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Econ Unit 2 - Microeconomics Flashcards | StudBud
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Econ Unit 2 - Microeconomics
Econ Unit 2 - Microeconomics
27 terms
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supply, demand, circular flow, biz orgs, mkt structures
Flashcards
27 cards
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Questions
27
Answers
1
What is the relationship between quantity supplied and price?
They are not related.
They are directly related.
They are related through demand.
They are inversely related.
2
Why would a business want to differentiate their product?
to attract customers
to provide their customers with a better product
to charge a higher price for their good
to force competitors out of business
3
To be considered part of a perfectly competitive market,
your actions essentially have no effect on the market price.
your actions are quickly followed by competitors.
incr in price of your product have an impact on mkt price
your pricing has no impact on the amount you can sell.
4
Unlimited life is an advantage of what type of business
sole proprietorship
partnership
corporation
5
What economic situation is represented in the graph?
price floor; surplus
price ceiling; surplus
price floor; shortage
price ceiling; shortage
6
This market structure has complete control over the market.
oligopoly
monopolistic competition
monopoly
pure/perfect competition
7
Which of the following would cause the demand curve for a product to shift to the right?
an increase in the price of a complement
an increase in population of Forsyth County
a decrease in the price of a substitute
decrease in popularity of milk
8
The supply curve is generally:
completely vertical
negatively sloping (downward)
positively sloping (upward)
perfectly horizontal
9
What would happen to the graph for Coca-Cola if the price of Coca-Cola goes up from $1 to $1.25
There would be no shift
Demand would shift right
Demand would shift left
Supply would shift left
10
Which type of business incurs double taxation
sole proprietorship
corporation
partnership
11
Lack of expertise in different areas is a major disadvantage for which form of business
partnership
sole proprietorship
corporation
12
A decrease in resource prices will:
Decrease equilibrium price and quantity
Increase equilibrium price and decrease equilibrium quantity
Increase equilibrium price and quantity
Decrease equilibrium price and increase equilibrium quantity
13
As an investor you can buy part ownership in the corporation, by obtaining
bond
common stock
dividend
certificate of ownership
14
Refer to the diagram. Line (6) represents:
wage, rent, interest, and profit income.
land, labor, capital, and entrepreneurial ability.
consumer expenditures.
goods and services.
15
Why would a partnership have greater access to financial capital than a sole proprietorship?
they last longer so banks are more willing to lend them $$
Each partner invests money into the partnership.
A partnership can sell bonds in order to raise cash.
A partnership can sell stock.
16
What is the economic situation created in the graph below?
Price Floor: Shortage
Price Ceiling; Shortage
Price Ceiling; Surplus
Price Floor; Surplus
17
This market that has a few large suppliers of goods.
monopolistic competition
pure/perfect competition
monopoly
oligopoly
18
Unlimited liability is best represented by which letter
D
C
A
B
19
If the price of coffee decreases from $2 to $1, what will be the result?
quantity demanded will increase from 30 to 50
quantity demanded will increase from 30 to 40
demand will decrease from 50 to 30
demand will increase from 30 to 50
20
Dividends are taxed both as corporate & personal income to stockholders is a major disadv of
sole proprietorships
partnerships
corporations
21
The supply curve of a product normally decreases if:
the cost of inputs decreases
the price of the product increases
taxes on the product increase
more producers enter the market
22
Steel Beam Inc. purchases a new steel-processing machine. In the circular flow diagram, this transaction takes place in
Product Market
Consumer Sector
Factor Market
Business Sector
23
The easiest and most simple way to start a business is in the form of a ______?
non profit
corporation
partnership
sole proprietorship
24
This type of market structure has many buyer and sellers of identical products
monopolistic competition
monopoly
oligopoly
pure/perfect competition
25
In the circular-flow diagram,
income from factors flows from firms to households.
factors of production flow from firms to households.
spending on goods flows from firms to households.
goods and services flow from households to firms.
26
In the product market businesses…..
sell goods and the households purchase the goods
buy the factors of production and households sell products
buy the factors of production and households sell them.
sell the factor of production and households purchase them
27
Which line on the Circular Flow Diagram? Jane pays $30 for a pair of shoes.
3
4
2
1
