Which of the following provides the BEST definition of an opportunity cost?

The value of the best alternative not chosen

Oligopoly is a market structure in which:

a small number of firms compete

Two advantages that a market economy has over a command economy are:

more freedom & more efficiency for producers & consumers

If the price of a substitute to good X decreases, then:

the demand for good X will decrease

People overcame the obstacle of economic transactions requiring a double coincidence of wants:

by examining the emergence of money as a medium of exchange

What will be produced, how it will be produced, and for whom will it be produced are:

the fundamental economic questions all economies must answer

A category 5 hurricane hits Florida wreaking havoc with the orange crop. This causes the:

supply curve for orange juice to shift left, price to rise

What will happen in the future if this nation currently operates at point A?

More capital goods will be made adding to economic growth

The difference btwn a private & a public good is an individual's consumption of a public good:

Doesn't take away from another's use of the same public good

The law of demand implies holding everything else constant that as the price of books increases

the quantity of books demanded will decrease

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Economics Units 1 & 2 Review

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Questions 20

Answers

1
Which of the following provides the BEST definition of an opportunity cost?
The value of the best alternative not chosen
The exchange of goods
Giving up something for an item of lesser value
The act of giving up one thing to obtain another.
2
Oligopoly is a market structure in which:
a small number of firms compete
many firms produce a slightly differentiated product
one firm produces a unique product
many firms produce an identical product
3
The study of how firms, nations, and individuals can BEST allocate their limited resources:
supply and demand analysis
economics
factoring production
circular economic activity
4
Two advantages that a market economy has over a command economy are:
more control over prices & wages
more freedom & more efficiency for producers & consumers
more limits on profits & more public goods
more security & more equity for producers & consumers
5
If the price of a substitute to good X decreases, then:
the demand for good X will not change
the demand for good X will decrease
the market price of good X will decrease
the demand for good X will increase
6
People overcame the obstacle of economic transactions requiring a double coincidence of wants:
by examining the emergence of money as a store of value
by examining the emergence of money as a medium of exchange
by examining the emergence of land as a factor of production
by the emergence of labor as a factor of production
7
The flow of resources from consumers to producers is illustrated by the path from:
8 to 6
1 to 3
4 to 2
5 to 7
8
What will be produced, how it will be produced, and for whom will it be produced are:
the ways to influence prices
the fundamental economic questions all economies must answer
the ways governments deal with scarcity
the ways to determine inflation
9
As a public service, police protection may be used by:
Taxpayers only
Anyone who pays service fees
Anyone who needs the service
Citizens only
10
What are the types of economic systems?
Free, communist, mixed
Non-market, mixed, command
Production, market, command
Market, mixed, command
11
We are forced to make choices because:
not everything is limited
we live in a democracy
all resources are limited
shortages are a constant situation
12
A category 5 hurricane hits Florida wreaking havoc with the orange crop. This causes the:
supply curve for orange juice to shift left, price to fall
supply curve for orange juice to shift right, price to fall
supply curve for orange juice to shift right; price to rise
supply curve for orange juice to shift left, price to rise
13
What will happen in the future if this nation currently operates at point A?
Fewer goods will be made, so the curve will shift left
Fewer capital goods will be made to satisfy consumer demand
More goods will be made, so economic growth will be reduced
More capital goods will be made adding to economic growth
14
The difference btwn a private & a public good is an individual's consumption of a public good:
Causes tax rates to decrease
Doesn't take away from another's use of the same public good
Causes a decrease in the price of other public goods
Takes away from another's use of that same public good
15
The flow of goods and services to consumers is illustrated by:
6 to 1
8 to 6
2 to 5
4 to 2
16
Refer to the graph. A legally binding price ceiling would exist at a price of:
$3
$4
$2
None of the above
17
The law of demand implies holding everything else constant that as the price of books increases
the quantity of books supplied will increase
the quantity of books supplied will decrease
the quantity of books demanded will increase
the quantity of books demanded will decrease
18
Refer to the graph. If Price is $10, quantity supplied would be:
20 videos
60 videos
50 videos
30 videos
19
Higher prices and government regulations are both strategies for:
aiding entrepreneurship
increasing consumption
dealing with scarcity
encouraging economic equity
20
Refer to the graph. In this market, equilibrium price and quantity would be:
$8; 30
$6; 40
$4; 50
$4; 30

Economics Units 1 & 2 Review Flashcards | StudBud