1. Positive statements:

a.Can be verified by empirical data.

b.Are optimistic.

c.Are based on people's beliefs and value systems and cannot be verified by facts.

d.Are opinions.

2. Normative statements:

a.Are always true.

b.Refer only to numbers.

c.Can be verified by empirical data.

d.Are based on people's beliefs and value systems and cannot be verified by facts.

3. A product is defined as:

a.Only services offered for sale.

b.Tangible items only.

c.Any item offered for sale.

d.Something a manufacturer creates.

4. What is meant by the term change in the quantity demanded?

a.The change in the quantity which results from a price change and implies a shift in the demand curve.

b.The change in the quantity which results from a change in any factor other than the price and implies a shift in the demand curve.

c.The change in the quantity which results from a change in any factor other than the price and implies a movement along the demand curve.

d.The change in the quantity which results from a price change and implies a movement along the demand curve.

Clear my choice

5. What are the two basic markets shown by the simple circular flow model?

a.Product and factor.

b.Competitive and monopolistic.

c.Capital goods and consumer goods.

d.Private and public goods.

e.Household and business.

6. What is the factor market?

a.The market for consumer goods and services.

b.The market for investment goods and exports.

c.The market for investment goods.

d.The market for factor services.