Economics Unit 3 Review

Question 1

The government increases taxes on widgets. What happens to the supply curve for widgets?

Accepted Answer

Shifts to the left

Question 2

Which TWO countries are part of NAFTA (USMCA)?

Accepted Answer

Mexico and Canada

Question 3

Which statement BEST describes the influence of high prices on the behavior of producers?

Accepted Answer

High prices are an incentive for producers to produce more

Question 4

A country has a comparitive advantage over another country when

Accepted Answer

It can produce a good at a lower opportunity cost than another country

Question 5

Demand does not change, supply decreases, what happens to the equilibrium quantity?

Accepted Answer

Decreases and price rises

Question 6

All of the following non price determinants cause a change in supply EXCEPT:

Accepted Answer

Market size

Question 7

Movement along a demand curve, as opposed to a shift of the entire curve, is the result of

Accepted Answer

Change in price

Question 8

Where quantity demanded and quantity supplied are equal determines the price of an item.

Accepted Answer

True

Question 9

Which of the following describes the relationship between income and demand?

Accepted Answer

An increase in income increases demand

Question 10

On a supply and demand graph, supply will decrease and shift to the left when the following happens

Accepted Answer

The number of firms leaving the industry increases

Question 11

Country A can produce more oil at a lower opportunity cost than Country B. Country A has a (an) _____________.

Accepted Answer

A comparative Advantage

Question 12

Which of the following statements is true about the demand schedule for gasoline?

Accepted Answer

As the price of gasoline decreases, the quantity demanded increases

Question 13

What best describes a demand schedule?

Accepted Answer

Data

Question 14

A distinctive characteristic of pure competition is

Accepted Answer

There are no examples of this market structure

Question 15

With a certain amount of resources, a country with a comparitive advantage will produce a product with

Accepted Answer

Lower opportunity costs

Question 16

Complete barriers to market entry, no product differentiation and one seller are characteristics of

Accepted Answer

Monopoly

Question 17

It benefits two countries to trade only when there is/are

Accepted Answer

A comparitive advantage in production between the 2 countries

Question 18

Economists forecast the price of cars will increase 20% next year. What happens to the market for cars?

Accepted Answer

Demand curve shifts right

Question 19

Beef and chicken are substitutes for consumers. There is a drought in the cattle grazing areas. The drought will cause

Accepted Answer

The demand curve for chicken to shift right

Question 20

Few sellers, some control over price, high entry barriers and some product differentiation describe

Accepted Answer

Oligopoly

Question 21

On a supply & demand graph, price is always on____________ and quantity is always on___________.

Accepted Answer

vertical axis, horizontal axis

Question 22

As price increases, what happens to the quantity demanded?

Accepted Answer

It decreases

Question 23

Which of the following industries in the U.S. is NOT an example of monopolistic competition?

Accepted Answer

Airline Industry

Question 24

Equilibrium in the market is reached when

Accepted Answer

Quantity supplied equals quantity demanded

Question 25

Which statement best describes the influence of high prices on behavior of producers?

Accepted Answer

High prices are incentive for producers to produce more

Question 26

The statement that best describes trade between nations

Accepted Answer

It is mutually beneficial

Question 27

When number of sellers leave the market and inputs double in price, what will happen on a supply & demand graph?

Accepted Answer

Supply decreases and shifts to the left

Question 28

Which of following would cause the demand curve to shift to the right?

Accepted Answer

A new, popular video game just came on the market

Question 29

An example of an Oligopoly in the United States

Accepted Answer

Automobile Industry

Economics Unit 3 Review

Questions 29

Economics Unit 3 Review

Questions 29