What is the term that describes a situation in which one party to an economic
transaction has less information than the other party?
A) inefficient market hypothesis
B) asymmetric information
C) unequal market structure
D) monopsony
If your nominal wage rises faster than the price level, we can say your real wage has
________ and the purchasing power of your income has ________.
A) fallen; fallen
B) fallen; risen
C) risen; risen
D) risen; fallen
Table 2-1
Production Choices for Dina’s Diner
Refer to Table 2-1. Dina faces ________ opportunity costs in the production of sliders
and hot wings.
A) increasing
B) decreasing
C) constant
D) negative
When the price of a good rises, consumers buy a smaller quantity because of the
________ effect and the ________ effect.
A) substitution; income
B) normal; inferior
C) substitute; complement;
D) supply; demand
Discouraged workers are classified by the BLS as
A) part of the labor force.
B) out of the labor force.
C) unemployed.
D) employed.
E) part-time employees.
The substitution bias in the consumer price index refers to the idea that consumers
________ the quantity of products they buy in response to price, and the CPI does not
reflect this and ________ the cost of the market basket.
A) change; overestimates
B) change; underestimates
C) do not change; overestimates
D) do not change; underestimates
If the price of smartphones was to increase, then
A) the demand for smartphone apps would decrease.
B) the demand for smartphone apps would increase.
C) the quantity of smartphone apps demanded would increase.
D) the quantity of smartphone apps demanded would decrease.
If the price of pineapple juice was $4.50 a gallon and it is now $5.75 a gallon, what is
the percentage change in price?
A) 7.8 percent
B) 12.5 percent
C) 27.7 percent
D) 57.5 percent
Because of the slope of the aggregate demand curve, we can say that
A) a decrease in the price level leads to a lower level of real GDP demanded.
B) an increase in the price level leads to no change in the level of real GDP demanded.
C) a decrease in the price level leads to a higher level of real GDP demanded.
D) an increase in the price level leads to a higher level of real GDP demanded.
A demand curve shows the relationship between
A) the price of a product and the quantity of the product demanded.
B) the amount of a product sellers are willing to sell at a particular price and the amount
consumers are willing to buy at that price.
C) the quantity that consumers are willing and able to buy and the quantity that sellers
are willing and able to offer.
D) the price of a produce and the demand for the product.