Economics
The fundamental focus of economics is the
scarcity of resources and the largely unlimited wants of people
"Opportunity cost" refers to
the next-best alternative to an individual decision
The demand curve for a normal good will shift to the right when
income increases
Consumers can protect themselves from unexpected future expenses by
buying insurance
What does the term "bull market" refer to in the context of the stock market?
A market experiencing rising prices and investor optimism
What is a circular flow model?
The circular flow model demonstrates how money moves through society. Money flows from producers to workers as wages and flows back to producers as payment for products.
The opportunity cost of purchasing a $20,000 car is
) the other $20,000 worth of products the consumer could have bought instead
The quantity demanded of a normal good varies
inversely with the price of the good
Insurance that covers the expenses caused when the policyholder injures another person or another person's property is known as
liability insurance
What is the role of a stockbroker in the stock market?
Buying and selling stocks on behalf of clients
Which of the following is an example of a consumer?
A student buying a textbook
If there is a conflict that results in a trade-off between two economic ends, which of the following economic principles is invoked?
Every choice has an opportunity cost
Base your answers to questions 11 and 12 on The following chart shows part of the supply and demand schedules for Firm X’s most expensive automobile, the X-Racer.
Quantity Demanded Price Quantity Supplied
10 50k 130
15 45k 90
20 40k 55
25 35k 25
30 30k 8
An economist notes that there is a surplus of 75 X-Racers in this market. Which of the following best explains this occurrence?
The price of X-Racers is $45,000.
Consumers purchase insurance in order to
decrease their level of risk
How is the price of a stock primarily determined in the stock market?
By supply and demand dynamics
What is the primary role of producers in the economy?
To create goods and services for consumers
Base your answer to the following question on the following table. The numbers represent the number of each good that one worker can produce in one day in the respective countries
Country Paper Guns
US 10 20
Japan 20 5
The opportunity cost of producing one gun in Japan is
4 units of paper in Japan
Base your answers to questions 11 and 12 on The following chart shows part of the supply and demand schedules for Firm X’s most expensive automobile, the X-Racer.
Quantity Demanded Price Quantity Supplied
10 50k 130
15 45k 90
20 40k 55
25 35k 25
30 30k 8
If the government installed a price floor of $40,000 on this market for X-Racers, which of the following would most likely occur?
Excess supply would create a surplus of 35 X-Racers
Variable expenses are household payments that
change each budget cycle
What indicator is used to measure the amount of trades of a stock?
Volume
Which of the following accurately describes the relationship between tradeoffs and decision-making?
Tradeoffs involve making choices and accepting the costs or sacrifices involved.
How does the concept of opportunity cost help individuals make decisions
By considering the benefits of all available options
If the equilibrium price for sugar is $0.11 per pound, and the government sets a minimum price of $0.22 per pound on the sugar market, then
there will be a surplus of sugar and increased demand for sugar substitutes
Financial obligations that must be met regularly are known as
fixed expenses
True of false: Investors can make risk free investments by carefully analyzing a stock chart and its indicators.
False- there is always a risk of loss