Questions:
Question 1.Which of the following is true of scarcity?
It is a basic problem of microeconomics, not macroeconomics.
It applies to raw materials; manufactured goods are not scarce.
It affects all countries.
It affects only poor nations.
It is a basic problem of macroeconomics, not microeconomics.
Question 2.If the demand for coffee decreases as income decreases, coffee is a(n):
normal good.
inferior good.
substitute good.
complementary good.
Question 3.All but which one of the following could shift the demand curve?
A shift of the supply curve
A rise in income
A change in the price of substitutes
An increase in the size of the age group buying that good
A successful advertising campaign which convinces people that they want more of this good
Question 4.In what type of economic system are the basic economic questions answered in the same way as in the past?
A planned economy
A traditional economy
A command economy
A market economy
Question 5.If there is a need to increase the quantity and supply of oil, the most effective way to get it quickly is to
improve technology.
reduce the prices of the resources that produce oil.
increase the price of oil.
put a limit on the price of oil.
ban imports.
Question 6.Sales of bananas have dropped from 100,000 pounds to 75,000 pounds per day because a freeze resulted in a smaller supply. In the process, the average price of a pound of bananas has risen from $0.80 to $1.00. Which of the following is most likely true?
The demand for bananas has increased because of the increase in price.
The demand for ice cream (used in banana splits) is likely to decrease.
The price of tapes will rise about 25 percent.
The total revenue (P times Q) from sales has risen.
The quantity demanded of ice cream will increase.
Question 7.Ceteris paribus, as applied in demand theory, means
accounting for all possible simultaneous changes.
holding constant all factors that affect demand except one.
observing the real world.
holding technology and resource prices constant.
holding one input constant while changing the other input.
Question 8.If left alone, a market-directed economy will
invariably provide the correct economic choices.
provide the correct economic choice in many but not all cases.
protect consumers from monopoly.
avoid the production problems encountered in command economies.
disintegrate.
Question 9.Which of the following would be described as capital by an economist?
Government bonds
Corporate bonds
Petroleum reserves owned by a corporation
Common stocks traded on a national exchange
The power lift in a service station
Question 10.Capital consists of
the assets of a firm.
the assets of the government.
the assets of upper-income groups.
aids to production created by humans.
stocks and bonds.