5 Written Questions

1. A tradeoff between efficiency and fairness that recognizes the cost of making income transfers.
2. the ability of the economy to produce increasing quantities of goods and services
3. A measure of the responsiveness of quantity supplied to a price change; the percentage change in quantity supplied divided by the percentage change in price
4. a description of a person's likes and dislikes
5. All the objects that people value and produce to satisfy human wants

5 Matching Questions

1. Law of supply
2. Social Interest
3. Demand
4. Rent
5. Marginal benefit

1. a the principle that suppliers will normally offer more for sale at higher prices and less at lower prices
2. b the additional benefit to a consumer from consuming one more unit of a good or service
3. c the quantity of a good or service that consumers are willing and able to buy
4. d a regular payment by a tenant to a landlord for use of some property
5. e the choices that are best for society as a whole

5 Multiple Choice Questions

1. consumers buy more of a good when its price decreases and less when its price increases
   1. Law of demand
   2. Change in demand
   3. Land
   4. Labor
2. the branch of economics that studies the overall working of a national economy
   1. Incentive
   2. Money price
   3. Economics
   4. Macroeconomics
3. is a term that is used to describe the overall process of invention, innovation and diffusion of technology or processes
   1. Technological change
   2. Marginal cost
   3. Economics
   4. Relative price
4. Any commodity or token that is generally acceptable as a means of payment.
   1. Market
   2. Rent
   3. Wages
   4. Money
5. Cost of the next best alternative use of money, time, or resources when one choice is made rather than another
   1. Marginal Cost
   2. Normal good
   3. Opportunity cost
   4. Transactions costs

5 True/False Questions

1. Total surplus → consumer surplus + producer surplus

   True        False

2. Symmetry principle → people in similar situations should be treated similarly. This principle underlies the idea of equality of opportunity and the conclusion that fair rules lead to a fair outcome.

   True        False

3. Land → a regular payment by a tenant to a landlord for use of some property

   True        False

4. Relative price → the price at which the amount producers are willing to supply is equal to the amount consumers are willing to buy

   True        False

5. Incentive → a reason for doing something; something that stimulates action

   True        False