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Econ Test 2 Flashcards | StudBud
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Econ Test 2
Econ Test 2
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Answers
1
The value of a country's currency is determined by changes in supply and demand, this is which type of exchange rate
Fixed
floating
2
Gas prices rise in the short term?
inelastic
elastic
3
What would happen if the price ceiling were placed above the equilibrium point on the graph?
No change
Demand curve would shift
Supply curve would shift
It would be ineffective
4
Why is the demand curve downward sloping?
Prices go up = quantitity demand goes down
Prices go down = quantity demand goes down
5
What are some ways to allocate resources?
first come, first serve
all of the above
achievement-based
need-based
6
Price elasticity of demand formula =
% change in q / % change in time
% change in q / % change in p
% change in time / % change in p
% change in p / %change in q
7
Price floors help ________
producers
consumers
8
If a natural unfavorable event such as a drought occurs, the supply curve for apple will shift to the
left
right
9
What happens to the supply curve for butter, if the price of butter rises
shifts to the right
moves along the curve
shifts to the left
10
What are some factors that shift demand?
more consumers enter market
more producers enter market
Price increase for your good
substitutes' price rise
11
What mathematical equation do economists use to determine how much of a shortage is there?
P1-P2
QS-QD
P2-P1
QD-QS
12
Which of these are factors that can change exchange rates?
changes in preferences for foreign goods
all of the above
changes in prices in different countries
changes in incomes in different countries
13
What is considered elastic
=1
>1
<1
14
Price floors create _______
Surpluses
Shortages
15
What would be considered inelastic?
many substitutes
high portion of a person's income
luxury goods
necessities
16
A ___________ is a specific type of trade barrier that completely bans trade with a foreign country
tariff
embargo
quota
17
Price ceilings create
Surpluses
Shortages
18
What would medicine be considered as?
elastic
inelastic
19
Price ceilings are made to help
Producers
Consumers
20
What are some ways to allocate goods?
Brute Force
All of the above
Lottery
Appearance
21
Why would it benefit country A to trade with Country B when Country B has lower/inferior capabilities?
Country A would not benefit
Country B has an absolute advantage
Country A is lazy
Country B has a comparative advantage
22
What would a vacation be considered as?
inelastic
elastic
23
What would sprite be considered as?
inelastic
elastic
24
The ________________ states that as prices go up, the quantity supplied goes up.
Law of the Land
Law of Supply
Law of Demand
Law of Increasing Opportunity Costs
25
a _________ has occurred directly below equilibrium as a result of the implementation of a price ceiling
shortage
nothing
surplus
price floor
26
What would be considered elastic?
luxury items
necessities
few substitutes
low portion of someones income
27
are safety, environmental, health, or other technical, requirements set by a government.
subsidies
embargos
tariffs
standards
