Chapter 1 and 2
What is Economics?
A. The study of where people live
B. The study of how people use their scarce resources to satisfy their unlimited wants
C. needs and wants of a consumer
D. Spending and saving money
B. The study of how people use their scarce resources to satisfy their unlimited wants
What word best fits this definition: All those who live under one roof
A. A firm
B. Utility
C. Household
D. Apartment
C. Household
True or False: Supply indicates how much of a good producers are willing to or able to offer for sale per period at each price
A. True
B. False
A. True
What is a monopoly?
A. A board game
B. The sole supplier of a product with no close substitutes
C. A market structure with many sellers
D. None of the above
B. The sole supplier of a product with no close substitutes
An increase in the economy's average price level. Which does this statement represent?
A. Inflation
B. Deflation
A. Inflation
What is a sunk cost?
A. All of your choices when making a decision
B. A cost you have already paid and cannot recover
C. Something that is not physical which requires scarce resources to produce and satisfy human wants
B. A cost you have already paid and cannot recover
Which tools does monetary policy use?
A. Buying and selling securities
B. Lending money to banks
C. Paying interest on bank reserves
D. All of the above
D. All of the above
What do ALL producers use?
A. Tools
B. Fixed cost
C. Budgets
D. Fixed and variable costs
D. Fixed and variable costs
True or False: A cartel is a group of firms that agree to act as a single monopolist to increase the market price and maximize the group's profits.
A. True
B. False
A. True
Part of the business cycle; got laid off or fired. What type of unemployment is represented?
A. Frictional
B. Seasonal
C. Structural
D. Cyclical
D. Cyclical
How many economic systems are there?
A. 10
B. 3
C. 4
D. 8
C. 4
Businesses that are considered monoolies except for?
A. Eversource
B. Google
C. Halos
D. Amazon
C. Halos
What is the profit equation?
A. ?=mx+b
B. ?=total rev. - total cost
C. ?=C+I+G+(X-M)
D. =LxWxH
B. Profit=total rev. - total cost
A farmer buys a new tractor, what component of GDP is affected?
A. Consumption
B. Government
C. Investment
D. Net exports
C. Investment
What happens to the value of the peso if the price of imported vegetables from Mexico decreases?
A. The peso appreciates
B. The peso depreciates
A. The peso appreciates
Which word best fits the following definition: The ability to make something using fewer resources than other producers require; make more, use less?
A. Law of comparative advantage
B. Efficiency
C. Law of absolute advantage
C. Law of absolute advantage
True or False: More buyers=less demand and less buyers=more demand
A. True
B. False
B. False
Who determines a price ceiling?
A. a business
B. The consumer
C. A corporation
D. The government
What type of GDP is the most accurate method of measuring?
A. Nominal GDP
B. Consumer GDP
C. Government GDP
D. Real GDP
D. Real GDP
A worker is between jobs and is looking for a new one.What type of unemployment is represented?
A. Frictional
B. Seasonal
C. Structural
D. Cyclical
A. Frictional
____shoes the possible combinations of two types of goods that can be produced when available resources are employed efficiently.
A. A supply graph
B. A demand graph
C. Price ceiling/price floor graph
D. Production possibilities frontier
D. Production possibilities frontier
Which of the following correctly describes the Law of demand? Choose all that apply
A. When the price goes up…the quantity demanded stays the same
B. When the price goes up…the quantity demanded goes down
C. When the price goes up…the quantity demanded goes up
D. When the price goes down…the quantity demanded stays the same
E. When the price goes down…the quantity demanded goes down
F. When the price goes down…the quantity demanded goes up
B. When the price goes up... the quantity demanded goes down
F. When the price goes down...the quantity demanded goes up
What is the elasticity of supply?
A. A price ratio
B. Changes in consumer trends
C. Measures of changes to the quantity supplied after a price shift
D. The supply difference before and after a sale
C. Measure of changes to the quantity supplied after a price shift
True or False: An American buying clothes produced in Vietnam is counted in the US GDP
A. True
B. False
B. False
What is an embargo?
A. an allowance of trade or other commercial activity with a particular country
B. A ban on trade or other commercial activity with a particular country
B. A ban on trade or other commercial activity with a particular country