(1)"Markets are usually a good way to organize economic activities" is: (a)Principle#3 (b)Principle#5 (c)Principle#6 (d)Principle#9 (2)Which of the following statements about a glut in a market is false? (a)It results when the market demand for a good is less than its market supply (b)It results when the price of a good is set above its competitive equilibrium price (c)It results when the market demand for a good is greater than its market supply (d)All of the above (3)Which of the following questions is a microeconomics query? (a)Why are some countries rich and others poor? (b)What causes unemployment in a country? (c)Why is there a price difference for a cup of coffee in city A and city B? (d)What is the effect of technological innovations on economy wide productivity? (4)The theoretical principle which states that an increase in the price of a resource causes a decrease in the quantity demanded of the resource and vice versa is a description of the: (a)Law of Gravity (b)Law of Demand (c)Law of Supply (d)None of the above (5)The underlying assumption for the economic principle identified in Q#4 above to work is: (a)That consumers' incomes are changing (b)That government taxation policy is changing (c)Ceteris Paribus (d)That consumers are expecting that future prices will change (6)The slope of the demand curve that conforms to the theoretical principle that is described in Q#4 above is necessarily: (a)Direct (b)Horizontal (c)Inverse (d)None of the above

Figure#1 Demand and Supply Curves for I-Phones Price Per I-Phones Supply Curve for I-Phones 275 250 B 185 Demand Curve for I-Phones O 20 40 Quantity of I-Phones purchased (Dozens per week)Table#1-National Income Accounts SBillions National Income Accounts Consumption expenditures $1855 Interest 190 Corporate profit 150 Depreciation 200 Rent 70 Gross domestic investment 1250 Compensation of employees 830 Federal government expenditures 530 State government expenditures 235 Local government expenditures 140 Exports 220 Imports 270