Microeconomics Quiz Chapter 5

When market prices are used to allocate resources, only the people who are able and willing to pay get the resources.

• True

• False

A boss telling a worker what to do is an example of a command system of allocating resources.

• True

• False

In the U.S. economy, resources are never allocated according to random chance.

• True

• False

In the U.S. economy, force is used as an allocation method force only for illegal activities such as theft.

• True

• False

Allocative efficiency occurs when it is not possible to produce more of one good without giving up the production of something else that is more highly valued.

• True

• False

The price of a product always equals its value.

• True

• False

The demand curve for tacos shows the maximum someone is willing to pay for the ten millionth taco.

• True

• False

As more of a product is consumed, its marginal benefit decreases.

• True

• False

Consumer surplus equals the area above the demand curve and below the market price.

• True

• False

Cost and price are the same thing.

• True

• False