In a market, the rationing function of prices results in
A) long queues or waiting lines.
B) a price ceiling.
C) equilibrium.
D) a shortage or surplus.
Ques. 2Which of the following factors will lead to a shift in the demand curve?
A) changes in the costs of inputs
B) changes in technology
C) changes in the price of the good
D) changes in consumers' tastes and preferences
Ques. 3The transactions demand for money will increase when
A) the rate of interest increases.
B) the price level falls.
C) nominal Gross Domestic Product (GDP) increases.
D) nominal Gross Domestic Product (GDP) decreases.
Ques. 4The hypothesis that people are nearly, but not fully rational, cannot possibly fully examine every available choice, and utilize simple rules of thumb in making decisions is known as the
A) irrationality hypothesis.
B) ceteris paribus hypothesis.
C) individual aggregation hypothesis.
D) bounded rationality hypothesis.
Ques. 5Regarding unemployment, the classical model implies that
A) unemployment always exists.
B) unemployment cannot exist.
C) voluntary unemployment is zero, but involuntary unemployment often is fairly high.
D) only voluntary unemployment exists.
Ques. 6Between the years 1998 and 2001, the U.S. government experienced
A) budget surpluses.
B) balanced budgets.
C) budget deficits.
D) contractionary budget cycles.
Ques. 7When a business produces a product that creates external costs
A) the company produces a level of output larger than would be produced without the external cost.
B) the company produces a level of output smaller than would be produced without the external cost.
C) the company produces a level of output which would be the same as it would produce without the external cost.
D) the market provides the efficient level of output even with the existence of the external cost.
Ques. 8According to the text, during World War II rationing was conducted in the U.S. through the use of
A) queuing.
B) lotteries.
C) coupons.
D) sharing.
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