At a price for which quantity demanded exceeds quantity supplied, a __________ is
experienced, which pushes the price __________ toward its equilibrium value.
a. surplus; downward
b. surplus; upward
c. shortage; downward
d. shortage; upward
Attempts to determine “what is” are part of __________ economics.
a. positive
b. normative
c. positive and normative
d. neither positive nor normative
Economic growth causes the PPF to
a. shift leftward.
b. shift rightward.
c. remain constant.
d. go from a straight line to a curve.
The research of economists Stevenson and Wolfers tends to support the Easterlin
paradox.
a. True
b. False
A natural disaster, such as the 2011 Japanese earthquake and tsunami, shifts the
___________ curve _____________________.According to economists who believe
that the economy is self-regulating, the result will be that the economy
_____________be able to find its way back to Natural Real GDP without government
intervention.
a. SRAS; rightward; will
b. SRAS; leftward; will not
c. AD; leftward; will not
d. SRAS; leftward; will
e. AD; leftward; will
Look at the following data: GDP = $11,920 billion; investment = $2,100 billion; exports
= $500 billion; government purchases = $1,450 billion; consumption = $8,500 billion.
What does import spending equal?
a. $630 billion
b. $370 billion
c. $1,320 billion
d. $430 billion
e. $474 billion
A shortage of kidneys (for transplants) results from
a. the legal price being set below the equilibrium price.
b. the legal price being set above the equilibrium price.
c. a price floor being set in the kidney market at P = $0, assuming the equilibrium price
is greater than $0.
d. a price ceiling being set in the kidney market at P = $0, assuming the equilibrium
price is greater than $0.
e. a and d
If a person gives a gift to another person, an economist would say that it is because
a. the marginal benefit of giving the gift is at least as great as the marginal cost of
giving the gift.
b. the marginal cost of giving the gift is at least as great as the marginal benefit of
giving the gift.
c. he expects to receive a gift in return.
d. none of the above
An agricultural price support
a. will create a surplus in the relevant market, assuming the price support is above
equilibrium price.
b. will create a shortage in the relevant market, assuming the price support is above
equilibrium price.
c. is an example of a price floor.
d. will lead to greater total revenue for farmers if demand (for the product) farmers sell
is inelastic between the equilibrium price and the price support (and assuming the price
support is above equilibrium price).
e. a, c, and d
If increasingly more units of good Y must be given up as each successive unit of good
X is produced, then the PPF for these two goods is
a. a downward-sloping straight line.
b. circular.
c. an upward-sloping curve.
d. a downward-sloping curve that is bowed outward.
e. a downward-sloping curve that is bowed inward.
Exhibit 6-2
The unemployment rate in year 4 is
a. 12 1/2 percent.
b. 72 percent.
c. 87 1/2 percent.
d. 10 percent.
e. 90 percent.