An increase in the equilibrium quantity of good X can be caused by
A) an increase the price of inputs utilized in producing good X.
B) an increase in the price of good X.
C) a technological improvement in the process of producing good X.
D) a reduction in the number of producers of good X.
Ques. 2If production of an item results in negative external costs, then
A) the market price is below the socially preferred price that reflects the external costs.
B) the market price is above the socially preferred price that reflects the external costs.
C) market forces will always correct the problem.
D) the market quantity is too low from society's point of view.
Ques. 3One opportunity cost associated with going to college is
A) purchasing text books.
B) paying tuition.
C) giving up employment possibilities while in college.
D) paying for room, board, and other living expenses.
Ques. 4The potential rewards that are available to an individual if a particular activity is undertaken are known as
A) premiums.
B) gifts.
C) incentives.
D) intrinsic values.
Ques. 5A market demand schedule for a product indicates that
A) as the product's price falls, consumers buy less of the good.
B) there is a positive relationship between price and quantity demanded.
C) as a product's price rises, consumers buy more of the good.
D) there is a negative relationship between price and quantity demanded.
Ques. 6The marginal tax rate can be calculated by which of the following formulas?
A) the change in taxes due divided by the change in taxable income
B) the change in taxable income divided by the change in taxes due
C) total taxes due divided by total taxable income
D) total taxable income divided by total taxes due
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