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Economics Final Review
Economics Final Review
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Review for Economics final
Flashcards
61 cards
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Practice quiz
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Questions
61
Answers
1
Business org. that combine 2 or more people’s specialities with equal decision-making power
Propriertorship
Franchise
Partnership
Corporation
2
Higher per-unit production costs would cause producers to
Want to produce more
Supply more
Hire more workers
Supply less
3
If there are few or no substitutes for a good, then which of the following is true?
The demand would not change
The demand would be inelastic
The supply would be elastic
The demand would be elastic
4
Debit cards are included in the money supply under the category of
Traveler’s checks
Credit cards
Currency
Checking accounts
5
A supply schedule includes
Price and quantity supplied at each price
Movements along the curve
Shifts to the left or right of the supply curve
The producer‘s cost
6
Factors responsible for economic growth, causing a PPF to shift to right, include
More natural resources and labor
All the above
Capital investment and increased human capital
Technological advances and incentives
7
If the number of buyers in the market increases, which of the following will happen?
The supply in the market will decrease
The demand in the market will increase
The demand in the market will decrease
The supply in the market will increase
8
A negative externality
Has an adverse effect on the producer
Has an adverse effect on the consumer
Has an adverse effect on a third party
Affects everyone equally
9
Minimum wage is
Both a and c
An equilibrium
A government-set wage floor
A government-set wage ceiling
10
Economists believe that people respond to
The wishes of the government
Requests from policy makers
Speeches from politicians
Monetary incentives
11
Another word for marginal is
Modified
Additional
Edge
Summarized
12
Which of the following is a public good?
Beauty shop
Hamburger
Car
Post office
13
Economists agree that the role of government is to
Charge consumers a large amount of taxes
Produce and economic plan for production
Enforce contracts and produce non-excludable public goods
Produce excludable public goods
14
The Knights of Labor
Includes a large number of skilled workers today
Was formed under the leadership of Samuel Gompers
Was the first Union organized in 1869
Was the first union formed in England
15
A market is any place
Where only sellers offer goods for sale
With a sign designating a store
Where buyers and sellers meet
Where fruits and vegetables are sold
16
On a demand curve, a change in quantity demanded is represented by
A movement along the curve
A shift to the left
All the above
A shift to the right
17
When additional units cannot be produced or there is no time to produce more, the supply curve
Is upward slopping, left to right
Will shift
Is horizontal
Is vertical
18
The owners of a corporation are
It’s board of directors
It’s employees
It’s stockholders
It’s president, secretary, and treasurer
19
A decrease in the average level of prices is called
Deflation
Inflation
Depression
Recession
20
After currency, the next largest component of the money supply is
Gold
Demand deposits
Savings account
Credit cards
21
Quantity supplied changes because of
Advances in technology
A change in price
A change in resource prices
Superior workmanship
22
Quantity supplied refers to
The amount demanded at a particular price
A shift of the supply curve to the right
The amount supplied at a particular price
A shift of the supply curve to the left
23
When a bank makes a new loan of $1,000, then
The money supply decreases by $100
The money supply is unaffected
The bank owes the Fed $1,000
The money supply increases by $1,000
24
In a socialist economic system, the government
Pays little attention to income distribution
Owns and controls many of the resources
Rents resources to the people
Owns and controls the people
25
A direct relationship exists when
Change in price causes supply curve to shift to the right
Price & quantity supplied move in the same direction
Price & quantity supplied move in opposite directions
Change in prices causes supply curve to shift to the left
26
Stagflation is a combination of
Low taxes & low government spending
High inflation & high unemployment
Hugh inflation & high employment
High taxes & high government spending
27
A supply curve is a reflection of
What suppliers are willing and able to produce
What consumers are able and willing to purchase
What the demand schedule lists
What suppliers purchase from their input sources
28
Which of the following is an intermediate good?
A tractor purchased by a farmer
Steel purchased by General Motors
Milk purchased by your parents
A Coke purchased by a high school student
29
If minimum wage is set above the equilibrium wage rate, it will
Result in employers being willing to hire fewer workers
Cause a shortage in the labor market
Result in fewer workers entering the labor market
Shift the demand curve for labor to the right
30
The demand for labor could decrease if
There is a decrease in demand for products that workers made
The products that workers make become popular
There is a decrease in the number of foreign workers
There is a decrease in the supply of labor available
31
A production possibilities frontier shows
All possible combinations of 2 goods an economy can produce
All viable combinations of all goods an economy can produce
All the possible production of 1 particular good
All possible combinations of 4 goods an economy can produce
32
A business organization that can conduct business in its own name and own property is a
Proprietorship
Corporation
Partnership
Franchise
33
Which of the following is an externality?
A neighbor’s dog barking
Pollution from a local factory
A neighbor landscaping his yard
All of these
34
Businessess prefer to produce
Excludable private goods
Nonexcludable private goods
All of these
Nonexcludable public goods
35
National defense is an example of a
Private good
Negative externality
Positive externality
Public good
36
If a decrease in income increases the demand for a good, the good is
A complement
Normal
A substitute
Inferior
37
When GM purchases new automated equipment for use in building cars, it would called what in GDP
Consumption
Investment
Government purchases
Export spending
38
The government will provide nonexcludable public goods and pay for them with
Savings
Interest
Bonds
Taxes
39
Opportunity cost is most similar to
A trade-off
All the alternatives forfeited
Your choice
The dollar value given up
40
M1 does
not
include
Nonchecking savings account
Currency
Traveler’s checks
Checking accounts
41
As the opportunity cost of college increases compared to the benefits, a person is
Less likely to attend
Unaffected by the change
Cannot predict
More likely to attend college
42
We refer to the Fed as the central bank because it is
The chief monetary authority in the country
Between Canada and Mexico
Located in the middle of the country
The most important bank in the world
43
Illegally produced goods and services are
Included when the illegal income is reported on tax forms
Excluded from GDP
Included in GDP from actual figures reported & estimation
Included if they can be measured
44
If the government increased spending by $1 billion and crowding didn’t occur, we would expect
Reductions in private spending
Total spending in the economy to fall
Total spending in the economy to rise
No impact on total spending in the economy
45
Which of the following is true if the money supply decreases?
Output of goods and services rises before prices rise
Prices fall before output rises
Prices rise before output rises
Output of goods and services falls before prices fall
46
A good is excludable if
The government regulates whether or not you may use it
1 person‘s use of the good reduces another‘s enjoyment of it
People can be prevented from using it
It is produced by a private firm
47
Scarcity exists because
Wants are unlimited and resources are unlimited
Wants can be satisfied and resources are unlimited
Resources are limited and wants are unlimited
Resources are limited and wants are limited
48
Illegal transactions take place in what economists refer to as the
Underground economy
black market
Nonmarket economy
Criminal economy
49
A change in quantity demanded can be caused by
Income
Price of a substitute
Preferences
Price
50
With globalization, the world is moving toward
One large economy
Three powerful economies
50 dominant economies
10 major economies
51
To an economist,
capital
refers to
Machinery and tools
Resources found in nature
Money
New business opportunities
52
When deciding whether or not to increase production, a business owner should consider
Fixed costs
Total costs
The average cost of additional units
The marginal cost of additional units
53
When you save your cash in a piggy bank, you are using money as a
Store of value
Unit of account
Method of borrowing
Medium of exchange
54
When only a few producers & their products dominate an industry, the market structure is called
Oligopolistic
Monopolistic
Perfectly competitive
Monopolistic competitive
55
The objective of fiscal policy is to
Reduce interest rates & increase the money supply
Raise interest rates & decrease the money supply
Increase total spending & reduce unemployment
Increase total spending & increase unemployment
56
The opportunity cost of something is
More costly to the poor
What you give up to get the item
The dollar value of the item
Less than the dollar value of the item
57
Resources are owned & contolled by private individuals in what type of economic system?
A free enterprise or market economic system
A socialist economic system
A communist economic system
A traditional economic system
58
A
free rider
is a person who
Receives the benefit of a good but doesn’t pay for it
None of the above
Buys a good at a discount price
Receives the benefit of a good and pays full price
59
When there’s a mild decline in real GDP for a short period of time, it is called a
Peak
Expansion
Depression
Recession
60
The prices consumers pay are determined by
Markets
Producers
Chance
Advertising
61
If the demand for computers increases, the demand curve will
Shift to the right
Go up
Go down
Shift to the left
