True/False Econ
All of the choices on the production possibilities frontier are equally desirable.
False
Both the supply and demand curves depend on expectations but the supply curve depends on the expectations of the seller.
False
If the market price of Beanie Babies increases, then the supply curve of Beanie Babies will shift to the right.
False
In a market economy, prices are determined by the consumer; in a planned or command economy, prices are determined by the seller.
False
It is impossible to have a conflict between allocative efficiency and productive efficiency.
False
Land, labor, capital, and entrepreneurship are bought and sold in the product market.
False
Market price is the same thing as equilibrium price.
False
Mathematically, the law of demand refers to the positive relationship between price and quantity demanded.
False
Normative and positive questions are basically involving the understanding of basic facts.
False
Output combinations that lie inside the production-possibilities frontier are characterized by efficient use of resources.
False
Technological advance shifts the production possibilities frontier inward.
False
The choice to attend a free college lecture involves absolutely no opportunity cost.
False
When a seller sells a good, the supply curve shifts to the right.
False
A decrease in the level of resource utilization would bring about an inward shift of a PPF.
True
According to the law of supply, if the price of calculators decreased, the supply of calculators would decrease, ceteris paribus.
True
All output combinations that lie outside a production-possibilities frontier are unattainable with available resources and technology.
True
An increase in the price of one good can cause the demand for another good to decrease if the goods are complements.
True
Another term for market economy is capitalistic economy.
True
Education and training are an example of investment in human capital.
True
Goods are scarce because society's desire for them exceeds society's ability to produce them.
True
Government regulations, taxes, and subsidies affect the mix of output in the economy.
True
If a price ceiling is set above the market price, it is ineffective.
True
One reason that buyers purchase less of a product when its price rises is that they switch to substitute items
True
Price signals direct the answers to the what, how and for whom questions in a laissez-faire economy.
True
Price signals direct the answers to the what, how, and for whom questions in a laissez-faire economy.
True
The demand schedule and demand curve remain unchanged only so long as the underlying determinants of demand remain constant.
True
The market price equals the equilibrium price if quantity demanded equals quantity supplied, at the market price.
True
There are never shortages or surpluses when the price in a market is equal to the equilibrium price for the market.
True
Thinking at the margin is defined as maximizing a firm's or individual's well-being.
True
When a factory pollutes the air we breathe in a market economy, this situation is known in economics as market failure.
True
When a scarce good or resource is consumed by a person who does not value it most, economists refer to the situation as a misallocation of resources.
True
When imports are larger than exports, the value of net exports is negative.
True
When individual supply curves shift, ceteris paribus, the market supply curve shifts.
True
When the number of buyers in a market changes, the market demand curve for goods and services also changes, even if individual demand curves do not shift.
True
