Question 1

​Figure 5.2. The figure shows the supply and demand curves of a firm.  
-​What do you mean by the term 'market process'?

Accepted Answer

A) ​It refers to the way that scarce goods and services are allocated through individual actions and self-interest of buyers and sellers. 
B) ​It refers to the way that scarce resources are allocated by a government to firms that value them the most. 
C) ​It refers to the way in which markets adjust to changes in demand and supply. 
D) ​It refers to a system in which goods and services are exchanged through transactions by private households and firms. 
E) ​It refers to a way in which final goods and services are distributed to potential consumers. 
A) ​It refers to the way that scarce goods and services are allocated through individual actions and self-interest of buyers and sellers. 
B) ​It refers to the way that scarce resources are allocated by a government to firms that value them the most. 
C) ​It refers to the way in which markets adjust to changes in demand and supply. 
D) ​It refers to a system in which goods and services are exchanged through transactions by private households and firms. 
E) ​It refers to a way in which final goods and services are distributed to potential consumers.

Question 2

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market.  
-Refer to figure 5.3. If people refuse to offer labor unless they receive a wage higher than the equilibrium wage​, then:

Accepted Answer

A) ​there will be a shift in the equilibrium point. 
B) ​the quantity of labor demanded will increase from Q to QII. 
C) ​the quantity of labor demanded will fall from Q to QI. 
D) ​the wage rate will move up, from $6 to $8. 
E) ​the wage rate will fall from $6 to $4. 
A) ​there will be a shift in the equilibrium point. 
B) ​the quantity of labor demanded will increase from Q to QII. 
C) ​the quantity of labor demanded will fall from Q to QI. 
D) ​the wage rate will move up, from $6 to $8. 
E) ​the wage rate will fall from $6 to $4.

Question 3

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market.  
-Medicare subsidizes or provides health care to the poor and medicaid provides health care to the elderly.​

Accepted Answer

A) True 
 B)False

Question 4

​Figure 5.2. The figure shows the supply and demand curves of a firm.  
-Which of the following statements is true?​

Accepted Answer

A) ​The intention of a minimum wage is to raise the wage rate for the skilled workers. 
B) ​The lowest of the federal or state minimum wage levels prevails in each state. 
C) ​The federal minimum wage, in the United States, is followed by all the states as their minimum wage. 
D) ​The minimum wage has the greatest impact on the unskilled labor market. 
E) ​The minimum wage has the greatest impact on the skilled labor market. 
A) ​The intention of a minimum wage is to raise the wage rate for the skilled workers. 
B) ​The lowest of the federal or state minimum wage levels prevails in each state. 
C) ​The federal minimum wage, in the United States, is followed by all the states as their minimum wage. 
D) ​The minimum wage has the greatest impact on the unskilled labor market. 
E) ​The minimum wage has the greatest impact on the skilled labor market.

Question 5

​Figure 5.2. The figure shows the supply and demand curves of a firm.  
-A wage that allows people to pay for the necessities of life is known as a(n):​

Accepted Answer

A) ​equilibrium wage. 
B) ​minimum wage. 
C) ​living wage. 
D) ​fair wage. 
E) ​subsistence wage. 
A) ​equilibrium wage. 
B) ​minimum wage. 
C) ​living wage. 
D) ​fair wage. 
E) ​subsistence wage.

Question 6

Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries​.  
-The phrase in the text, 'human beings are self-interested, not selfish' means that:

Accepted Answer

A) people are never selfish. 
B) people never act in a spiteful or belligerent manner. 
C) people never act in a fit of rage. 
D) people contribute to charities and they help others. 
E) people care only about themselves and their families. 
A) people are never selfish. 
B) people never act in a spiteful or belligerent manner. 
C) people never act in a fit of rage. 
D) people contribute to charities and they help others. 
E) people care only about themselves and their families.

Question 7

Scenario 4-1
In a given year, country A exported $12 million worth of goods to country B and $6 million worth of goods to country C; country B exported $4 million worth of goods to country A and $7 million worth of goods to country C; and country C exported $5 million worth of goods to country A and $2 million worth of goods to country B.
-Which of the following will possibly cause a leftward shift in the production possibility curve, representing good X and good Y?​

Accepted Answer

A) ​A decrease in a country's GDP 
B) ​An increase in the price of good X 
C) ​An increase in the price of good Y 
D) ​A decrease in the price of good Y 
E) ​A decrease in the price of good X 
A) ​A decrease in a country's GDP 
B) ​An increase in the price of good X 
C) ​An increase in the price of good Y 
D) ​A decrease in the price of good Y 
E) ​A decrease in the price of good X

Question 8

Scenario 4-1
In a given year, country A exported $12 million worth of goods to country B and $6 million worth of goods to country C; country B exported $4 million worth of goods to country A and $7 million worth of goods to country C; and country C exported $5 million worth of goods to country A and $2 million worth of goods to country B.
-Which of the following is true?​

Accepted Answer

A) ​Economists assume that there are no private property rights in a free market. 
B) ​A free market is also known as a fettered market. 
C) ​A voluntary transaction means that all parties to the transaction must expect to benefit. 
D) ​People always receive goods and services at a discounted price in a free market. 
E) ​An economic growth is represented by an inward shift of the production possibility curve. 
A) ​Economists assume that there are no private property rights in a free market. 
B) ​A free market is also known as a fettered market. 
C) ​A voluntary transaction means that all parties to the transaction must expect to benefit. 
D) ​People always receive goods and services at a discounted price in a free market. 
E) ​An economic growth is represented by an inward shift of the production possibility curve.

Question 9

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market.  
-One of the drawbacks of horizontal fracking is that it drew workers from other industries to the fracking industry.​

Accepted Answer

A) True 
 B)False

Question 10

Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries​.  
-​Refer to figure 5.1. Under which of the following conditions, would the residents of the country choose to consume luxury goods?

Accepted Answer

A) ​When there is an increase in the price of luxury goods 
B) ​When there is a decrease in the prices of inferior goods 
C) ​When there is an increase in the prices of goods that are necessities 
D) ​When there is an increase in the per capita income of households 
E) ​When there is a decrease in the per capita income of households 
A) ​When there is an increase in the price of luxury goods 
B) ​When there is a decrease in the prices of inferior goods 
C) ​When there is an increase in the prices of goods that are necessities 
D) ​When there is an increase in the per capita income of households 
E) ​When there is a decrease in the per capita income of households

Question 11

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market.  
-Refer to figure 5.3. The surplus or unemployment in the labor market is represented by:​

Accepted Answer

A) ​a rightward shift in the labor demand curve. 
B) ​a fall in price from $6 to $4. 
C) ​the distance between QII and Q. 
D) ​the distance between Q and QI. 
E) ​the distance between the points A and B. 
A) ​a rightward shift in the labor demand curve. 
B) ​a fall in price from $6 to $4. 
C) ​the distance between QII and Q. 
D) ​the distance between Q and QI. 
E) ​the distance between the points A and B.

Question 12

​Figure 5.2. The figure shows the supply and demand curves of a firm.  
-Which of the following is true?​

Accepted Answer

A) ​If minimum wage is set below the equilibrium wage, it leads to a labor surplus. 
B) ​If anything interferes with the voluntary exchanges that make up a market, equilibrium does not occur. 
C) ​Minimum wage helps deal with the problem of unemployment in the market for unskilled labor. 
D) ​Producers are willing to employ more labor at a minimum wage. 
E) ​Minimum wage leads to a situation of labor deficit in a market. 
A) ​If minimum wage is set below the equilibrium wage, it leads to a labor surplus. 
B) ​If anything interferes with the voluntary exchanges that make up a market, equilibrium does not occur. 
C) ​Minimum wage helps deal with the problem of unemployment in the market for unskilled labor. 
D) ​Producers are willing to employ more labor at a minimum wage. 
E) ​Minimum wage leads to a situation of labor deficit in a market.

Question 13

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market.  
-Hydraulic fracking involves pumping millions of gallons of chemically treated water into the wells at pressures of 9,000 pounds per square inch or more.​

Accepted Answer

A) True 
 B)False

Question 14

Scenario 4-1
In a given year, country A exported $12 million worth of goods to country B and $6 million worth of goods to country C; country B exported $4 million worth of goods to country A and $7 million worth of goods to country C; and country C exported $5 million worth of goods to country A and $2 million worth of goods to country B.
-What do you mean by the term 'free market'?​

Accepted Answer

A) ​It refers to the process whereby buyers and sellers interact or trade under government regulation. 
B) ​It refers to the process whereby buyers and sellers voluntarily interact or trade without any interference or restrictions. 
C) ​It refers to a market where buyers and sellers pay for goods and services in kind and not in cash. 
D) ​It refers to a market where assets are traded after they have been sold in the primary market. 
E) ​It refers to a market where the demand for the product being traded is not affected by a change in the price of the product. 
A) ​It refers to the process whereby buyers and sellers interact or trade under government regulation. 
B) ​It refers to the process whereby buyers and sellers voluntarily interact or trade without any interference or restrictions. 
C) ​It refers to a market where buyers and sellers pay for goods and services in kind and not in cash. 
D) ​It refers to a market where assets are traded after they have been sold in the primary market. 
E) ​It refers to a market where the demand for the product being traded is not affected by a change in the price of the product.

Question 15

​Figure 5.2. The figure shows the supply and demand curves of a firm.  
-Which of the following is a possible cause of a rightward shift in the supply of healthcare?​

Accepted Answer

A) ​A fall in the price of resources used to produce healthcare products 
B) ​An increase in the price of resources used to produce healthcare products 
C) ​A fall in the profit expectations of healthcare providers 
D) ​A fall in the number of suppliers of healthcare 
E) ​An expectation of an increase in the price of healthcare products in future 
A) ​A fall in the price of resources used to produce healthcare products 
B) ​An increase in the price of resources used to produce healthcare products 
C) ​A fall in the profit expectations of healthcare providers 
D) ​A fall in the number of suppliers of healthcare 
E) ​An expectation of an increase in the price of healthcare products in future

Question 16

​Figure 5.2. The figure shows the supply and demand curves of a firm.  
-Which of the following is true with regard to minimum wages?​

Accepted Answer

A) ​A minimum wage does little to alleviate poverty. 
B) ​A minimum wage helps deal with the problem of poverty. 
C) ​A minimum wage leads to a surplus or unemployment in the skilled labor market. 
D) ​A minimum wage adversely affects the unskilled laborers between the age group 40 and 45. 
E) ​A minimum wage helps provide employment to teenagers and improve their standard of living. 
A) ​A minimum wage does little to alleviate poverty. 
B) ​A minimum wage helps deal with the problem of poverty. 
C) ​A minimum wage leads to a surplus or unemployment in the skilled labor market. 
D) ​A minimum wage adversely affects the unskilled laborers between the age group 40 and 45. 
E) ​A minimum wage helps provide employment to teenagers and improve their standard of living.

Question 17

​Figure 5.2. The figure shows the supply and demand curves of a firm.  
-Which of the following is the purpose of a minimum wage?​

Accepted Answer

A) ​To reduce the wage rates of high-income workers 
B) ​To keep a track of the changes in the wage rate in an unskilled labor market 
C) ​To deal with the problem of unemployment in the market 
D) ​To help increase the profits earned by the producers 
E) ​To raise the wage rate for the lowest income workers 
A) ​To reduce the wage rates of high-income workers 
B) ​To keep a track of the changes in the wage rate in an unskilled labor market 
C) ​To deal with the problem of unemployment in the market 
D) ​To help increase the profits earned by the producers 
E) ​To raise the wage rate for the lowest income workers

Question 18

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market.  
-Sellers are more willing to supply a good or service for which the profit is low than to supply a good or service for which the profit is high.

Accepted Answer

A) True 
 B)False

Question 19

​Figure 5.2. The figure shows the supply and demand curves of a firm.  
-Which of the following statements about health care is true?​

Accepted Answer

A) ​The demand for health care is inversely related to price. 
B) ​The demand for health care is positively related to price. 
C) ​Healthcare is an inferior good. 
D) ​Health care and health insurance is only provided by the government in the U.S. 
E) ​The supply of health care is inversely related to price. 
A) ​The demand for health care is inversely related to price. 
B) ​The demand for health care is positively related to price. 
C) ​Healthcare is an inferior good. 
D) ​Health care and health insurance is only provided by the government in the U.S. 
E) ​The supply of health care is inversely related to price.

Question 20

​Figure 5.2. The figure shows the supply and demand curves of a firm.  
-Which of the following statements is true?​

Accepted Answer

A) ​Over time, when demand for health care continues to rise relatively more than supply, the cost of health care falls. 
B) ​Over time, when demand for health care continues to rise relatively more than supply , the cost of health care continues to rise. 
C) ​An increase in the demand for health care is accompanied by an outward shift in the supply curve. 
D) ​The price of health care rises either with a fall in demand or an increase in supply. 
E) ​The change in the demand for health care with no change in supply causes the price to fall continuously. 
A) ​Over time, when demand for health care continues to rise relatively more than supply, the cost of health care falls. 
B) ​Over time, when demand for health care continues to rise relatively more than supply , the cost of health care continues to rise. 
C) ​An increase in the demand for health care is accompanied by an outward shift in the supply curve. 
D) ​The price of health care rises either with a fall in demand or an increase in supply. 
E) ​The change in the demand for health care with no change in supply causes the price to fall continuously.

Figure 5.2. The figure shows the supply and demand curves of a firm. -What do you mean by the term 'market process'?

Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Refer to figure 5.3. If people refuse to offer labor unless they receive a wage higher than the equilibrium wage, then:

Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Medicare subsidizes or provides health care to the poor and medicaid provides health care to the elderly.

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following statements is true?

Figure 5.2. The figure shows the supply and demand curves of a firm. -A wage that allows people to pay for the necessities of life is known as a(n):

Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries. -The phrase in the text, 'human beings are self-interested, not selfish' means that:

Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries. -Refer to figure 5.1. Under which of the following conditions, would the residents of the country choose to consume luxury goods?

Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Refer to figure 5.3. The surplus or unemployment in the labor market is represented by:

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is true?

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is a possible cause of a rightward shift in the supply of healthcare?

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is true with regard to minimum wages?

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is the purpose of a minimum wage?

Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Sellers are more willing to supply a good or service for which the profit is low than to supply a good or service for which the profit is high.

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following statements about health care is true?

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following statements is true?

The Wealth of Nations: Ownership and Economic Freedom

Scarcity and Opportunity Costs

Markets and the Price System

The Aggregate Economy

Elasticity: Demand and Supply

Demand: Consumer Choice

Supply: the Costs of Doing Business

Profit Maximization

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Markets and Government

Antitrust and Regulation

Resource Markets

The Labor Market

The Capital Market

The Land Market and Natural Resources

Current Issues: Income, Income Distribution, Poverty, and Government Policy

World Trade Equilibrium

International Trade Restrictions

Exchange Rates and Financial Links Between Countries

Filters

Exam 5: Using Economics to Understand the World Around You

​Figure 5.2. The figure shows the supply and demand curves of a firm. -​What do you mean by the term 'market process'?

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Refer to figure 5.3. If people refuse to offer labor unless they receive a wage higher than the equilibrium wage​, then:

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Medicare subsidizes or provides health care to the poor and medicaid provides health care to the elderly.​

​Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following statements is true?​

​Figure 5.2. The figure shows the supply and demand curves of a firm. -A wage that allows people to pay for the necessities of life is known as a(n):​

Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries​. -The phrase in the text, 'human beings are self-interested, not selfish' means that:

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -One of the drawbacks of horizontal fracking is that it drew workers from other industries to the fracking industry.​

Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries​. -​Refer to figure 5.1. Under which of the following conditions, would the residents of the country choose to consume luxury goods?

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Refer to figure 5.3. The surplus or unemployment in the labor market is represented by:​

​Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is true?​

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Hydraulic fracking involves pumping millions of gallons of chemically treated water into the wells at pressures of 9,000 pounds per square inch or more.​

​Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is a possible cause of a rightward shift in the supply of healthcare?​

​Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is true with regard to minimum wages?​

​Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is the purpose of a minimum wage?​

​Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Sellers are more willing to supply a good or service for which the profit is low than to supply a good or service for which the profit is high.

​Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following statements about health care is true?​

​Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following statements is true?​

The Wealth of Nations: Ownership and Economic Freedom

Scarcity and Opportunity Costs

Markets and the Price System

The Aggregate Economy

Elasticity: Demand and Supply

Demand: Consumer Choice

Supply: the Costs of Doing Business

Profit Maximization

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Markets and Government

Antitrust and Regulation

Resource Markets

The Labor Market

The Capital Market

The Land Market and Natural Resources

Current Issues: Income, Income Distribution, Poverty, and Government Policy

World Trade Equilibrium

International Trade Restrictions

Exchange Rates and Financial Links Between Countries

Filters

Figure 5.2. The figure shows the supply and demand curves of a firm. -What do you mean by the term 'market process'?

Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Refer to figure 5.3. If people refuse to offer labor unless they receive a wage higher than the equilibrium wage, then:

Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Medicare subsidizes or provides health care to the poor and medicaid provides health care to the elderly.

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following statements is true?

Figure 5.2. The figure shows the supply and demand curves of a firm. -A wage that allows people to pay for the necessities of life is known as a(n):

Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries. -The phrase in the text, 'human beings are self-interested, not selfish' means that:

Figure 5.1. The figure shows a linear production possibility curve representing a tradeoff faced by a country, between necessities and luxuries. -Refer to figure 5.1. Under which of the following conditions, would the residents of the country choose to consume luxury goods?

Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Refer to figure 5.3. The surplus or unemployment in the labor market is represented by:

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is true?

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is a possible cause of a rightward shift in the supply of healthcare?

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is true with regard to minimum wages?

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following is the purpose of a minimum wage?

Figure 5.3. The figure shows the wage rate and the quantity of labor supplied in an unskilled labor market. -Sellers are more willing to supply a good or service for which the profit is low than to supply a good or service for which the profit is high.

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following statements about health care is true?

Figure 5.2. The figure shows the supply and demand curves of a firm. -Which of the following statements is true?