23.
On the basis of the information, it can be said that:
A.
no coincidence of wants exists between any two states.
B.
a coincidence of wants exists between Michigan and Washington.
C.
a coincidence of wants exists between Texas and Washington.
D.
a coincidence of wants exists between Michigan and Texas.
24.
On the basis of the information and assuming trade occurs between the three states, we can expect:
A.
Washington to exchange apples with Texas and receive money in return.
B.
Washington to exchange apples with Michigan and receive money in return.
C.
Texas to exchange lettuce with Michigan and receive autos in return.
D.
Texas to trade lettuce directly for Washington apples.
25.
Given the information and assuming trade occurs between the three states, we can expect:
A.
that there is no means by which Michigan can obtain lettuce while specializing in the production of autos.
B.
that money will not be needed to accomplish the desired exchanges.
C.
money to flow counterclockwise from Michigan to Texas to Washington.
D.
money to flow clockwise from Michigan to Washington to Texas.
26.
Barter:
A.
is the major means of exchange in centrally planned economies.
B.
accounts for over 30 percent of the dollar volume of all exchange in the U.S. economy.
C.
entails the exchange of goods for goods.
D.
is used to circumvent the problem of a lack of coincidence of wants among potential buyers and sellers.
27.
The “coincidence of wants” problem associated with barter refers to the fact that:
A.
for exchange to occur, each seller must have a product that some buyer wants.
B.
money must be used as a medium of exchange or trade will never occur.
C.
specialization is restricted by the size or scope of a market.
D.
buyers in resource markets and sellers in product markets can never engage in exchange.
28.
The use of money contributes to economic efficiency because:
A.
governmental direction of the production and distribution of output can be avoided by using money.
B.
roundabout production could not occur without the availability of money.
C.
it is necessary for the creation of capital goods.
D.
it promotes specialization by overcoming the problems with barter.
29.
The presence of market failures implies that:
A.
money is not an effective tool for exchange in a market system.
B.
there is an active role for government, even in a market system.
C.
individuals and firms should strive to be self-sufficient rather than specialize.
D.
command systems are superior to market systems in the allocation of resources.
30.
Which of the following characteristics is least unique to a market system?
A.
Private ownership of property resources.
B.
Competition among buyers and sellers pursuing monetary returns.
C.
The widespread use of money.
D.
Freedom of enterprise and choice.
31.
Which of the following is one of the Five Fundamental Questions?
A.
Which products will be in scarce supply and which in excess supply?
B.
Who should appoint the head of the central bank?
C.
How much should society save?
D.
What goods and services will be produced?
32.
If competitive industry Z is making substantial economic profit, output will:
A.
fall in industry Z and firms will likely leave the market.
B.
fall in all industries except industry Z.
C.
expand in industry Z as more resources will move to that industry.
D.
expand in industry Z, but no new firms will enter the market.
