1.1 In a capitalist market economy, prices allocate resources equally among competing industries and sectors in the economy. True/False

1.2. If the equation for the demand curve is Q = 45 - 2P and the equation for the supply curve is Q = -21 + 4P, then the equilibrium value for the price is 23 and the quantity is 11. True/False

1.3. The producer surplus is the difference between the price that producers receive and the lowest prices at which they are willing to supply the different quantities. True/False

1.4. If a good is classified as an inferior good, it means that the quantity of the good that is demanded will decrease as income decreases. True/False

1.5. It is possible to make inter-personal comparisons of utility, that is, it is possible to compare the utility derived by two different consumers from the consumption of the same product (eg beef). True/False

1.6. The impact of a simultaneous decrease in demand and supply on the equilibrium quantity is impossible to predict. True/False

1.7. Product differentiation occurs when a firm produces many different goods. True/False

1.8. A monopolistic competitor is guaranteed an economic profit in the short run. True/False

1.9. If a firm in a perfectly competitive industry raises its price above market price sales will drop to zero. True/False