Exhibit 39-3
If P3 is a target price, the deficiency payment per unit is
a. P1.
b. P2.
c. P3.
d. P3 – P1.
e. P3 – P2.
Exhibit 3-2
Good X
Suppose equilibrium is at point A. Something then changes and equilibrium becomes
point C. Which of the following is consistent with the change in equilibrium from point
A to C (assuming that good X is a normal good)?
a. There was a decrease in the number of buyers and business taxes increased.
b. There was an increase in the number of buyers and business taxes decreased.
c. There was an increase in the number of buyers and business taxes increased.
d. There was a decrease in the number of buyers and business taxes decreased.
Suppose that an individual can hold her wealth in only two forms: money and bonds.A
_______________ in the bond market would then imply that there is a
________________ in the money market.
a. surplus; surplus
b. shortage; shortage
c. surplus; shortage
d. shortage; surplus
e. c and d
Ceteris paribus, economics predicts that voter turnout will be higher
a. the smaller the number of eligible voters.
b. the larger the number of eligible voters.
c. the easier it is to get to the polls on election day.
d. a and c
e. b and c
If people have only two ways of holding their wealth, money or bonds, a surplus in the
money market implies a surplus in the bond market.
a. True
b. False
In a PPF graph of goods X and Y, points that lie beyond (to the right of) the PPF
represent combinations of the two goods that are currently unattainable.
a. True
b. False
Public choice economists often explain low voter turnouts in terms of
a. dissatisfaction of many voters with the limited choice of candidates.
b. lack of civic responsibility of the electorate.
c. net costs of voting that many voters perceive.
d. rational ignorance of many voters of the actual date of the elections.
According to the textbook, in the book version of The Wonderful Wizard of Oz,
Dorothy’s slippers are
a. gold.
b. silver.
c. ruby.
d. paper.
Which of the following statements is false?
a. In 2006, some people with subprime and other nontraditional loans were not able to
make their monthly payments on their mortgage loans.
b. The leverage ratio is the ratio of assets to capital.
c. John Taylor argued that the global savings glut was the reason for the low interest
rates in the early-2000s and for the rise in housing prices that followed.
d. It is possible for a bank to have the value of its liabilities greater than the value of its
assets.
e. none of the above
Exhibit 13-2
What word (up or down) should go in the place of blank (5) and blank (6), respectively?
a. up; up
b. up; down
c. down; up
d. down; down
A gift-giver’s efficient number of gifts (to give to a gift-recipient) has fallen from 10 to
8.This could be because
a. the gift-giver’s marginal benefit curve for giving gifts shifted down and left.
b. the gift-giver’s marginal cost curve of giving gifts shifted up and left.
c. the gift-recipient “fell out” of the gift-giver’s utility function.
d. a and b
e. none of the above