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Microeconomics Review
Microeconomics Review
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Microeconomics review #microeconomics
Flashcards
25 cards
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Practice quiz
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Questions
25
Answers
1
Where do individuals spend the money they earn?
Super Market
Product Market
Factor Market
Households
2
What is the basic unit of study in microeconomics? (hint: think circular flow)
individual businesses and households
government taxes and spending
total consumer spending and saving
employment and unemployment figures
3
Buyers help determine price in a market economy by
How they are taxed
How much they demand a product and are willing to spend
How much they produce as households
How much they value the dollar over other currencies
4
Interdependence and price wars between a few firms are characteristics of which market structure?
Perfect Competition
Monopoly
Oligopoly
Monopolistic Competition
5
Which sentence describes market conditions at equilibrium/market clearing price?
Demand is greater than supply
Supply and demand are equal
Supply is greater than demand
There is no supply or demand
6
In the circular flow model, what do individuals SELL to businesses
Resources
Goods and Services
Products
Revenue
7
With demand staying the same, if the supply of hot dogs reduced, what will happen to the price?
It will decrease
It will increase
One can not tell from the information provided
It will remain the same
8
What is shown in the graph below?
A decrease in supply
An increase in quantity supplied
A decrease in demand
An increase in supply
9
The flow of goods and services from business to households primarily takes place in the???
product market
factor market
financial market
intermediary good market
10
One advantage of operating as a partnership would include???
Greater power than a sole trader for decision making
Specialization of the partners in needed areas
Being able to raise capital through shares of stock
Limited liability for all partners
11
Which of the following is considered a negative side effect of the minimum wage?
Failure to meet production
full employment
increased interest rate
Increased unemployment
12
If the price of cameras goes down, what will happen to the demand for camera lenses?
It will not be affected
It will increase
It will decline
The information can not be known from the available info
13
Amy opened a new business. She has unlimited liability but can make all the decisions. This is a
franchise
corporation
sole proprietorship
partnership
14
If Ed bought $800 in Verizon stock and then it went bankrupt, how much would he be liable for?
Partial liability, he will use savings to pay company debt
Limited liability, he will only lose the $800 he invested
Limited liability, he will be reimbursed the $800
Unlimited liability, having to sell stuff to pay the debt
15
Which is NOT required for a product to be in demand?
desire
ability
willingness
scarcity
16
What problem does a price ceiling below equilibrium create?
Minimum Wage
Surplus
Shortage
Profits
17
Moving from 6 dollars to 9 dollars would lead to a
Decrease in quantity demanded
Increase in quantity demanded
Increase in demand
Decrease in demand
18
Unlike perfect competition, monopolistic competition features ______.
Independent buyers and sellers
Freedom for buyers and sellers
Well informed buyers and sellers
product differentiation
19
A market structure that features a unique product and total price control by the firm is a ???
Monopolistic Competition
Monopoly
Sole Proprietorship
Corporation
20
What is the economic term that describes the situation where there is more demand than supply?
Excess
Shortage
Surplus
Equilibrium
21
The law of supply states that
the lower the price the more producers will supply
the higher the price the more consumers will buy
the higher the price the more producers will supply
the lower the price the more consumers will buy
22
A large number of independent buyers and sellers who exchange IDENTICAL products is known as
Oligopoly
Monopoly
Monopolistic Competition
Perfect Competition
23
What is the economic term that describes the situation where there is more supply than demand?
Bonus
Surplus
Shortage
Scarcity
24
A good that is used in place of another good is?
Substitute good
Complementary good
Capital good
Consumer good
25
What would cause the following shift ( from D2 to D1) shown in the graph?
Yogurt prices fall to milk surplus
A new health report says yogurt makes you sick
Yogurt prices rise due to milk shortage
A new report says that yogurt keeps you healthly
