Monopoly has two key features, which are:

barriers to entry and no close substitutes.

In the PPF shown in the figure below, which of the following combinations of hats and bananas is inefficient?

1 million pounds of bananas and 3 million hats

Which of the following is a microeconomic topic?

how increasing rent impacts the supply of apartments

Total revenue of a firm equals

price multiplied by quantity sold.

Severe weather has damaged this year's lettuce crop. The initial effect on the lettuce market is a(n):

decrease in the supply for lettuce.

Economics is best defined as the study of how people, businesses, governments, and societies ...

make choices to deal with scarcity.

If the price for a chair is $60, describe the situation in the market and explain how the price adjusts.

Surplus and the price will fall

Given the chart below, at which output levels losses occur?

below 30,000 and above 80,000 bushels

Factors of production include

Land, labor, capital and entrepreneurship

The production possibilities frontier separates the goods and services:

that can be produced from those that can't.

If the price for a chair is $20, describe the situation in the chair market and explain how the price adjusts.

Shortage and the price will rise

our inability to satisfy all our wants.

The “Law of Demand” is illustrated by a:

movement along the demand curve.

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ECON2010 Final Exam Review 1

24 termsStudBud Administration9 plays

Sections 1 - 6.

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Questions 24

Answers

1
Monopoly has two key features, which are:
close substitutes and no barriers to entry.
franchises and barriers to entry.
barriers to entry and close substitutes.
barriers to entry and no close substitutes.
2
If McDonald's decides to produce more burgers and less salads, which of the big economic questions are they answering?
"scarcity"
"why"
"when"
"what"
3
Scarcity requires that people must ...
cooperate.
make choices.
compete.
trade.
4
In the PPF shown in the figure below, which of the following combinations of hats and bananas is inefficient?
4 million pounds of bananas and 4 million hats
2 million pounds of bananas and 5 million hats
1 million pounds of bananas and 3 million hats
0 pounds of bananas and 6 million hats
5
Which of the following is a microeconomic topic?
how a tax rate increase will impact total production
how a trade agreement between the U.S. and Mexico affects unemployment
how increasing rent impacts the supply of apartments
comparing inflation rates across countries
6
If firms in a perfectly competitive market, as new firms enter, the price _______ and profit of existing firm
falls; increases
falls; decreases
rises; decreases
rises; increases
7
Total revenue of a firm equals
marginal revenue multiplied by quantity sold.
price multiplied by quantity sold.
total cost minus profit.
the area between the demand curve and the marginal revenue curve.
8
Severe weather has damaged this year's lettuce crop. The initial effect on the lettuce market is a(n):
decrease in the demand for lettuce.
decrease in both the demand and supply for lettuce.
decrease in the supply for lettuce.
upward movement along the demand curve for lettuce.
9
Which of the following is NOT a characteristic of a monopoly?
barriers to entry
easy entry and exit
a single firm
no close substitutes for the product produced
10
In the figure what is the profit maximizing price for the quantity under Perfect Competition?
$20; 3000 per week
$10; 2000 per week
$10; 3000 per week
$30; 2000 per week
11
In the figure what is the profit maximizing pricefor the quantity under a Monopoly?
$30; 2000 per week
$10; 3000 per week
$10; 2000 per week
$20; 3000 per week
12
Economics is best defined as the study of how people, businesses, governments, and societies ...
attain wealth.
choose abundance over scarcity.
make choices to deal with scarcity.
use their infinite resources.
13
Thefigure below shows the demand and supply for the chair market.What is the equilibrium quantity for the chair market?
EQ = 100
EQ = 300
EQ = 200
EQ = 150
14
If the price for a chair is $60, describe the situation in the market and explain how the price adjusts.
Shortage and the price will fall
Shortage and the price will rise
Surplus and the price will rise
Surplus and the price will fall
15
Given the chart below, at which output levels losses occur?
at 30,000 bushels and at 80,000 bushels
below 30,000 and above 80,000 bushels
from 30,000 to 80,000 bushels
below 80,000 bushels
16
Factors of production include
only capital, land and labor
Land, labor, capital and entrepreneurship
The economic system
Land, entrepreneurship and capital (not the land which is fixed)
17
The production possibilities frontier separates the goods and services:
types that can be attained from those that can't
that people want from those they don't.
that people value and those they don't.
that can be produced from those that can't.
18
In the long run
some inputs are variable and other inputs are fixed.
output is fixed.
all inputs can be varied.
all inputs are fixed.
19
If the price for a chair is $20, describe the situation in the chair market and explain how the price adjusts.
Surplus and the price will rise
Surplus and the price will fall
Shortage and the price will rise
Shortage and the price will fall
20
Scarcity is ...
our inability to satisfy all our wants.
an economic problem only for poor people.
eliminated by choices.
exists during economic recessions but not during economic booms.
21
The “Law of Demand” is illustrated by a:
rightward shift of the demand curve.
leftward shift of the demand curve.
both a) and b) are correct.
movement along the demand curve.
22
The figure below shows the demand and supply for the chair market. What is the equilibrium price for the chair market?
EP = $30
EP = $20
EP = $60
EP = $40
23
Which of the following is NOT held constant while moving along a supply curve?
prices of factors of production.
expected future prices.
the number of sellers.
the price of the good itself.
24
In the figure, which movement reflects an increase in the price of a complement for fruit snacks?
from point a to d
from point a to point e
from point a to point b
from point a to c

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