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Unit Seven Review! Flashcards | StudBud
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Unit Seven Review!
Unit Seven Review!
60 terms
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StudBud Administration
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19 plays
Covering chapters one and two
Flashcards
60 cards
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Practice quiz
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Host live
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Questions
60
Answers
1
When a market adjusts from imbalance to equilibrium, it is called
Self Correction
impossible
Supply and Demand
Creative Destruction
2
Going to the gym at 5 a.m. each day can be painful/not fun, but it can also be an example of
Maximizing Utility
Behavioral Economics
Self Correction
Deadweight Loss
3
The study of why firms and consumers act the way they do is called
Capitalism
Behavioral Economics
Principal-Agent Problem
Interesting
4
True or False- people acting entirely out of self interest can still benefit a community
False- ecotourism is an example of this
True- ecotourism is an example of this
True- strip mining is an example of this
False- selfish people bring bad things on everyone
5
By putting labels like 'organic' and 'gluten free' and saying that purchases benefit wildlife
This cereal company practices price discrimination
This cereal company makes a barrier to entry
This cereal company minimizes production costs
This cereal company adds value to its product
6
According to the chart, when would a product be at its lowest price?
When the demand is high and the supply is high
When there is no product
When the demand is high and the supply is low
When the demand is low and the supply is high
7
Getting a vaccine or eating more leafy greens to boost one's health are examples of
Maximizing Utility
Incentives
Behavioral Economics
Market Power
8
What are positive impacts of a competitive market where firms seek profit?
Innovation
Creative Destruction (long term)
Creative Destruction (short term)
Toxic Assets
9
The government planned on income tax being an incentive to
Save for retirement
have citizens do their own taxes
Work
Travel Less
10
When government creates unemployment policies, it worries about things like
The free rider problem
Deadweight loss
Securitization
The perverse incentive to not work
11
Uber's surge pricing allows people to access rides during popular times. This is an example of
Free Rider Problem
Communism
Adam Smith's Invisible Hand
Price Discrimination
12
When making clothing, a garment firm needs to add up how much it spends to produce the items.
This is called socialism
This is called self correction
This called real cost
This called market power
13
What is sub prime lending?
Investing money in plans that bet on the market to fail
Bundling loans and selling them to investors
Giving money to people illegally
Lending money to people who don't have good/great credit
14
A state starts taxing cigarettes, so people just buy smuggled ones. This is an example of
A perverse incentive
Smarts
Network Effects
Price Discrimination
15
Benefit Corporations, or B Corps
Provided social security and healthcare to the public
Purchased the ability to pollute more from smaller firms
Were not as important to the government (on the 'B' list)
Were given the ability to focus on things other than profits
16
What does the picture represent?
Amount of product desired and amount the market provides
Amount of happiness and corresponding prices
Amount of product desired and amount of happiness
Amount of faith in market and corresponding prices
17
According to Adam Smith, why do the butcher, brewer, and baker give us their goods?
Creative Destruction
Self interest
Communal Property
Principal-Agent
18
The situation where neither party cooperates even though it is in their best interest to do so
Principal-Agent Problem
Capitalism
The Prisoner's Dilemma
Adam Smith's Invisible Hand
19
How is creative destruction a negative force?
In the short term, people lose jobs/a way of life
In the long term, new industries are created
In the short term, new industries are created
In the long term, people lose jobs/a ways of life
20
How is creative destruction a positive force?
In the long term it creates new industries
In the short term people lose jobs/a way of life
In the short term it creates new industries
In the long term people lose jobs/a way of life
21
A used car salesmen knows that a car is defective, but sells it anyway. This is an example of
Price Discrimination
Supply and Demand
Opportunity Cost
Adverse Selection
22
The author of the book attributes the staying power of Microsoft Word to
Deadweight Loss
Scarcity
Price Discrimination
Network Effects
23
How can a firm make itself more competitive?
Outsource
Automation
Get rid of other firms
Protectionism (like restrict trade)
24
Why does the author of the book say the market can get stuck in a "vicious circle"?
Government policies are ineffective
Self interest leads to positive side effects
It doesn't really self correct
People aren't maximizing their utility
25
A system where everyone owns the means of production and there is no social class or money
Communism
Communal Property
Capitalism
Market
26
Money spent to buy stocks in the hopes that they will grow in value over time is an example of
Communal Property
The Invisible Hand
Opportunity Cost
Supply and Demand
27
A resource that is meant to be used by all is known in economics as
Toxic Assets
Awesome
Communal Property
Supply and Demand
28
When firms outsource, they
Maximize costs of production and send jobs elsewhere
Minimize utility and keep workers where they are
Minimize costs of production and send jobs elsewhere
Maximize utility and keep workers where they are
29
The #1 ingredient in Botox also causes food poisoning. Injecting this in faces can be seen as
Lethal and an example of deadweight loss
Harmful and an example of toxic assets
An investment and an example of securitization
Irrational and an example of behavioral economics
30
Investment bankers can be benefitted by taking large risks. This could lead to
Behavioral economics
The principal agent problem
Market Power
Scarcity
31
The author says that a carbon tax would be paid by all, but who does it affect more?
Politicians because those taxes are unpopular
Rural people because they shouldn't have to pay
The poor because a larger part of their income is taken
Urban dwellers because they're near more pollution
32
Certain people are able to earn huge amounts of money because they reach the masses
Profit/Revenue
Scarcity
Superstar Phenomenon
Network Effects
33
A system where the means of production are mostly privately owned and government is secondary
Capitalism
Socialism
Bonkers
Communism
34
Vine disappeared from the market because it lacked
Network effects
Scarcity
The Superstar Phenomenon
Creative destruction
35
Choose all the things that could be considered luxuries
Potable Water
Nike Air Yeezy Sneakers
Rare Russian Faberge Eggs
Clean Air
36
Maximizing utility can be defined as
When a price increases faster than people's incomes rise
Getting the most satisfaction from the least amount of input
Putting in more input as an investment for the future
the explanation for why a celebrity earns so much money
37
A realtor is motivated to have a buyer pay more for a home since they get some of that money
This is an example of mortgage backed securties
This is an example of creative destruction
This is the principal-agent problem
This is an example of securitization
38
What does the author credit for making sure people like Oprah aren't corn farmers?
Creative Destruction
Supply and Demand
Capitalism
Adam Smith's Invisible Hand
39
When the author talked about taxing red sports cars, he characterized that as
A barrier to entry because not everyone can afford those
Adverse selection because salesmen know more than buyers
Toxic assets because cars lose so much value after purchase
Deadweight loss because no one benefits from the policy
40
A person who abuses resources that are meant for everyone is known in economics as
A jerk
Deadweight Loss
A free rider
A free loader
41
A store that offers frequent customers deals while charging others more is using
Creative Destruction
Price Discrimination
Supply and Demand
Securitization
42
This article talking about the possibly high costs of starting a business shows
Scarcity
Network Effects
The Prisoner's Dilemma
Barrier to Entry
43
If a person refuses to help their mother cook dinner, but still eats the meal, they are
A free loader
so smart
A terrible child
A free rider
44
The large price difference between a Macbook Air and most other netbooks is an example of
Profit
Behavioral Economics
Securitization
Market Power
45
Property that is worth far less than what it was bought for is known as a
toxic asset
deadweight loss
luxury
mistake
46
The many homes sold during the "bubble" became _____________ after the 2008 financial crisis
Communal Property
Deadweight Loss
Toxic Assets
Worthless
47
An example of an incentive can be
The ability to avoid punishment
More payment for more years worked
A tax on cigarettes
A tax break on purchasing a home
48
The stress or happiness gained from a transaction/choice is known in economics as
Barrier to entry
Psychic Benefits/Costs
Opportunity Cost
Profit/Revenue
49
In a cap and trade system, the right to pollute is limited. As a result,
Small firms pollute more to be competitive
Small firms buy more rights to pollute from bigger firms
Large firms buy more rights to pollute from smaller firms
Firms are able to give competitive prices
50
When firms try to minimize productions costs, they are
Attempting to get rid of all competition
Build smaller stores and factories
Attempting to put less in while still making maximum profit
Attempting to get a bigger market share
51
When buyers and sellers mostly interact with little government intervention/planning, that is
Behavioral Economics
A Market Economy
Principal Agent Problem
Creative Destruction
52
1800 Flowers provides flowers especially for international women's day. This is an example of
Free Rider Problem
Adam Smith's Invisible Hand
Principal-Agent Problem
Real Cost
53
The money a person pays for their college education is an example of
Opportunity Cost
Perverse Incentives
Toxic Asses
Profit/Revenue
54
Few crabs in the Bay Area this winter caused a lot of disappointment over New Years.
This is an example of scarcity
This is an example of barrier to entry
This is an example of market power
This is an example of toxic assets
55
Lyft recently donated $1 million to the ACLU- which made many riders happy. This can be seen as
Creative Destruction
Securitization
Adding Value
Free Rider Problem
56
In example of Communist society, everyone was provided with basics like bread, but
People could buy better loaves if they wanted to
Loaves varied widely
it was a lie and most people went without
All loaves were the same and they had to wait in line
57
The market tends to reward
Those who do not compete
Those who are the swiftest, strongest, and smartest
Those who are kind and think first of others
Those who drop out
58
Why does the author say people overuse communal resources like rhino horns?
People want to preserve the rhinos, so they kill them
People make money off of safaris, so they preserve rhinos
People are afraid others will get more than them
They are valuable and people want to get the most
59
What is a concern with the government's social security policy?
Market Power
Youth's barrier to entry (they're too young to benefit)
The superstar phenomenon where stars won't pay
The perverse incentive to not save for retirement
60
Home loans that were bundled and sold to investors were called
Mortgage Backed Securities
Markets
Communal Property
Deadweight Loss
