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ECO 213 Midterm Study Guide exam with complete solutions 2024_2025
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ECO 213 Midterm Study Guide exam with complete solutions 2024_2025
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ECO 213 Midterm Study Guide exam withcomplete solutions 2024/2025
Scarcity means we are unable to have as much as we would like to have.
a. True
b. False - ANSWER-False
When making a rational decision which requires the consideration of costs and
benefits involved, the opportunity cost of a decision is often not taken into
consideration when indeed it should be.
a. True
b. False - ANSWER-True
If X and Y are substitutes, the demand curve for X will shift to the right when the
price of Y decreases.
a. True
b. False - ANSWER-False
Using supply and demand analysis, customers will stand in line for gasoline
when a price ceiling is in force, even if the price ceiling is at a level higher than
the equilibrium price.
a. True
b. False - ANSWER-False
Macroeconomics is the branch of economics that studies economic aggregates
for the economy as a whole.
a. True
b. False - ANSWER-True
, When making a rational decision which requires the consideration of costs and
benefits involved, the opportunity cost of a decision is often not taken into
consideration when indeed it should be.
a. True
b. False - ANSWER-True
Suppose A and B are complementary goods. Other things being equal, the
demand curve for A will shift to the right when the price of B goes up.
a. True
b. False - ANSWER-False
Assume a price floor is set above the equilibrium price. The result is a surplus.
a. True
b. False - ANSWER-True
A good economic model should capture as many details about real-world
behavior as possible.
a. True
b. False - ANSWER-False
If some resources went to waste rather to use in production, the economy would
operate outside its production possibility curve.
a. True
b. False - ANSWER-False
Equilibrium in a market exists when there is neither a surplus nor a shortage of
the item.
a. True
b. False - ANSWER-True
Public goods are overproduced in the marketplace.
a. True
b. False - ANSWER-False
The observation that interest rates are higher in years ending with a 1 or a 6
represents causality rather than association.
a. True
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