Which of the following is a positive statement?

New tax laws are needed to help the poor.

Teenage unemployment should be reduced.

We should increase Social Security payments to older adults.

An increase in tax rates will reduce unemployment.

It is only fair that firms protected from competition by government-granted

monopolies pay higher corporate taxes.

Which of the following is true?

The intersection of the supply and demand curves shows the equilibrium price and

equilibrium quantity in a market.

A surplus is a situation where quantity supplied exceeds quantity demanded.

A shortage is a situation where quantity demanded exceeds quantity supplied.

Shortages and surpluses set in motion actions by many buyers and sellers that will

move the market toward the equilibrium price and quantity unless otherwise

prevented.

All of these are true.

A current surplus is due to a price floor. If the price floor is removed, ______.

price would increase, quantity demanded would increase, and quantity supplied

would increase

price would increase, quantity demanded would decrease, and quantity supplied

would decrease

price would decrease, quantity demanded would increase, and quantity supplied

would decrease

price would decrease, quantity demanded would decrease, and quantity supplied

would increase

The longer a price ceiling is left below the equilibrium price in a market, the ______ reduction in the quantity exchanged and the ______ resulting deadweight loss.

greater; greater

greater; smaller

smaller; greater

smaller; smaller

The amount of information that is necessary to make an efficient choice is generally ______ in the public sector than in the private sector.

a. less b. more c. the same d. None of the above is true.

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If a firms ATC is falling in the long run, then ______.

it is subject to economies of scale over that range of output

it is subject to diseconomies of scale over that range of output

it is subject to constant return to scale over that range of output

it has reached the minimum efficient scale of production

both it is subject to constant return to scale over that range of output and it has

reached the minimum efficient scale of production are true

Which of the following is true?

Productive efficiency occurs in perfect competition because the firm produces at

the minimum of the ATC curve.

Allocative efficiency occurs when P = MC; production is allocated to reflect

consumers wants.

Both Productive efficiency occurs in perfect competition because the firm produces

at the minimum of the ATC curve and Allocative efficiency occurs when P = MC;

production is allocated to reflect consumers wants are true.

None of these is true.

In game theory ______.

there is not always a dominant strategy

a Nash equilibrium is a dominant strategy

collusion is an example of a cooperative game

all of these

An increase in the demand for land will ______.

increase the price of land and increase the quantity of land supplied

increase the price of land but not change the quantity of land supplied

increase the quantity of land supplied but not change the price of land

do none of the preceding

If a is cheaper in terms of a foreign currency than the equilibrium exchange rate, a ______

exists at the current exchange rate that will put ______ pressure on the exchange value of a .

surplus of ; downward

surplus of ; upward

shortage of ; downward

shortage of ; upward

11. The statement the government should increase spending for the space program is ______.

objective and testable

a positive statement

subjective, prescriptive, and normative

a fact and very important for the defence of our country

A current shortage is due to a price ceiling. If the price ceiling is removed, ______.

price would increase, quantity supplied would increase, and quantity demanded

would decrease

price would increase, quantity supplied would decrease, and quantity demanded

would increase

price would decrease, quantity supplied would increase, and quantity demanded

would decrease

price would decrease, quantity supplied would decrease, and quantity demanded

would increase

Adverse selection refers to ______.

the phenomenon that occurs when one party in an exchange takes advantage of

knowing more than another party

the tendency for individuals to alter their behaviour once they are insured against

loss

the tendency for individuals to engage in insurance fraud

both the tendency for individuals to alter their behaviour once they are insured

against loss and the tendency for individuals to engage in insurance f

When

long-run average total cost declines as output expands

long-run average total cost increases as output expands

marginal cost increases as output expands

the marginal product of an input diminishes with increased utilization

Which of the following is not true of successful price discriminators?

They could make greater profits by charging everyone a higher, uniform price.

Their customers must differ in their willingness to pay.

Their customers must have difficulty reselling the good to other customers.

They must have monopoly power.

a firm experiences economies of scale in production, ___