This is an example of a negative externality

air pollution from a paper company

The government is allowed to intervene in the US economy because

Citizens agree the role is justified because the benefits outweigh the cost

What is NOT a disadvantage of pure capitalism

businesses are not free to make their own decisions

Price floors are enacted to

support a minimum price for a good

An example of microeconomics would be

A dad buying generic brand bread to save money

What must be present in order to generate demand

BOTH ability to buy and willingness to buy

Price ceilings are enacted to

Ensure that certain goods are available to all people

In free enterprise, competition is generally good for the consumer because

it ensures a high quality product at the lowest prices

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Econ Final Schunk

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Questions 31

Answers

1
This is an example of a negative externality
employee-sponsored health care
public art and cultural events
environment conservation
air pollution from a paper company
2
The government is allowed to intervene in the US economy because
all of the above
the government provides services more efficiently than the private sector
The US economy is a traditional economy
Citizens agree the role is justified because the benefits outweigh the cost
3
how does the government deal with externalities
Both Red and Yellow
Often imposes taxes on negative externalities
proves subsidies for those businesses that provide positive externalities
let the free market adjust to them
4
Almost all economic systems are:
Market
Command
fixed
Mixed
5
What is NOT a disadvantage of pure capitalism
basic services such as food and medical care are not guaranteed
The economy doesn't provide for everyone
job insecurity
businesses are not free to make their own decisions
6
The extra usefulness one gets when acquiring or using a good or service
decreasing marginal utility
marginal revenue
marginal utility
manual labor
7
This occurs when the employee and the employer come together to negotiate conditions of employment
injunction
mediation
collective bargaining
arbitration
8
this is a combination of firms that is designed to reduce competition
oligopoly
Cartel
none of the above
trust
9
A businesses market structure is determined by the:
it competition
the pay of its employees
Supply of its product
the location of the company
10
payment for which the government receives nether goods nor services in return:
flat tax
value added tax
earmarks, pork
transfer payments
11
Why diversification in your investment portfolio important
ensure that some assets can by liquidated quickly (turn into cash)
all of the above
helps manage risk
limits your tax liability
12
In order for pure competition to exists:
all of the above
freedom of entry and exit into and out of the market
identical products offered
There has to be a large number of sellers and buyers in the market
13
Price floors are enacted to
to move services to those who are willing to spend the most
run off competitors from coming into the market
support a maximum price for a good
support a minimum price for a good
14
What is the law of supply
both red and blue
price rises when demand decreases
price rises when demand rises
price will not change with demand on elastic goods and services
15
How is a shortage dealt with
prices increase
production decreases
prices decrease
prices remain the same
16
What is an example of a need
shelter
video games
300-dollar Jordan 1
sports tickets
17
A market system is also known as a:
traditional economy
mixed economy
capitalistic economy
command Economy
18
Which good is the MOST inelastic
internet
gym membership
insulin
potato chips
19
The best example of a natural monopoly would be:
ford motor company
standard oil
nike
public utilities
20
Which good would be the MOST elastic
Gucci bag
medicine
Gasoline
insulin
21
An example of microeconomics would be
Falling Teenage Employment Predictions
Government placing trade embargos
A dad buying generic brand bread to save money
Implementation of a new tax policies to discourage a behavior
22
John's dad gives him a small loan of a million dollars to start his sponge company. John's dad would be considered
A good dude
venture capitallists
Angel Investor
proprietor
23
What must be present in order to generate demand
ability to buy
hope to buy
willingness to buy
BOTH ability to buy and willingness to buy
24
The decision of whether to hire people to work or use machinery to produce is an answer to what question?
How should it be produced?
When should it be produced?
What should be produced?
Why should it be produced?
25
Exchanging one item for another would be called a(n)
Barter
Opportunity Cost
Trade off
depreciation
26
Price ceilings are enacted to
protect producers
encourage consumers to not buy products
restrict access to essential goods
Ensure that certain goods are available to all people
27
How is a surplus dealt with
prices falls
prices remain stagnant
production rises
prices rise
28
In free enterprise, competition is generally good for the consumer because
reduces the amount of waste in nonrenewable resources
ensures that workers will be paid a fair wage
it ensures a high quality product at the lowest prices
ensure that all producers will stay in business
29
What is NOT a factor that could affect supply
increase in technology in production
increase in the costs of production
change in production location
government regulations
30
One person is the only pharmacist for over 800 miles. This is an example of what type of monopoly
technological monopoly
monopoly the board game
Geographic monopoly
government monopoly
31
The demand curve is always
constant
a straight line left to right
sloping up and to the right
sloping down and to the right

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