate goods and services

A  decrease in demand, with supply constant

B  decrease in supply and demand together

C  increase in demand, with supply constant

D  increase in supply, with demand constant

E  rise in supply and demand together

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

B  determining whether the government should reduce poverty

C  determining the best level of immigration into the country

D  determining whether too many luxury goods are being produced

A  increase in price

B  increase in quantity demanded

C  rise in resource input prices

D  decrease in the number of firms in the market

A  economic history.

B  economic growth and GDP

C  economy-wide phenomena.

D  how firms maximize profit.

E  individual decision-makers.

A  recession and unemployment

B  tradeoffs.

C  supply and demand.

D  opportunity cost.

E  economic growth.

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

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

E  All of the above are correct.