Demand is a schedule that shows
A) a set of possible prices for a good and the quantities of the good that will be purchased at each of those prices.
B) how much income it takes to afford various quantities of a good.
C) the relationship between the cost of producing a good and the price that sellers will charge.
D) how population changes will affect the amount of a good that is needed.
Ques. 2Following adjustments to a new equilibrium in a market, the equilibrium quantity remains unchanged, but the market clearing price is now lower. Which of the following could definitely have caused this outcome?
A) Demand and supply both increased.
B) Demand and supply both decreased.
C) Demand increased, and supply decreased.
D) Demand decreased, and supply increased.
Ques. 3Government can correct for negative externalities by
A) decreasing taxes.
B) increasing taxes or regulation.
C) allowing the market system to correct the problem.
D) decreasing the costs to those responsible for the externality.
Ques. 4People respond to incentives
A) by ignoring negative incentives and responding to positive incentives only.
B) only when they are irrational.
C) as they never intentionally make decisions that would leave them worse off.
D) when they have low incomes.
Ques. 5Using the above figure, which of the lines in the above diagram represents a regressive tax?
A) A
B) B
C) C
D) none of them
Quick Reply
