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ECO 213 Midterm Study Guide Questions with Answers 100% Verified Correct|
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ECO 213 Midterm Study Guide Questions with Answers 100% Verified Correct|
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ECO 213 Midterm Study Guide Questions withAnswers 100% Verified Correct|
Which of the following is true about the market equilibrium?
a. As the price increases, the quantity demanded and the quantity supplied increases.
b. As the price increases, the quantity demanded and the quantity supplied decreases.
c. As the price increases, the quantity demanded increases and the quantity supplied
decreases.
d. As the price increases, the quantity demanded decreases and the quantity supplied
increases.
e. As the price increases, neither the quantity demanded nor quantity supplied change. -
✔✔D. As the price increases, the quantity demanded decreases and the quantity
supplied increases.
Voluntary recycling is available in many parts of the country. If citizens of these areas
have collected recyclable material at home, they can bring it to a recycling center. These
materials reduce landfill space, reduce the need for virgin material extraction, and
provide an inexpensive input in many production processes. The information in this
question suggests what about areas without voluntary recycling?
a. Externalities exist.
b. There is mandatory recycling.
c. Raw materials are less expensive.
d. The cost of production is higher.
e. Nothing. - ✔✔E. Nothing.
To be valid, an economic model must:
a. include every activity which occurs in the real world.
, b. include at least 85 percent of the activity which occurs in the real world.
c. be able to predict events occurring in the real world.
d. exclude any link to the real world.
e. not be based on an abstraction of the real world. - ✔✔C. be able to predict events
occurring in the real world.
In Exhibit 2-17, if countries A and B currently have the same production possibilities
curve (PPC) as given in the figure, but this year country A locates at point A on its PPC
and country B locates at point B on its PPC, then country A:
a. is better off than country B.
b. will grow at a faster rate than country B.
c. will grow at a slower rate than country B.
d. is producing more capital goods than country B.
e. is more efficient than country B. - ✔✔C. will grow at a slower rate than country B.
When the price of a good in a market is above equilibrium:
a. the quantity supplied exceeds the quantity demanded.
b. a surplus is observed.
c. the price will fall in the near future.
d. all of the above. - ✔✔D. all of the above.
Nonsmoking sections in restaurants are designed to remove ____ from a market ____.
a. smoke; with food service
b. third parties; for food service
c. externalities; with public goods
d. third parties; externality
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