Which is not a Key Economic Question?

Where is it going to be produced?

The Law of Supply says...

when price goes up, more is produced

Which of the following are ways the government controls markets?

price ceilings and price floors

What was Adam Smith's opinion about the profit incentive?

People should profit from their hard work

Why does a government place price ceilings, such as rent control, on some “essential” goods?

to keep the goods from becoming too expensive

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Economics Ch 6 Review

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Questions 36

Answers

1
A bakery has a surplus at the end of each day. What should the owner do?
stop selling bread
sell only bread
lower the price of the bread
raise the price of the bread
2
a government grant the guarantees a certain price
opportunity cost
subsidy
minimum wage
tax
3
when quantity and demand are unequal
equalibrium
disequalibrium
price floor
price ceiling
4
Producing only what you are good at is called...
Diversification
Specialization
Market factor
Cost/Benefit Analysis
5
How does rationing encourage black markets?
it causes criminal behavior
it creates high supply
it wrecks the market
it creates high demand
6
when too few companies make a product
black market
imperfect competition
grey market
perfect competition
7
What was the purpose of rationing in the U.S. during WWII?
to limit production
to stop the black market
to give away goods
to deal with shortages
8
a sudden shortage of a good
price shock
electric shock
supply shock
demand shock
9
What happens after the demand for a very popular product drops?
the price goes down
the price goes up, and then goes down
the price stays the same
the price goes up
10
Which is not a Key Economic Question?
What is going to be produced?
Who is it going to be produced for?
How is it going to be produced?
Where is it going to be produced?
11
a product that is popular for a short time
cool
fad
special
inventory
12
What happened when the supply of digital cameras increased?
The demand curve moved right.
The supply curve moved right.
The supply curve moved left.
The demand curve moved left.
13
The Law of Supply says...
when price goes up, more is produced
when price goes down, more is produced
when price goes up, demand goes down
when price goes up, demand goes up
14
the way buyers and sellers communicate
rationing
demand
supply
price system
15
A graph that shows different ways an economies resources can be used
production possibilities chart
Production possibilities frontier
production possibilities schedule
production possibilities curve
16
when the demand for a product or service is equal to the supply
subsidy
disequilibrium
surplus
equilibrium
17
Which of the following are ways the government controls markets?
subsidies and excess demand
equilibrium and disequilibrium
price ceilings and price floors
shortages and surpluses
18
The extra income from selling one more unit...
total revenue
marginal revenue
total cost
marginal cost
19
a reason to raise prices
lower input costs
increased supply
decreased demand
increased demand
20
the lowest price a worker can be paid
max wage
standard wage
minimum wage
surplus wage
21
dividing up a fixed amount of goods and services to each person
price system
supply shocking
competing
rationing
22
What was Adam Smith's opinion about the profit incentive?
People should profit from their hard work
People don't always get what they need
Profit incentive makes goods too expensive
Profits are needs, not wants
23
an illegal market with high prices
purple market
grey market
black market
red market
24
when the amount supplied is more than the amount demanded
shortage
subsidy
fad
surplus
25
What happens after the demand for a very popular product drops?
The price goes up
there is a surplus
there is a shortage
suppy and price goes up
26
What did suppliers do when the supply of digital cameras increased?
Suppliers did not meet demand.
Suppliers decreased inventory
Suppliers raised prices.
Suppliers lowered prices.
27
Why does a government place price ceilings, such as rent control, on some “essential” goods?
to keep demand for these goods lower than themarket would
to keep people from starting new businesses
to keep existing businesses from making largeprofits
to keep the goods from becoming too expensive
28
All natural resources used to produce goods or services
land
physical capital
labor
human capital
29
the costs consumers pay to look for a good
search and destroy
search costs
search demand
search price
30
the goods a company has on hand
quantity supplied
supply
fad
inventory
31
using assets to make money
invest
total revenue
supply shock
cash purchase
32
by law, the most that can be charged for a good or service
price ceiling
price floor
surplus
subsidy
33
when the supply curve shifts left
decreased supply
increased demand
increased supply
decreased demand
34
What does low price for a product tell suppliers?
not enough is being produced
too much is being produced
demand will go down
demand will go up
35
when a supply curve shifts
change in demand
change in supply
change in search costs
change in opportunity costs
36
What happens to the price of a good when there is excess demand?
government sets the price
price goes down
price stays the same
price goes up

Economics Ch 6 Review Flashcards | StudBud