1. Economists are particularly adept at understanding that people respond to
c. punishments more than rewards.
2. Which is the most accurate statement about trade?
a. Trade can make every nation better off.
b. Trade makes some nations better off and others worse off.c. Trading for a good can make a nation better off only if the
3. Allocative efficiency is:
a. Using the very latest technology.
b. Distributing goods fairly.
c. Making goods as cheaply as possible.
4. A production possibilities frontier can shift outward if
a. government increases the amount of money in the economy.
b. there is no technological improvement.
c. the economy abandons inefficient production methods in favor of efficient production methods.
5. The price at which quantity supplied equals quantity demanded is called the
a. coordinating price.
b. monopoly price.
c. equilibrium price.
6. When the price of a good is higher than the equilibrium price,
a. a shortage will exist.
b. buyers desire to purchase more than is produced.
c. sellers desire to produce and sell more than buyers wish to purchase.
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