Macroeconomics Principles and Policy 11th Edition by William J. Baumol – Test Bank

Macroeconomics Principles and Policy 11th Edition by William J. Baumol – Test Bank

Chapter 4 TF—Supply and Demand: An Initial Look

TRUE/FALSE

  1. Scarcity and choice are the basic problems of economics; the supply and demand mechanism is the basic investigative tool of economics.

ANS: T PTS: 1 DIF: Easy NAT: Analytic

LOC:Supply and demand:The Invisible Hand

  2. Governments of market-oriented economies never tamper with the price mechanism.

ANS: F PTS: 1 DIF: Easy NAT: Analytic

LOC: The role of government:The Invisible Hand

  3. George Washington’s troops at Valley Forge were almost destroyed by price controls.

ANS: T PTS: 1 DIF: Easy NAT: Analytic

LOC:ElasticityTOP: The Invisible Hand

  4. Very few societies have used price controls.

ANS: F PTS: 1 DIF: Easy NAT: Analytic

LOC: Supply and demand: The Invisible Hand

  5. The laws of supply and demand did not apply to Asian currencies.

ANS: F PTS: 1 DIF: Moderate NAT: Analytic

LOC:Monetary and fiscal policyTOP:The Invisible Hand

  6. “Demand” is a series of quantities demanded, one for each person in the market.

ANS: F PTS: 1 DIF: Easy NAT: Analytic

LOC: Supply and demand TOP: Demand and Quantity Demanded

  7. A demand schedule shows the time over which different quantities will be demanded.

ANS: F PTS: 1 DIF: Easy NAT: Analytic

LOC: Supply and demand TOP: Demand and Quantity Demanded

  8. A demand schedule relates prices of a particular good to quantities demanded.

ANS: T PTS: 1 DIF: Easy NAT: Analytic

LOC: Supply and demand TOP: Demand and Quantity Demanded

  9. A demand schedule’s position is determined partly by the supply of a good.

ANS: F PTS: 1 DIF: Moderate NAT: Analytic

LOC: Supply and demand TOP: Demand and Quantity Demanded