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Econ - Final Exam Review
Econ - Final Exam Review
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Ch. 1-7
Flashcards
45 cards
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Practice quiz
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Questions
45
Answers
1
The United States has a
pure free enterprise system
modified free enterprise system
command economy
traditional economy
2
At a given price, a shortage occurs when
the quantity supplied is greater than the quantity demanded
the quantity supplied is less than the quantity demanded
the quantity demanded is the same as the quantity supplied
the quantity demanded is less than the quantity supplied
3
In which economic system does the gov't own the means of production?
traditional
mixed
market
command
4
Which of the following will cause the market supply curve to shift?
a change in the number of sellers of the product
a change in the price of the product
a change in the number of consumers
a change in demand for the product
5
In the year 2000, Bill Gates was the world's richest person. This stemmed from his
concern for the natural environment
entrepreneurial skills
inherited wealth
experience in human relations
6
Which of the following is true about a shareholder in a corporation?
A shareholder may not share in the earnings of that corp
A shareholder is liable for any debts accumulated by corp
A shareholder is part owner of that business
A shareholder may not transfer his share without permission
7
In the American economy, the goal of economic equity is MOST connected with
subsidizing businesses that would otherwise fail
giving participants a fair chance to succeed
restoring laissez-faire capitalism
creating limits on corporate profits
8
Interdependence and price leadership are char. of firms in what kind of market structure?
monopolistic competition
perfect competition
monopoly
oligopoly
9
Perfect competition is characterized by
diverse products
a large number of buyers and sellers
uniformed buyers and sellers
sellers acting together to set prices
10
A market economy has an advantage over a trad'l economy in that the market economy
limits the profits of large corporations
fixes incomes of consumers
controls prices and wages
adjusts to consumer demands over time
11
The minimum wage is a type of
price ceiling
comparable worth
price floor
marginal price
12
In which market structure does a firm have greatest control over its product's price?
perfect competition
monopolistic competition
oligopoly
monopoly
13
The largest variable input is usually
price
land
labor
capital
14
Which of the following is NOT a characteristic of free enterprise capitalism?
Profit motive
Economic equity
Private property rights
Competition
15
Which of the following is an example of a microeconomic decision?
how many hours an employee should work each week
whether to increase or decrease the money supply
whether to increase or decrease taxes
how to reduce the unemployment rate
16
Who ultimately determines the products that a free enterprise economy produces?
state and local gov'ts
Congress
consumers
the President
17
What basic econ problem do both higher income nations and lower income nations have in common?
too many unskilled laborers
too much gov't
lack of capital goods
scarcity of resources
18
An economy at its production possibilities frontier is operating
with slow economic growth
at full potential
as a free enterprise economy
beyond its potential
19
What is the unit of study in microeconomics?
hiring ten employees
inflation and recession
national consumption and expenditures
individual businesses and households
20
Least numerous form of business organization in the United States
corporations
multinationals
sole proprietorships
partnerships
21
People against raising the min wage argue that when a legal min wage is est above equil. wage
the quantity of labor supplied will decrease
employers will have an incentive to use more labor
there will be an increase in unemployment
the quantity of labor demanded by firms will increase
22
Producers make goods that consumers like and are willing to pay for = principle of
command economy
traditional economy
market economy
socialism
23
Which of the following is NOT a US economic and social goal?
economic security
economic interdependence
economic efficiency
economic equity
24
If a nation encourages entrepreneurship, then which of the following is likely to occur?
very little change in overall production of goods & services
a decline in the number of new businesses started
dev. of many new products and process methods
fewer applications to the US Patent Office
25
The payments for land, labor, capital, and entrepreneurial ability respectively are
wages, rent, profit, and interest
rent, wages, interest, and profit
rent, profit, wages, and interest
profits, wages, interest, and rent
26
In the US, how are public goods paid for?
The gov't collects tax revenues from indivs. and firms
Corporations make profits from selling goods and services.
Private firms collect fees from their employees
Non-profit orgs collect charitable donations from people
27
Which of the following is an example of an investment in human capital?
A company builds a new factory
A country builds new schools
A state puts in a new highway
A person goes to college
28
In a market economy, a high price is a signal for
producers to supply less and consumers to buy more
producers to supply more and consumers to buy less
gov't to intervene to protect consumers
producers to supply less and consumers to buy less
29
All of the following are factors of production EXCEPT
gov't
capital
labor
land
30
Opportunity cost
the same thing as the money price of a good
based on the intrinsic value of the good itself
the value of the next best alternative
the combined value of all the alternatives not selected
31
Most common form of business organization in the United States
corporations
sole proprietorships
monopolies
partnerships
32
Minimum wage is an example of a
monopolistic competition
equilibrium price
price ceiling
price floor
33
A shift of demand occurs when
prices change and the good is a normal good
the amount demanded changes for every price
time is not held constant
price changes
34
Does not provide for everyone's basic needs
traditional economy
command economy
communism
market economy
35
When the US gov't purchases a submarine from a company, the gov't has made a transaction in the
factor market
product market
foreign exchange market
public market
36
Kim works on an auto assembly line. Kim's job illustrates a production process that relies on
autonomous work groups
quality circles
division of labor
team decision making
37
When economists refer to "demand," they mean which of the following?
how much sellers will supply at a particular price
how much consumers will purchase at different prices
how much satisfaction buyers receive a purchase
how much people want the product if it is free
38
For most products and services, an increase in price results in
reduced demand for substitutes
an increase in quantity demanded
increased demand for complements
a decrease in quantity demanded
39
Polypoly is another name for
monopoly
perfect competition
oligopoly
monopolistic competition
40
Manufactured goods needed to produce other goods and services are called
Gross National Product (GNP)
consumer goods
Gross Domestic Product (GDP)
capital goods
41
Develops and enforces environmental standards for air, water, and toxic waste.
EPA
FDA
SEC
EEOC
42
An increase in the price of cameras results in a decrease in the demand for film. Because
they are complements
of a shift of the demand curve to the right
they are substitutes
demand for those products is inelastic
43
Which form of bus. org. = easiest to organize but is LEAST able to benefit from specialization?
limited partnership
sole proprietorship
partnership
corporation
44
The MOST important factor affecting consumer spending is
the expectations of what the economy will be in the future
amt of assets held by consumers (homes, cars, stocks, etc.)
the level of current consumer income
the level of current consumer debt
45
Regulates the sale of stock in a corporation
SEC
FCC
FTC
EEOC
