At a zero price, which of the following conditions is TRUE for an economic good?
A) Its quantity supplied exceeds its quantity demanded.
B) Its quantity demanded exceeds its quantity supplied.
C) Its quantity demanded equals its quantity supplied.
D) Scarcity disappears.
Ques. 2The law of demand is based on the observation that
A) people buy less of a product when the product becomes less fashionable.
B) people buy more of a product when the price falls.
C) people are indifferent to price changes.
D) stores go out of business if they lower prices.
Ques. 3Microeconomics is defined as that part of economic analysis that
A) studies the behavior of the economy as a whole.
B) includes the problems of inflation and unemployment.
C) studies individual decision making by households and firms.
D) concerns aggregate production and consumption.
Ques. 4The law of demand tells us that people will buy more of a good if
A) the price of that good decreases.
B) the prices of other goods decrease.
C) people's income increases.
D) every factor that can affect people's buying decisions changes.
Ques. 5In economics
A) both resources and wants are limited.
B) both resources and wants are unlimited.
C) resources are limited but wants are unlimited.
D) resources are unlimited but wants are limited.
Ques. 6Which is the best example of an intangible good?
A) the car you dream of owning but cannot afford
B) the suit you hope will make a good impression when you go on job interviews
C) the textbook study guide you hope will prepare you to perform well on examinations
D) the advice and expertise provided by the music store clerk who sold you that CD
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