A change in an equilibrium price can result from I. A change in demand II. A change in supply
A) I only
B) II only
C) Both I and II
D) Neither I nor II
Ques. 2Central planning is a key characteristic of which economic system?
A) free market
B) price system
C) command and control
D) mixed economic system
Ques. 3The law of demand states that there is
A) an inverse relationship between income and quantity demanded, ceteris paribus.
B) a direct relationship between income and quantity demanded, ceteris paribus.
C) no relationship between taste and quantity demanded, ceteris paribus.
D) an inverse relationship between price and quantity demanded, ceteris paribus.
Ques. 4Of the following, which is the largest source of government funds in the long run?
A) government borrowing
B) government transfers
C) user fees
D) taxation
Ques. 5Human beings
A) have unlimited wants.
B) think they have unlimited wants, but really have limited needs.
C) have limited wants, but unlimited needs.
D) know what their needs are, but do not know what their wants are.
Ques. 6When market failures occur
A) the invisible hand will correct for the market failures.
B) the price system will correct the market failures.
C) people will reduce their consumption.
D) the government can step in to correct the market failure.
Ques. 7If equilibrium price falls and the equilibrium quantity of the good purchased decreases, what has happened to either the supply curve or to the demand curve?
A) Supply increased.
B) Demand decreased.
C) Demand increased.
D) Supply decreased.
Ques. 8Total market demand can be calculated by
A) horizontally summing individual demand curves at each and every price level.
B) vertically summing individual demand curves at each and every income level.
C) adding up the largest quantity demanded by each individual.
D) looking at the changes in the products' popularity.
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