Which scenario best illustrates the law of diminishing marginal utility?

Each additional piece of pizza you eat is less satisfying than the previous

Being paid with food for fixing a toilet

The main benefit of free trade between two countries is that

Each country can consume beyond its constraints of resources & productivity

What is a future incentive?

Doing something now to improve your future

Any point inside a PPC is

Associated with inefficient use or unemployment of some resources

What are the 3 fundamental economic questions that every society must answer?

What to produce, who to produce for, and how?

What is the law of unintended consequences?

Actions often have unforeseen effects

What is an incentive?

Used to motivate people to do certain things

studbud

Regular Econ Final Exam Review Part I

30 termsStudBud Administration215 plays

Imported from external platform

Flashcards30 cardsFPractice quizPHost liveL

Questions 30

Answers

1
A cost that falls on someone other than the producer or consumer is called a
Internality
Positive externality
Externality
Negative externality
2
Which scenario best illustrates the law of diminishing marginal utility?
Someone who doesn’t listen to music does not care about getting a new CD
Something continuously improves over time
Each additional piece of pizza you eat is less satisfying than the previous
A car breaks down more often as it gets older
3
Why are tradeoffs necessary?
Resources are limited
Every product has flaws
Trade makes us all wealthier
People want different things
4
The difference in earnings by different groups of people doing the same work is...
Affirmative action
Wage gap
GDP
Fringe benefits
5
What is it called when the market is not at equilibrium?
Market clearing price
Unbalanced revenue
Disequilibrium
Equilibrium
6
What is a barter?
The place where you get your haircut
Working for money
Being paid with food for fixing a toilet
Trading money for a good
7
If there is a shortage of a product, what will a company do to get the price to equilibrium?
Lower the price
Make less of the product
Raise the price
The situation depends on the product
8
If the demand elasticity equation is greater than one, demand is said to be:
Elastic
Inelastic
Rigid
Unit elastic
9
The law of demand states that “as the quantity demanded decreases...
prices increase
production increases
quality increases
wages decrease
10
If the demand elasticity equation is less than one, demand is said to be:
Elastic
Rigid
Unit elastic
Inelastic
11
What a new business has to pay before producing products is...
Fees
Start-up costs
Opportunity costs
Taxes
12
A price ceiling causes a:
Surplus
Market equilibrium
Shortage
Factors of production
13
The main benefit of free trade between two countries is that
Neither country gains anything
Income distribution in each country will become more equitable
Migration from one country to the other will increase
Each country can consume beyond its constraints of resources & productivity
14
Price floors always cause a:
Shortage
Market equilibrium
Surplus
Free market
15
What do you gain by adding one more unit of a good?
Marginal Benefits
Subtracted Good
Benefits
Tradeoff
16
What is the only determinant that will shift the point along the demand curve?
Change in producer's expectations
Change in technology
Change in price
Change in government policies
17
What is the production equation? (think factors of production)
Production + Labor + Working Hours
Land + Labor + Capital
Products + Labor + GDP
Inputs + Outputs + Labor
18
Supply relies on the willingness and ability of:
Producers to produce
Advertisers to promote
Donors to donate
Consumers to purchase
19
Minimum wage is considered a:
nonprice competition
price floor
factor of production
price ceiling
20
What is a future incentive?
Doing something now to improve your life today
Doing something tomorrow for instant gratification in the future
Doing your homework tomorrow instead of today.
Doing something now to improve your future
21
When the price goes up supply:
depends on demand
decreases
does not change
increases
22
If making each additional unit of good X required giving up increasing amounts of good Y, the PPC between X and Y is...
A straight line
Bowed inward
A circle
Bowed outward
23
What kind of economy is the United States?
Market
Traditional
Mixed
Super
24
Any point inside a PPC is
Unattainable
Associated with inefficient use or unemployment of some resources
Better than points on the PPC
Associated with movements along the PPC
25
What are the 3 fundamental economic questions that every society must answer?
What to produce, who to produce for, and how?
Where to produce, when to produce, and why?
What to produce, when to produce, and how?
Who should produce, what to produce, and how?
26
Factors that make it difficult for new firms to enter a market are called...
start-up costs
economies of scale
barriers of entry
licenses
27
What is the law of unintended consequences?
Markets are always influenced by emotional factors
Economic booms are always followed by downturns
Land + Labor + Capital
Actions often have unforeseen effects
28
What is an incentive?
Something worth one penny (in-CENT-ive)
What you gain by adding one more unit
What you give up for another action
Used to motivate people to do certain things
29
If supply decreases, then what way does the supply curve shift?
Right
Left
Up
Down
30
An effective (binding) price floor is always located ___________ equilibrium.
Next to
Above
Below
On top of

Regular Econ Final Exam Review Part I Flashcards | StudBud