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Macro-economics Test Prep 1 Flashcards | StudBud
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Macro-economics Test Prep 1
Macro-economics Test Prep 1
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Macro-economics Test Prep 1: Quick test on basic microeconomic concepts
Flashcards
72 cards
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Practice quiz
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Questions
72
Answers
1
Define ceteris paribus
Keeping everything the same
Changing everything
Its a science thing
No idea
2
What is opportunity cost?
None of the above
How much you loss from shopping American
The highest valued alternative that must given up to engage in an activity
Everything you must give up total for engaging in an activity
3
A group of buyers and sellers of a particular good or service
Market
Resource
Scarcity
Demand
4
Economics is the
study of how microphones work
study of how people use money, goods, and services
study of echolocation
study of the natural landmarks
5
Societies can have everything they want.
False
True
6
If the U.S. government begins to tax a good, what happens to supply?
No way to tell
Supply will decrease (shift left)
Supply will increase (shift right)
Supply will stay the same
7
A person who purchases goods and services from other people is called a
cashier
servant
banker
buyer
8
The price for blueberries decreases. What does this mean for the demand of raspberries if they are substitutes?
People will buy both at an increased rate
The demand will increase (shift right)
There will be no change
The demand will decrease (shift left)
9
What are some assumptions of the Production Possibilities Frontier?
Fixed resources
All of the above
Technology unchanged
Fully employed resources
10
What can cause a shift in the Demand Curve?
Expected change in future price, income and availability
Prices of related goods/tastes and preferences
All of the above
Population (No. of buyers) and demographics
11
When the price of a product increases, the quantity supplied will increase
Law of Supply
Law of Demand
Market Structure
Command Economy
12
If the price of a good changes while everything else remains the same...
Supply of a good has stayed the same
Supply of a good has changed
Quantity demanded of a good has changed
Quantity demanded of a good has stayed the same
13
What is normative economics?
None of the above
Good and bad, equal balance
It describes the way this world is. Might be right or wrong
What ought to be, seeks to prescribe the way the world SHOULD BE
14
What is an entrepreneur?
Someone who operates/starts a business
Someone who buys businesses
Someone who sells businesses
A person who operates a boat
15
A positive shift in Demand or Supply will always shift
Down
Up
Left
Right
16
Define specialization
Charging the most for your service or product
Charging the least for your service or product
The process of concentrating on and becoming expert in a particular skill
Being the worst at something
17
What is the income effect?
The satisfaction received from each additional unit falls
None of the above
Increase in the price of a good will increase the demand for its substitute
As price of a good goes down the money you have gains purchasing power
18
What does
scarcity
mean?
To be scared of something
An item is easy to find or get
An item is difficult to find or get
To give an item in return for something else
19
People don't respond to economic incentive.
True
False
20
Demand is
another name for a service
a name of a coin used in the Caribbean
the amount of something that is available
the number of people who want or need something
21
Erin gave Taylor her bag of Skittles. Taylor gave Erin his bag of M&M's. This is a(n)
service
exchange
order
arrangement
22
The price of cookies decreases. What does this mean for the demand for milk if they are compliments?
It will decrease (shift left)
It will increase (shift right)
There will be no change
There is no way to tell
23
What is marginal cost (MC)?
Is the additional cost associated with one more unit of an activity
MB = MC
The optimal level of an activity
Is the additional benefit associated with one more unit of an activity
24
Define mixed economy
Market works but govt plays significant roles
Household and firms interact in the market and allocate economic resources
Govt. decides how economic resources will be allocated
None of the above
25
Effect of economic growth
Many previously unattainable combinations are now attainable
Many previously attainable combinations are now unattainable
Better stock market
Worse stock market
26
Circular Flow Diagram-What is a household?
Buy factors of production from factor markets
Supply goods and services to product markets
A family
Consists of all the individuals in a home
27
Circular Flow Diagram-A household...
None of the above
Buy factors of production from factor markets
Supply goods and services to product markets
Buy products from the firms
28
Sam went to the barber shop to get his hair cut by Dennis. Who is the seller?
Sam
Neither
Both
Dennis
29
What is a complementary good
None of the above
Goods and services that can be used for the same purpose
Goods and services that are used together
Big Mac and Whopper, Jeans and Khakis
30
If a company is expected to raise the price of products next month, the current demand will...
decrease (shift left)
no way to tell
increase (shift right)
stay the same (no shift)
31
Goods typically used with each other
Substitute Goods
Complementary Goods
Law of Supply
Law of Demand
32
If you go to the bookstore and buy a book, that book is a
trade
good
buyer
service
33
The Scholastic Book Fair brought over 600 books to our school. They have a large ____ of books.
demand
scarcity
exchange
supply
34
What are substitute goods?
Hot dogs and hot dog buns, Cars and Petrol, Toothpaste and toothbrush
None of the above
Goods and services that are used together
Goods and services that can be used for the same purpose
35
Who sets prices?
Businesses
Seller
Buyer
The market
36
Circular Flow Diagram-Firms...
Provides the factors of production
Buy products from the firms
Receive payment for these factors by selling them to firm in factor markets
Buy factors of production from factor markets
37
Define market economy
Govt. decides how economic resources will be allocated
Market works but govt plays significant roles
Household and firms interact in the market and allocate economic resources
None of the above
38
Circular Flow Diagram-What is the factor market?
None are correct
Both are correct
Trade factor of production
Buy and sell final product
39
Who makes up a society?
Robots
Individual, business, government etc
Aliens
Pets
40
What is a normal good?
None of the above
Mac & cheese, ramen noodles
A good for which the demand increases as income falls and vice versa
A good for which the demand increases as income rises and vice versa
41
What is the diminishing marginal utility?
The satisfaction received from each additional unit falls
As price of a good goes down the money you have gains purchasing power
Increase in the price of a good will increase the demand for its substitute
You can buy more stuff with the same amount of money
42
If an item is in high ______, the item may be sold out.
exchange
effect
demand
supply
43
A negative shift in Supply or Demand will always shift
Down
Up
Left
Right
44
What is marginal benefit (MB)?
Is the additional benefit associated with one more unit of an activity
MB = MC
The optimal level of an activity
Is the additional cost associated with one more unit of an activity
45
Which of the following is NOT a shifter of supply?
Government intervention (taxes or subsidies)
The number of sellers in a market
The price of the resources used to make a product
The price of the product produced
46
What is an inferior good?
A good for which the demand increases as income falls and vice versa
None of the above
A good for which the demand increases as income rises and vice versa
Steaks, cars, housing, jewelry
47
Which of the following is NOT a change in Demand shifter?
Price of the Product
Income of Consumers
Tastes and Preferences of Consumers
Size of the Population/Market
48
What is this question asking "_______ goods and service will be produced?"
How
Where
What
Who
49
The quantity demanded of a good falls when the price of the good rises.
Law of Demand
Market Equilibrium
Law of Supply
Market Structure
50
What is the substitution effect?
As price of a good goes down the money you have gains purchasing power
The satisfaction received from each additional unit falls
Increase in the price of a good will increase the demand for its substitute
You can buy more stuff with the same amount of money
51
Circular Flow Diagram-What is the product market?
None are correct
Both are correct
Trade factor of production
Buy and sell final product
52
What is MB = MC?
Is the additional benefit associated with one more unit of an activity
The optimal level of an activity
Is the additional cost associated with one more unit of an activity
None of the above
53
Define centrally planned
Govt. decides how economic resources will be allocated
Household and firms interact in the market and allocate economic resources
None of the above
Market works but govt plays significant roles
54
Goods that can be easily used in place of another
Complementary Goods
Law of Supply
Substitute Goods
Law of Demand
55
Circular Flow Diagram-Firms are
Consists of all the individuals in a home
Buy products from the firms
Suppliers of goods and services
Provides the factors of production
56
When a product is scarce, the sellers may
charge a low price for it
charge a high price for it
give it away for free
give people a discount
57
Buyers determine __________, and sellers determine _________.
Demand, Supply
Resources, Market
Market, Resources
Supply, Demand
58
What is an economic good?
An item that is useful to people but scarce in relation to its demand
A good for which the demand increases as income rises and vice versa
Goods and services that are used together
A good for which the demand increases as income falls and vice versa
59
Circular Flow Diagram-A household...
Supply goods and services to product markets
Provides the factors of production
Buy factors of production from factor markets
None of the above
60
Economics is generally concerned with positive economics
True
False
61
A person who sells goods and services from other people is called a
Observer
Servant
Seller
Buyer
62
What happens to the demand for bottled water on a really hot day at the beach?
Demand will shift up along the graph
Demand will shift right
Demand will shift down along the graph
Demand will shift left
63
If more baseball players move to Central, what can we expect for the supply of bats here?
Supply will decrease (shift left)
No way to tell
Supply will increase (shift right)
Supply will stay the same
64
Circular Flow Diagram-Firms...
Receive payment for these factors by selling them to firm in factor markets
Provides the factors of production
Supply goods and services to product markets
Buy products from the firms
65
Katie went to the doctor for a check-up. The doctor provided a _____.
good
product
supply
service
66
Why are demand curves are downward sloping?
All of the above
The income effect
Diminishing marginal utility
The substitution effect
67
What is this question asking "_______ will receive the goods and services produced?"
What
Who
How
Where
68
What is this question asking "_______ will the goods and service will be produced?"
Who
How
Where
What
69
The point where the quantity supplied is equal to the quantity demanded
Market Equilibrium
Inelastic Demand
Market Structure
Law of Supply
70
If the price of a good remains constant, nonprice determinants influence the demand...
No change in demand for the good
Shift in the supple for the good
No change in supply for the good
Shift in demand for the good
71
If the government provides a subsidy to a company, what will happen to supply?
It will increase (Shift Right)
There is no way to tell
It will stay the same
It will decrease (Shift Left)
72
What is economic growth?
How well a company is doing economically
The ups and downs of the stock market
The ability of the economy to increase the production of goods and services
Moving up in wealth
