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Microeconomics
Microeconomics
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Supply and Demand, Market Structures, Types of Businesses, Price Controls, Circular Flow
Flashcards
20 cards
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Questions
20
Answers
1
If the government sets a price
maximum
it is considered a _____ which would cause a ______.
price ceiling; shortage
price floor ; surplus
price floor ; shortage
price ceiling ; surplus
2
When a determinant causes an increase in supply OR demand the curve shifts...
down
right
left
up
3
How are MOST prices established in a market economy?
The government establishes them
Inflation
Price floors or price ceilings
Interaction between producers and consumers
4
Which of the following could have caused the change in the graph above?
change in price of a substitute good
increase in government subsidies
change in consumer taste
decrease in the number of sellers in a market
5
In the circular flow model which market refines the factors of production?
Stock Market
Flea Market
Resource Market
Product Market
6
The law of supply states that if price decreases...
supply decreases
quantity supplied increases
quantity supplied decreases
supply increases
7
Producers would have the LEAST amount of control over a product's price in which type of market
oligopoly
monopolistic competition
monopoly
pure/perfect competition
8
Which TWO market structures are firms considered to be price takers?
perfect competition /oligopoly
perfect competition /monopolistic competition
monopoly/ monopolistic competition
monopoly/oligopoly
9
All of the following are determinants of supply EXCEPT...
change in regulation or taxes
change in price of substitute good
change in producer price expectations
change in technology/education
10
Which type of business model has the benefit of limited liability but the cost of higher taxes?
corporation
monopoly
partnership
sole proprietorship
11
In which market structure does a firm have the
GREATEST
control over the price of a product?
monopolistic competition
monopoly
pure/perfect competition
oligopoly
12
All of the following are determinants of demand EXCEPT...
change in price of complementary good
change in government subsides
change in the number of consumers in the market
change in preference/taste
13
In which market of the circular flow model do finished goods pass from businesses to households
Resource Market
Stock Market
Flea Market
Product Market
14
Which market structure is characterized by having a few firms that are interdependent?
monopoly
perfect competition
oligopoly
monopolistic competition
15
One major disadvantage of a sole proprietorship and a partnership is...
complex organization and hierarchy
limited liability
unlimited liability
higher taxes
16
In which market structure is it important to try and differentiate your product from others?
oligopoly
monopolistic competition
monopoly
pure/perfect competition
17
A government mandated price
minimum
is called a ________ and would create a __________.
price ceiling ; surplus
price ceiling; shortage
price floor ; surplus
price floor ; shortage
18
In which TWO market structures would firms be considered price setters?
monopoly/oligopoly
monopoly/ monopolistic competition
perfect competition/ monopolistic competition
oligopoly/ monopolistic competition
19
The law of demand states that if price increases...
quantity demanded decreases
demand increases
quantity demanded increases
demand decreases
20
Which of the following is NOT one of the three types of business models?
Sole Proprietorship
Corporation
Partnership
Oligopoly
