ECO212 - Part I Multiple Choice(1.5 points each Bold and...

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Part I – Multiple Choice (1.5 points each) Bold and Color the correct answer. There is only one correct answer for each MC question. 1. Which of the following questions is not answered by the decisions that every society must make? a.What determines consumer preferences? b.What goods will be produced? c.Who will produce the goods? d.Who will consume the goods? 2. The phenomenon of scarcity stems from the fact that a.most economies’ production methods are not very good. b.in most economies, wealthy people consume disproportionate quantities of goods and services. c.governments restricts production of too many goods and services. d.resources are limited. 3. Which of the following statements best represents the principle represented by the adage, "There is no such thing as a free lunch"? a.Melissa can attend the concert only if she takes her sister with her. b.Greg is hungry and homeless. c.Brian must repair the tire on his bike before he can ride it to class.
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d.Kendra must decide between going to Colorado or Cancun for spring break. 4. Mallory decides to spend three hours working overtime rather than watching a video with her friends. She earns $8 an hour. Her opportunity cost of working is a.the $24 she earns working. b.the $24 minus the enjoyment she would have received from watching the video. c.the enjoyment she would have received had she watched the video. d.nothing, since she would have received less than $24 of enjoyment from the video. 5. In a market economy, a.supply determines demand and, in turn, demand determines prices. b.demand determines supply and, in turn, supply determines prices. c.the allocation of scarce resources determines prices and, in turn, prices determine supply and demand. d.supply and demand determine prices and, in turn, prices allocate scarce resources. 6. Which of the following statements is correct? a.Buyers determine supply and sellers determine demand. b.Buyers determine demand and sellers determine supply. c.Buyers and sellers as one group determine supply, but only buyers determine demand. d.Buyers and sellers as one group determine demand, but only sellers determine supply. 7. In a competitive market, each seller has limited control over the price of his product because 2
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a.other sellers are offering similar products. b.buyers exert more control over the price than do sellers. c.these markets are highly regulated by government. d.sellers usually agree to set a common price that will allow each seller to earn a comfortable profit. 8. For a competitive market, which of the following statements is correct? a.A seller can always increase her profit by raising the price of her product. b.If a seller charges more than the going price, buyers will go elsewhere to make their purchases. c.A seller often charges less than the going price to increase sales and profit.
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This note was uploaded on 06/10/2011 for the course ECON 2301 taught by Professor Davis during the Spring '11 term at Texas Southern.

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ECO212 - Part I Multiple Choice(1.5 points each Bold and...

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