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FULL 2023 Economics Final Flashcards | StudBud
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FULL 2023 Economics Final
FULL 2023 Economics Final
65 terms
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1
31. What is the income effect?
An increase in purchase of complements based on an increase in income
A proportional change in quantity demanded based on income
A change in demand caused by substitution
A change in quantity demanded caused by a change in consumer income
2
11. How is the principle of, “There’s No Such Thing as a Free Lunch”, illustrated in a socialist economy?
They tend to offer extensive government services but have high tax rates
The policies offer advantages to the wealthy at expense of less well-off
Socialist economies tend to collapse when they become too large
The marketplaces in a socialist economy are free for anyone to enter
3
50. What do price ceilings and price floors prevent?
Shortages
Surpluses
Benefits to consumers
Prices reaching equilibrium
4
Which two terms are the most similar in meaning?
Variable costs and overhead
Marginal costs and variable costs
Fixed costs and overhead
Marginal costs and fixed costs
5
57. A woman borrows bank $ to buy a house & will give the bank the house if she cannot repay loan. This woman signed a -
Mortgage
Trust
Cease and desist order
Foreclosure
6
25. Protection from layoffs, illnesses, injuries or disabilities falls under the goal of:
Economic growth
Economic efficiency
Economic security
Economic equity
7
13. Who did Karl Marx believe would be the beneficiaries of socialism?
Property owners
Workers
Capitalists
The Government
8
9. The efficient use of scarce resources is called:
Investment
Capital
Scarcity
Productivity
9
38. Which term best describes costs that are incurred regardless of a firm’s rate of production?
Fixed costs and overhead
Variable costs and overhead
Variable costs and total costs
Fixed costs and total costs
10
21. Consumers in a free enterprise economy ultimately determine _______ to produce.
Where
When
How
What
11
39. Labor in a factory is an example of which of these?
A marginal cost
A fixed factor of production
A variable factor of production
A diminishing return
12
47. In a competitive market economy, prices are considered:
Favorable
Neutral
Uncompromising
Dictated
13
19. _______ protect consumers against harm from products on the market.
Profit motive
Government regulations
Franchises
Private property rights
14
28. Changes in quantity demanded and changes in price have a(n) _________ relationship.
Inverse
Indirect
Neutral
Positive
15
37. Which of these would an item’s producer be most likely to do if total revenue on that item began to drop?
Raise the price of that item
Produce less of that item
Produce more of that item
Lower the price of that item
16
12. Which of the following states an advantage of a traditional economy?
Property rights are based on tradition
Creativity and original thought are rewarded
Everyone knows exactly what their function is
There’s no bureaucracy to interfere with organizing the economy
17
24. A general rise in the level of prices over time is known as:
Voluntary exchange
Profit
A catalyst
Inflation
18
51. Which term best describes rent control?
Price ceiling
Nonrecourse
Equilibrium price
Subsidy
19
2. When a nation’s total output increases over time, it is experiencing:
Economic interdependence
Economic growth
An expansion of the possibilities curve
Decrease in gross domestic product
20
48. Equilibrium is reached when what occurs?
Quantity supplied equals quantity demanded
there is no change in the quantity supplied
Prices are inelastic
Price increase
21
5. Which of the factors of production involves taking risks and combining resources to produce a good?
Labor
Land
Entrepreneurs
Capital
22
8. Which of the following descriptions best explains the meaning of opportunity cost?
The cost of business failures
The risk associated with producing a new item
The cost of choosing one alternative over another
The initial cost of starting a new business
23
62. Limited life applies to:
Nonprofit organizations
Sole proprietorships
Multinationals
Corporations
24
16. Which of these countries has an economy most similar to that of the former Soviet Union?
South Korea
North Korea
Sweden
Norway
25
40. Which of these is an example of a variable cost?
Interest on bonds
State and local property taxes
Raw materials
Payments on leased properties
26
20. Which of the following is largely responsible for the growth of a free enterprise system?
Market efficiency
Profit motive
Gross Domestic Product
Government
27
61. Under perfect competition, what sets the equilibrium price in the market?
Non-price competition
A monopoly
The government
Supply and demand
28
49. Which is the opposite of a surplus?
Floor
Shortage
Equilibrium
Inelastic
29
32. Which would an economist consider a likely substitute for coffee?
Chicken
Donuts
Tea
Water
30
15. Which of these economic systems have the least in common?
Market economy and capitalism
Free-enterprise economy and market economy
Command economy and capitalism
Command economy and socialism
31
17. One of the characteristics of a capitalist free enterprise economy is:
Central planning
Consumerism
The minimum wage
Voluntary exchange
32
33. A change in quantity demanded is represented by:
A shift of the demand curve
Substitution
Movement along the demand curve
Complements
33
56. In the economic term oligopoly, the word part olig-probably means:
“All”
“Few”
“One”
“Single”
34
55. Which of the following factors contribute to market failure?
Knowledge of prices and opportunities
Mobility of resources
Adequate competition
Inadequate competition
35
46. What do low prices signal buyers to do?
Buy more
Substitute
Buy less
Nothing
36
43. Which term denotes the change in total income when one additional unit of output is added?
Change in supply
Total product
Marginal revenue
Supply schedule
37
63. A business net income is defined as:
Total income after expenses
Total expenses before sales
Total dividends paid to investors
Total sales before expenses
38
53. The Sherman Act, the Clayton Act, and the Federal Trade Commission Act were all designed to:
Extend mortgages
Create public goods
Ensure competition
Promote trusts
39
Paradox of value refers to the:
High value of a nonessential item and the low value of an essential item
High value of an essential item and the low value of a nonessential item
Contradiction of what consumers want and what they need
Contradiction between gross domestic product and market value
40
41. At which stage of production does the concept of “diminishing returns” first become significant?
Stage II
Stage III
It is significant throughout the production process
Stage I
41
30. On a demand curve, movement along the curve, as opposed to a shift in the entire curve, is a result of:
A change in demand
A decrease in demand
An increase in demand
A change in price
42
35. What is the relationship between income and demand?
A decrease in income increases demand
An increase in price increases income
A decrease in price decreases income
An increase in income increases demand
43
14. Which of these statements describes a disadvantage of a traditional economy?
New ways of doing things are discouraged
Everyone knows his or her role
Difficult economic decisions are made by the state
New ways of doing things are encouraged
44
65. When two companies that produce the same kind of product merge, this is called a:
Multinational merger
Horizontal merger
Conglomeration
Vertical merger
45
22. What gives people and businesses the opportunity to make their own decisions?
Command economy
Profit motive
Economic freedom
Free enterprise
46
34. What is the main cause of a change in quantity demanded?
Changes in revenue
The income effect
Substitution
Change in price
47
64. A venture capitalist’s main goal is usually to:
Help individuals achieve their dreams
Teach entrepreneurs managerial skills
Get a good return on an investment
Help their communities
48
58. How would an economist characterize a local government increasing property taxes to improve the public schoolsystem?
A cease and desist order
Laissez-faire in action
Subsidizing a positive externality
An example of collusion
49
10. What kind of economy offers uniformity in wages regardless of individual productivity?
Command and socialist economies
Market and free-enterprise economies
All economies
Traditional Economies
50
The most comprehensive measure of a nation’s wealth is provided by its:
Gross domestic product
Product possibilities curve
TINSTAAFL rating
Capital goods
51
54. When a factory pollutes a river, the resulting water pollution is an example of:
Technological monopoly
Neutral spillover effect
Negative externalities
Public good
52
59. Which is an example of a public good?
A rock band
A car
The U.S. Army
Bread
53
36. Which of the following replaces a costly item with a less costly one?
Change in demand
The income effect
Consumer taste
The substitution effect
54
52. The U.S. has a “modified” free enterprise economy b/c almost everything we do & everything we buy is affected by
Government
Inventors
Business
Money
55
27. What are the characteristics of demand?
The desire and ability to buy a product
The desire, ability, and willingness to buy a product
The ability and willingness to buy a product
The willingness and desire to buy a product
56
18. The economic system of the United States is considered a:
Free market capitalist economy
Socialist economy
Traditional economy
Command economy
57
42. At which point in the stages of production does the maximum profitable number of workers become most apparent?
The beginning of Stage I
The end of Stage III
The end of Stage I
The beginning of Stage III
58
4. Societies are faced with which three basic questions about production of goods?
When, where, and for whom
What, where, and when
What, how, and for whom
What, how, and why
59
60. Pure competition and monopoly:
Are opposites
Should not be compared
Are the same
Are almost the same
60
3. When a business needs to decide whether a certain action is worth the cost, the most helpful analysis would be:
Production possibilities curve
Cost-benefit analysis
Needs assessment
Economic model
61
6. A nation’s wealth is determined by its:
Accumulation of all tangible and intangible resources
Natural resources
Accumulation of tangible resources
Product possibilities frontier
62
26. Which of the following is currently considered one of the seven major economic and social goals in the U.S?
Conservation
Price stability
Clean environment
Preserving endangered species
63
29. A hungry man is willing to pay a high price for food. Once no longer hungry he is not willing to pay the same price.
A complement
The substitution effect
Unit elasticity
Diminishing marginal utility
64
23. The phrase "the customer is always right" is most often associated with what term?
Regulatory government
consumer sovereignty
Mixed economy
entrepreneurship
65
45. Which term is generally associated with machines and other capital goods?
Total cost
Marginal cost
Fixed cost
Variable cost
