Someone notices that sunspot activity is high just prior to recessions and concludes that sunspots cause recessions. This person has:
A. confused association and causation.
B. misunderstood the Ceteris paribus assumption.
C. used normative economics to answer a positive question.
D. built an untestable model.
Answer: A
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If the minimum wage is set above the market wage
A) unemployment will rise. B) the quantity of labor supplied will be below the quantity of labor demanded. C) highly-skilled workers will have a harder time finding jobs. D) All of the above are correct.
Which of the following statements is false?
A) Asymmetric information can exist both before and after a transaction. B) Moral hazard occurs when one party to a transaction changes his or her behavior in a way that is hidden from and costly to the other party. C) Adverse selection has the potential to eliminate some markets. D) none of the above
The market demand curve for most goods and services is
A. the horizontal summation of individual demand curves. B. calculated by multiplying all individual demand curves by each other. C. not important for most analytical purposes. D. not related in any way to individual demand curves.
Suppose a monopolist faces the demand curve shown below. 
If the monopolist were to sell 20 units of output, its total revenue would be:
A. $1,000. B. $50. C. $100. D. $140.