businesses are customers and individuals are producers

Why do consumers benefit from imports?

selection of goods increases and prices decrease

willingness and ability of producers to offer goods and services for sale

If new restaurants open and that causes the supply curve for burgers to shift right, what can you conclude?

an increase in the number of producers increased supply

What is the difference b/w fixed and variable costs?

fixed costs remain the same; variable costs depend on how much is produced

What do producers have to do as a result of cost-push inflation?

raise prices to maintain profits

What is an advantage of a pure market economy?

allows communities to set their own economic development

What should an investor do before choosing among investment options?

determine an investment objective

What is the best measure of a nation's economic growth?

the amount of change in its real GDP

What is one of the greatest advantages of a mutual fund?

allows individuals without a lot of $ to own a variety of financial assets

Given a RIGHTWARD shift of a demand curve for jeans, what can be concluded?

advertising increased demand for jeans

How are stock prices determined?

the market forces of supply and demand

What is a helpful guideline for investing?

the longer you have to invest, the more risk you can take

the Federal Reserve System is

12 regional banks with a central decision-making board

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Economics Final Review

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Questions 25

Answers

1
idea that countries gain when they produce items they are most efficient at producing & are at the lowest opp cost
law of trade advantage
law of comparative advantage
law of economic advantage
law of absolute advantage
2
In a factor market
individuals are customers and businesses are producers
businesses sell productive resources
individuals buy goods and services
businesses are customers and individuals are producers
3
Why do consumers benefit from imports?
selection of goods and prices both increase
selection of goods decreases and price increases
selection of goods and prices both decrease
selection of goods increases and prices decrease
4
A situation in which producers in one nation depend on others to provide goods & services they do not produce is called
economic interdependence
trade interdependence
corporate interdependence
international interdependence
5
What is supply?
willingness and ability of the gov to offer protections to citizens
willingness and ability of producers to offer goods and services for sale
willingness and ability of laborers to work for producers for pay
willingness and ability of consumers to purchase goods and services
6
If new restaurants open and that causes the supply curve for burgers to shift right, what can you conclude?
a drop in input costs caused producers to increase supply
competition drove one of the restaurants out of business
a drop in the number of producers decreased supply
an increase in the number of producers increased supply
7
What is the difference b/w fixed and variable costs?
fixed costs are always low; variable costs are always high
fixed costs depend on outside forces; variable costs depend on internal
fixed costs remain the same; variable costs are determined by fixed costs
fixed costs remain the same; variable costs depend on how much is produced
8
What do producers have to do as a result of cost-push inflation?
lower prices to increase profits
raise prices to produce more goods
lower prices to produce more goods
raise prices to maintain profits
9
With monopolistic competition there are
few buyers and many sellers
many buyers but few sellers
few sellers and few buyers
many buyers and many sellers
10
What is an advantage of a pure market economy?
has mechanisms for providing public goods
prevents unequal distribution of wealth
allows communities to set their own economic development
provides security to those who are not economically productive
11
What should an investor do before choosing among investment options?
read a financial newspaper
consult a stockbroker
determine an investment objective
hire a financial analyst
12
A factory closes, laying off hundreds of workers and consumer spending in town falls. What factor is affecting demand?
consumer taste
substitutes
consumer expectations
income
13
Which of the following can change supply?
input costs
income
equilibrium
substitutes
14
What is an effect of inflation on the economy?
decreasing interest rates
decreasing value of the dollar
decreasing unemployment
increasing returns on savings
15
What is the best measure of a nation's economic growth?
the amount of change in its population
the amount of change in its imports
the amount of change in its taxes
the amount of change in its real GDP
16
What is one of the greatest advantages of a mutual fund?
allows individuals to move investments from money markets to capital market
specializes in the stock of companies on the Dow Jones Industrial Average
is traded on the NASDAQ rather than on the New York Stock Exchange
allows individuals without a lot of $ to own a variety of financial assets
17
Government plan to reduce demand and slow the economy
stabilizing fiscal policy
contractionary fiscal policy
discretionary fiscal policy
expansionary fiscal policy
18
Given a RIGHTWARD shift of a demand curve for jeans, what can be concluded?
advertising increased demand for jeans
advertising decreased the demand for jeans
advertising did not affect the demand for jeans
jeans advertising misled customers
19
How are stock prices determined?
the valuation made by corporate auditors
the ruling of the Securities and Exchange Commission
the market forces of supply and demand
price fixing by workers at the stock exchanges
20
According to the law of supply, when price increases
quantity supplied increases
demand increases
supply increases
quantity demanded increases
21
Which age group is most severely affected by unemployment during and economic slowdown?
middle-aged
elderly
the late middle-aged
young
22
Which of the following examines the costs and expected benefits of a choice?
cost-profit analysis
choice-benefit analysis
cost-benefit analysis
choice-profit analysis
23
What is a helpful guideline for investing?
invest in stocks before paying off credit card debt
if you have a low income, you must worry about tax liability first
the longer you have to invest, the more risk you can take
the less time you have to invest, the more risk you should take
24
the Federal Reserve System is
an agency in Washington, DC, that must approve all banking policies
12 regional banks with a central decision-making board
a network of local banks with a special national charter
a set of vaults used to store the national treasury
25
What are the 2 basic tools the gov uses to influence the economy?
taxation and wages
entitlements and spending
entitlements and wages
taxation and spending

Economics Final Review Flashcards | StudBud