A shortage occurs when...

The item is priced below equilibrium

Which of the following would cause a shift in demand?

An advertising campaign by a producer

Which of the following would most likely cause the price of used cars increase?

A news story points out the economic advantages of used cars

What are the four factors of production?

Land, Labor, Capital and Entrepreneurship

Which of these would likely decrease the price of a good or service?

A decrease in the price of a substitute good

Goods and services are produced in a market economy because...

People want to make a profit for themselves

An economic idea stating the more of something a person consumes the less satisfaction they get

Law of diminishing marginal utility

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Microeconomics Review

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Questions 22

Answers

1
A shortage occurs when...
The item is priced below equilibrium
The supply curve shifts right
The supply curve shifts left
The item is priced above equilibrium
2
In which economic system does a central authority decide what/when/how to produce?
Traditional
Agrarian
Command
Market
3
In a market economy, a winter coat would be sold in the...
Product Market
Mall
Firm
Factor Market
4
What is likely to happen if there is a surplus of goods or services in the market?
Supply curve will shift left
Price will decrease
Price will increase
Supply curve will shift right
5
Unlimited wants and needs in a world of limited resources is called...
Opportunity Cost
Economics
Trade off
Scarcity
6
Which of the following would cause a shift in demand?
A natural disaster increases input costs
An advertising campaign by a producer
A new producer enters the market
New technological development
7
What happens to the demand curve when you raise the price of the good or service?
We cannot tell
The demand curve shifts left
Nothing
The demand curve shifts right
8
Which of the following would most likely cause the price of used cars increase?
A news story points out the economic advantages of used cars
A new car dealership has an "end of year clearance"
A brand new used-car dealership opens in Grayslake
A news report points out the dangers of buying used cars
9
What are the four factors of production?
Needs, Wants, Goods and Services
Land, Labor, Capital and Entrepreneurship
Supply, Demand, Equilibrium, Price
Land, People, Products, Demand
10
What is an example of something that would be sold in a factor market?
Automobiles
Sneakers
Lumber
Cell Phones
11
How do you determine company PROFITS?
Demand * Price
Demand / Price
Costs - Revenue
Revenue - Costs
12
Movement along the supply curve in a supply and demand graph occurs when...
Supply shifts right
Supply shifts left
We cannot know
There is a change in price
13
Which of these would likely decrease the price of a good or service?
A decrease in the price of a substitute good
An increase in the number of consumers
A shortage of available goods or services
An increase in the price of a substitute good
14
This image is an example of the
Circular Flow Chart
Law of Demand
Law of Supply
Wants and Needs Chart
15
What drives production decisions in a market economy?
Consumer demand
Price of labor
Price of the factors of production
Firm production capabilities
16
Goods and services are produced in a market economy because...
Cultural traditions drive production decisions
People have unlimited wants and needs
People need goods and services
People want to make a profit for themselves
17
An economic idea stating the more of something a person consumes the less satisfaction they get
Law of shifting demand
Law of diminishing marginal utility
Law of substitution effect
Law of increasing marginal utility
18
When supply = demand, it is called...
Surplus
Shortage
Profit
Equilibrium
19
Quantity supplied increases as price increases is the...
Law of Supply
Law of Demand
Equilibrium
Not a real thing
20
The "ceteris parabus" principal means
All other things equal
All other things not the same
All variables considered
All possibilities are equal
21
Which of the following is likely to cause the situation in the graph to occur?
An increase in the number of businesses in the market
A decrease in consumer income
A decrease in the number of businesses in the market
An increase in consumer in come
22
Which of the following would increase the price of a product?
Supply and demand curves shift left
Supply Curve Shifts Right
Demand curve shifts left
Supply curve shifts left

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