Question

Answer True or False for all questions:

1. Advertising has no effect on the demand schedule for a good.

2. Economic efficiency and income equality are often conflicting goals in an economy.

3. If the budget deficit was eliminated, the federal government would have more money than it could spend.

4. Governments can eliminate market surpluses through the imposition of price floors.

5. The concept of opportunity cost only applies to societies that operate in a market-based economy.

6. Optimal decisions are made based upon the concept of opportunity cost.

Answer 1

Advertising has no effect on the demand schedule for a good

(1) False

Economic efficiency and income equality are often conflicting goals in an economy

(2) True

If the budget deficit was eliminated, the federal government would have more money than it could spend

(3) False

Government can eliminate market surpluses through imposition of price floor

(4) True

The concept of opportunity cost only applies to societies that operate in market based economy

(5) False

Optimal decision are made upon the concept of opportunity cost

(6) True