Exam 4: The Market System and the Private and Public Sector

The market process by which new products and new firms replace existing products and firms is called:

The figure given below represents the equilibrium price and output in the market for restaurant meals and delivery meals. Figure 4.1 -Refer to Figure 4.1. Identify the impact on the price of Restaurant Meals and Delivery Meals following the direction of the shifts in demand in these two industries.

Which of the following is true of investment spending in the U.S. economy?

'Walkmans' that played audio cassettes were withdrawn from the market by Sony Corporations soon after MP3 players became popular among consumers. Which of the following factors is most likey to have led to this outcome?

The figure given below represents the equilibrium price and output in the market for restaurant meals and delivery meals. Figure 4.1 -Refer to Figure 4.1. If the price in the Delivery Meals market remains at $10 but demand shifts to D2 which of the following situations will be observed?

The public sector of the U.S. economy includes:

Which of the following is true of the U.S. government?

An enterprise that has only one shareholder does not constitute a corporation.

An unmarried couple holding joint title to their condominium constitutes a household.

An import is defined as:

According to the World Development Report published by the World Bank, developing countries greatly outnumber industrial countries.

Financial intermediaries are best described as:

The figure given below represents the circular flow of income between households, firms, financial intermediaries, and foreign countries. Figure 4.2 -Refer to Figure 4.2. Suppose households reduce saving to $7,000. Everything else held constant, consumption spending must now be:

In a market system, which of the following factors determines a consumers's ability to pay for a good or service?

Since the U.S. is organized as a market economy, the government sector does not play a role in economic activity.

Which of the following correctly describes the market-clearing price?

The circular flow of income model shows that, if households and firms were the only two sectors in the economy, then:

When a household owns shares of stock:

A person obtains income is obtained by selling the services of the resources that he or she owns.

Empirical evidence on the U.S. economy suggests that household spending and income have an inverse relationship.