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5 Written questions

5 Matching questions

  1. The fact that most medical care purchases are financed through insurance:
  2. If the demand for farm products is price inelastic, a good harvest will cause farm revenues to:
  3. The demand for autos is likely to be:
  4. Allocative efficiency is achieved when the production of a good occurs where:
  5. What do the income effect, the substitution effect, and diminishing marginal utility have in common?
  1. a decrease
  2. b P = MC.
  3. c They all help explain the downsloping demand curve.
  4. d increases the amount of health care consumed by reducing the price of additional units of care.
  5. e less price elastic than the demand for Honda Accords.

5 Multiple choice questions

  1. utility.
  2. economic profits earned by firms already in the industry.
  3. to firms in all types of industries.
  4. the price elasticity of demand is 2.25.
  5. relatively price inelastic.

5 True/False questions

  1. Under what conditions would an increase in demand lead to a lower long-run equilibrium price?The firms in the market are part of a decreasing-cost industry.


  2. Alex was willing to pay $50 for the new World Cup soccer ball. When he received it as a gift, he was willing to sell it, but for no less than $80. According to behavioral economists:utility.


  3. Because of "mental accounting:"to firms in all types of industries.


  4. Suppose a purely competitive, increasing-cost industry is in long-run equilibrium. Now assume that a decrease in consumer demand occurs. After all resulting adjustments have been completed, the new equilibrium price:and industry output will be less than the initial price and output.


  5. A supply curve that is a vertical straight line indicates that:a change in price will have no effect on the quantity supplied.


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