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Lesson 2.02.5 Study Review Flashcards | StudBud
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Lesson 2.02.5 Study Review
Lesson 2.02.5 Study Review
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Answers
1
Excess demand ends when the selling price reaches the point at which consumers are will buy _______ producers then sell
more expensive goods than
fewer products than
the same quantities that
a larger amount than
2
How do producers answer the economic question of
what
to produce in a market economy?
They produce products that cost them the most to produce.
They produce products that provide the least incentives.
They produce products for which they have the most information.
They produce products that are the most profitable.
3
What exists when producers produce more than buyers are willing and able to buy?
Equilibrium price
Excess Demand
Normal price
Excess supply
4
Some energy companies offer free electricity at night and on weekends because during those times
supply is greater than demand.
Supply and demand are equal
the substitution effect occurs
demand is greater than supply.
5
What do producers often do when supply is greater than demand?
Lower quality
Increases Quality
Lower Prices
Increases Prices
6
How are prices used in our economy?
To provide equilibrium in the market
To encourage excess supply
To ration limited resources
To encourage excess demand
7
What is the amount of money for which an item sells in the competitive marketplace?
Value
Market
Price
Utility
8
After a mild, dry winter, the supply of sleds should be ________than demanded. Therefore, the price would be __________.
less; increased
greater; decreased
less; decreased
greater; increased
9
When supply is greater than demand, a __________ often develops.
Shortage
Price Cieling
Seller's Market
Buyer's Market
10
If store sells shirts at $10 what would likely occur if all factors remain the same and their is demand at this price.
If the price is raised, business profits will go up.
If the price is lowered, business profits will go down.
If the price is raised, the volume of sales will go up.
If the price is lowered, the volume of sales will go up.
11
To be able to charge competitive prices in our economy, producers must combine resources and technologies to produce
items to sell at relative prices.
items at the lowest cost possible
more than consumers will buy
limited quantities of goods.
12
Which is a business comparing when it analyzes the cost of buying wood desks versus the cost of buying metal desks:
Incentives
Relative price
Excess demand
Inflated price
13
Who gets the goods and services produced in our economy?
Whoever has the least costs
Whoever is willing and able to pay the prices
Whoever is most efficient
Whoever obtains the most information and incentives
14
Which would be an example of a change in Relative price Ratio if red apples where 60 cents and Green apples 80 cents?
Red apples @ 90¢ per pound; green apples @ 80¢ per pound
Red Red apples @ $1.20 per pound; green apples @ $1.60 per pound
Red apples @ 30¢ per pound; green apples @ 40¢ per pound
Red apples @ 45¢ per pound; green apples @ 60¢ per pound
15
Determine a product’s equilibrium price by examining the following table:
$12.00
$11.50
$12.50
$11.00
16
How much a consumer is willing to pay for a product depends partly on the consumer’s opinion of the product’s
Value
Production Cost
efficiency
Target Market
17
Which of the following is an example of the substitution effect:
The demand price of a ticket is exactly equal to its supply price.
The mayor recently instituted a price ceiling on the monthly rent
The price of laptops went up recently, she decided to buy a tablet instead.
candy bar costs $.50, and gum is a $1. The relative price ratio is 1 to 2.
18
What usually happens to the demand for a good or service when the price increases?
It Varies
It increases
It decreases
It stays the same
19
What are the incentives in our economy that encourage producers to change and reallocate their resources?
Profits
Consumers
Expansions
Stocks
20
Excess demand and excess supply cause changes in
relative price ratio
price determination
market price.
price Index
21
What do consumers, producers, and resource owners need to have to make economic decisions?
Information about prices
Limited Liability
Rationing Skills
Economic Incentives
22
Prices set higher than the equilibrium price will result in
excess demand.
excess supply.
decreased supply.
increased profits
23
What is one factor that will determine how much a customer is willing to pay for a good or service?
Rationing
Incentive
Buying power
Production costs
24
When demand is greater than supply, a __________ often develops.
Buyer's Market
Surplus
Price Cieling
Seller's Market
25
Any factor that causes changes in supply and demand will cause changes in
A Price
b. value. d. usefulness.
Value
Utility
