MICRO ECONOMICS NEW

   Scarcity can best be defined as 

• A Shortage of a product
• Where demand is greater than supply
• Unlimited wants vs Limited resources 
• Limited wants vs unlimited resources 

(3) Which of the following is NOT a consumer good?

• a bulldozer at a construction site
• a Happy Meal at McDonalds
• a pack of Doritos in a vending machine
• a television set for sale at an appliance store

(2) Which of the following resources would economists classify as “capital”?    

• Raw Bauxite in a South African mine 
• A hammer used in framing a house 
• A worker hired to repair engines 
• Trees used to make paper 

The law of demand states that

• consumers demand a larger quantity of a good when price is low.
• consumer demand increases when price is low.
• sellers supply a larger quantity of a good when price is high.
• sellers increase supply when price is high.

Movement along the Demand curve to the right is called

• decrease in demand
• decrease in quantity demanded
• increase in demand
• increase in quantity demanded

As the price of a good rises in a market, it acts as a signal:

• consumers that they should buy a greater quantity of the good.
• to producers that they should supply a greater quantity of the good.
• to consumer that they should increase their demand for the good.
• to producers that they should increase their supply of the good.

The ideal price and level of output occurs where

• Marginal Revenue and Marginal Cost cross
• MR = AVC
• Average Fixed Cost equal ATC
• MR = MT

A  point above the PPF curve represents

• efficiency
• inefficiency
• Unemployment
• Unattainable

When economists measure the responsiveness of consumers to changes in price, they are measuring:

• the percentage change in price
• the price elasticity of demand.
• the price elasticity of supply.
• income elasticity.

Organizers of many high-interest sporting events such as the Super Bowl and the World Series usually set ticket prices lower than the equilibrium price, citing fairness to the public as their reason. What names do economists give to the resulting set price and disequilibrium situation?

• price ceiling; surplus
• price ceiling; shortage
• price floor; shortage
• price floor; surplus