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Unit 2 Review
Unit 2 Review
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StudBud Administration
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Supply and Demand/Market Structures
Flashcards
33 cards
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Practice quiz
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Questions
33
Answers
1
Why is competition among restaurants in a big city an example of monopolistic competition?
starting a restaurant is expensive
All restaurants serve people, one serves the most people
All restaurants serve food, each is distinctive
restaurants often go out of business
2
Which is most likely to become available in larger quantities as a result of a price increase..
medical doctors
babysitters
airline service
midsize cars
3
In the summer, a rise in the price of burgers may lead to an increase in demand for...
relish
coleslaw
buns
chicken
4
Starbucks has an exclusive contract to sell coffee @ Shenandoah N.P.
Technological Monopoly
Geographic Monopoly
Government Monopoly
Natural Monopoly
5
Which of these would most likely increase the supply of soccer balls?
a government excise tax
an increase in the supply of tennis balls
a transportation strike
a decrease in the prices of raw materials
6
The equilibrium price is the the price at which
demand and supply curves intersect
consumers start reducing demand
neither demand or supply will shift
producers total revenue is the highest
7
Why do goods made in factories that cause pollution, tend to overproduce?
Some people may refuse to purchase the items
Some costs are not charged to the producer
SOme benefits are wanted by the community
Some stores stock more they can sell
8
How is the market clearing price determined?
It is set by government commission
It is calculated by economic analysis
It is reached through trial and error
It is fixed by each manufacturer
9
Which of these is the best example of diminishing marginal utility?
Someone who has a bike has less use for another
People with cars have less use for bicycles
Bicycles become less useful as they start to rust
A shortage of bike paths makes bikes less useful
10
In 1999, Microsoft was an example of this type of Monopoly.
Natural
Geographic
Technological
Government
11
Which of the following would be most helpful in determining the market structure of a market?
how many people want to buy
how similar are the products
how are the corporations organized
How far goods are shipped
12
Supply depends on the willingness and ability of...
consumers to produce
producers to produce
donors to contribute
advertisers to promote
13
As it becomes easier to start new a business in a market, that market...
offers higher-quality products
increases transaction costs
becomes more competitive
attracts more consumers
14
New Deal jobs offered during the Great Depression, were designed to respond to...
a shortage of skills
a surplus of workers
an excess of services
a lack of incentives
15
Which event in FL or CA would shift the supply curve to the left?
an influx of new low wage workers
rise of mango juice as a popular breakfast drink
evidence that citrus fruit strengthens bones
a early frost accompanied by ice storms
16
What is the usual result of setting a price ceiling on rents?
People can find apartments but cannot afford to rent them
Construction jobs increase as people build more apartments
More people want to rent apartments than are available
Houses are broken up into apartments to meet the demand
17
According to the law of supply, what happens as price increases?
quantity supplied decreases
Supply curve shifts to the right
quantity supplied increases
Supply Curve shifts to the left
18
The degree to which the quantity demanded responds to changes in price is called..
revenue
elasticity
unity
schedule
19
In a market with perfect competition, how are prices determined?
by government regulation
By supply and demand
by cultural ideals of fairness
by agreement among producers
20
Which of these might best signal to furniture makers to cut back production?
an increase in availability of skilled workers
a drop in the price consumers are willing to pay
an introduction of competitors into the market
a fall in the cost of essential raw materials
21
New product, successful advertising and low introductory price, what occurs?
equilibrium
shortage
surplus
rationing
22
The Law of Demand states that as quantity demanded decreases...
production increases
wages decrease
quality decreases
price increases
23
Which of these illustrations best illustrates market equilibrium?
Everyone who wants or needs soap can easily afford to buy it
The price of soap does not vary much from week to week
Soap production ensure a good profit for the manufacturer
Amount of soap made matches the amount people want to buy
24
Which of these is the best example of an externality?
Your shoe store stops selling your favorite cycle
You enjoy looking at your neighbors garden
Your new bicycle goes faster than expected
you decide to stop snacking between meals
25
The following graph shows?
Increase in Supply
Decrease in supply
Decrease in demand
Increase in Demand
26
Which of these is most likely to happen to demand when a blizzard keeps customers home
the demand curve becomes flatter
The demand curve shifts to the left
The demand curve shifts to the right
the demand curve becomes steeper
27
In which market structure do producers have the most market power?
Monopolistic Competition
Monopoly
Oligopoly
Perfect Competition
28
The purpose of rationing during World War II was to ensure that...
products would go to those who valued them most
everyone could get essential scarce goods
workers would have an incentive to get jobs
manufacturers could make a profit
29
Quantity demanded moves along the deman in response to changes in...
Preferences
Income
Price
Expectations
30
Selecting a babysitter based on personality and experience is what kind of market?
Monopoly
Oligopoly
Monopolistic competition
Monopoly
31
Why doesn't the market system work to provide street lighting and other goods?
Voters put pressure on local governments
There is no easy way to charge individual users
Too few of these services are available
Important needs cannot be left to chance.
32
Monopolistic competition would be characterized by all of the following except?
Little control over prices
Large number of producers
Difficulty entering the market
Product Differentiation
33
The most important argument many economists make against price controls is that they are..
inefficient
unstable
insecure
unfair
