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Chapter 5

Multiple Choice Quiz

Multiple Choice Quiz

Answer the questions below. When you are ready, click on "Submit for Grade" in order to see your results.

This activity contains 10 questions.

	Marginal analysis of any action is concerned with its   costs and benefits at the margin. total benefits, but not costs. total costs, but not benefits. total costs and benefits.

	A prisoner's dilemma is   a game where parties would gain by not cooperating, but self-interest causes them to cooperate. a game where parties would gain by cooperating, but self-interest causes them not to cooperate. a game where all parties cooperate. not an example of game theory.

	At a price per pen of $5, the quantity of pens demanded is 200 units and the quantity supplied is 100 units.   $5 is a disequilibrium price. $5 is a relative price. $5 could be either an equilibrium price or a disequilibrium price. $5 is an equilibrium price.

	Rent controls   result in market clearing prices. result in equilibrium prices. lead to disequilibrium prices. are prevalent in all housing markets.

	When price controls are imposed in any product market,   the market does not clear. an equilibrium price does not emerge. there are unintended consequences. there is a shortage. all of the above

	According to the principle of unintended consequences,   economic policies have unintended consequences on producers, but intended consequences on consumers. economic policies can have unintended consequences on both producers and consumers. unintended economic policies are made by the government. economic policies have unintended consequences on consumers, but intended consequences on producers.

	An equilibrium price of a good   A) is also its market clearing price. B) results in no shortage or surplus. C) always results from government intervention in markets. D) is always the same as its relative price. both A and B both B and D

	Third-party payments occur when   you purchase insurance coverage for your car in case you get into an accident with a driver who has no insurance. an organization such as the government invests your retirement funds for you. landlords make payments for apartment maintenance costs to rent-control authorities. another campus club pays for your club's next activity. your medical insurance company pays a portion of the cost of your drug prescription.

	In an effort to preserve the ozone layer, the U.S. government places heavy taxes on the damaging refrigeration compound Freon. An unintended consequence of this tax has been to   replace the use of Freon with newer, less damaging refrigeration compounds. decrease the amount of ozone-depleting refrigerants released. cause a more rapid retirement of machines that use Freon. encourage importers to bring in Freon illegally.

	If a student determines that the benefits of studying one additional hour per week are $5 and that the costs of this additional hour of study are $7, the student will likely   study the extra hour. spend even more than another hour studying. quit studying. not study the extra hour.

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