Economics Quiz

In a market where there is excess supply, what will the prices do over time?

• Increase

• Decrease

• Remain constant

• Fluctuate randomly

What function of prices is indicated when consumers want to buy a greater quantity?

• Allocative

• Incentive

• Signalling

• Rationing

In a market where there is excess demand, what will the prices do over time?

• Increase

• Decrease

• Remain constant

• Fluctuate randomly

What is the function of prices when producers are told the market is oversupplied?

• Allocative

• Incentive

• Signalling

• Rationing

Which type of goods are both non-excludable and non-rivalrous?

• Private goods

• Club goods

• Public goods

• Common-pool resources

What role do prices play when there is a shortage in the market?

• Allocative

• Incentive

• Signalling

• Rationing

Which of the following is a rivalrous and non-excludable good?

• Club goods

• Public goods

• Common-pool resources

• Private goods

Which of the following is an example of a rivalrous and excludable good?

• Cars

• Lighthouses

• Home internet connection

• National defence

In negative consumption externalities, how does demand compare to equilibrium?

• Too many units are being sold

• Too few units are being sold

• Demand is at equilibrium

• Demand is irrelevant

What is the solution to overproduction in the context of externalities?

• Tax

• Subsidy

• Increase production

• Decrease production