The relationship between quantity demanded and price is a(n) ________ relationship.
A. general
B. inverse
C. dictated
D. direct
Answer: B
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Which of the following is correct about the economic decisions consumers, firms, and the government have to make?
A) Each faces the problem of scarcity which necessitates trade-offs in making economic decisions. B) Governments may face the problem of shortages but not scarcity in making economic decisions. C) Firms and the government face scarcity, individuals only face shortages. D) Only individuals face scarcity; firms and the government do not.
Which of the following statements is TRUE?
a. Average cost (AC) is irrelevant to extent decisions b. Average cost determines how much you produce c. Marginal cost (MC) is irrelevant to extent decisions d. All of the above
The marginal productivity theory of distribution holds that
a. each factor is paid what it deserves. b. the owner of each factor is paid the amount that the factor contributes to earnings. c. each factor's income depends on how hard it works. d. each factor receives an equal share of the revenue from production.
We are given the individual demand curves for all of the people that consume ice cream. Which statement is TRUE about the market demand curve for ice cream?
A) The market demand curve is obtained by horizontally summing the individual demand curves. B) The market demand curve is obtained by vertically summing the individual demand curves. C) The market demand curve cannot be obtained because information on prices is missing. D) The market demand curve cannot be obtained from individual demand curves.