Q1) An inferior good is defined as a good for which demand decreases when:
the price increases
income increases
the price decreases
income increases
Q2) Assumethat compact discs and compact disc players are complements. When the price of compact disc players decreases:
the demand for compact discs increases
the demand for compact discs decreases
the supply of impact discs increases
the supply of compact discs decreases
Q3) If we observe that the price is rising in the sugar market, it could be due to:
an excess supply of sugar
an excess demand for sugar
an increase in the supply of sugar
a decrease in the demand for sugar
Q4) Suppose that there are only three consumers of a product. At a price of $3 per unit, the first consumer would buy 6 units of the product, the second consumer would buy 5 units, and the third consumer would buy 7 units of the product. If you drew a market demand curve for this product, the quantity demanded at a price of $3 would be:
18 units
11 units
13 units
Unable to be determined based on the information provided
Q5) Which of the following statements about fixed costs is correct?
Fixed costs are not opportunity costs
Fixed costs must be paid even if the firm’s output is zero
Fixed costs are always the largest portion of total costs
None of the above
Q6) The additional cost resulting from a small increase in some activity is called the ____
Opportunity cost
Marginal benefit
Marginal cost
Diminishing returns of the activity
Q7)Indicate whether the statement is true or false
In response to concerns about levels of indebtedness, if households increase precautionary saving, then withdrawals from the circular flow of income will increase.
True
False
Q8) Which of the following is a topic not directly under macroeconomics?
{Choose your answer, only one answer is correct.}
Inflation
Recessions
Why the price of crude oil is high
All of the above are topics in macroeconomics
Q9)Indicate whether the statement is true or false
If consumers demand for more goods that are domestically produced but total consumption does not change; then, withdrawals from the circular flow of income will decrease
True
False
Q10) Indicate whether the statement is true or false
When firms are anticipating a rise in consumer demand, borrow more money in order to build up their stock, the injections into the circular flow of income will increase.
True
False
