51. Market competition pushes a price up towards its market-clearing price. Which of the following best describes that competition. A. Competition between buyers and seller B. Competition between buyers C. Competition between sellers D. Competition between sellers and the government

52. Economist explain that rationing A. is necessary because of scarcity B. occurs only when there are shortages C. is not necessary in a free market economy D. occurs only during times of war and national emergencies

53. Market-clearing Prices perform important tasks in a market economy. Which of the following is one of those tasks. A. provide incentives for producers to produce products for consumers B. ration goods and service C. Provide information about consumers wants D. All of the above

54. In a free enterprise economy, a market-clearing price is determined by A. voluntary exchanges among buyers and sellers B. the government C. the courts D. big businesses

55. Suppose the government keeps the price of ice cream way below its market clearing price. Which result would be most likely in a market economy. A. Ice cream producers would have less incentive to produce ice cream B. Price would have a smaller role in rationing a the amount of ice cream available C. Consumers would have incorrect information about the scarcity of ice cream D. All of the above

56. In a free enterprise economy, how do consumers signal businesses that they want more of a product A. they increase the products supply B. the urge the government to pass a law requiring businesses to increase production C. they complain to the news media D. they bid up the product's price

57. When demand and supply are equal for a product A. the item is not scarce B. the product's price falls C. the market is cleared D. all of the above

58. In economics a shortage of a product means A. that people want it buy more of it than they need B. The same thing as a scarcity of a product C. That businesses are not producing it efficiently D. The item's price is below its market-clearing price

59. Bad weather in coffee-growing countries reduces the worlds supply of coffee and raises its Market-clearing price. In response consumers give the extra cups of coffee they value less than the higher price. Some even stop drinking coffee. This event illustrates A. how a free enterprise economy determines who will receive the goods and services produced B. how a market economy rations goods and services C. Both A and B D. Neither A nor B

60. From time to time, water shortages have occurred during times of drought. Meanwhile, motorists encounter shortages of roadways everyday as they inch along in congested traffic. According to economics, these shortages occurred because A. water and highways are necessities B. water and highways are scarce C. there is no way to balance the demand and supply for both of these things D. people usually don't pay market-clearing prices.