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Microeconomics Review
Microeconomics Review
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Microeconomics Unit Review
Flashcards
30 cards
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Practice quiz
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Questions
30
Answers
1
If price goes up, and the total revenue increases, then the good is
Inelastic
Elastic
Unit Elastic
2
Total revenue is calculated by
Adding quantity and price
Multiplying quantity by price
Counting profit
Dividing quantity by price
3
How are prices determined in competitive markets?
By the government
By forces of supply and demand
By the largest corporation
By the consumer
4
A shortage occurs when _______ outpaces ________.
Demand, supply
Supply, demand
5
The Law of Supply states that quantity supplied varies ______ with price.
Inversely
Directly
6
The philosophy of laissez faire originated with?
Alan Greenspan
John Maynard Keynes
Adam Smith
Warren Buffett
7
New companies that focus on creating and introducing a new product.
Inventors
Start-ups
Entrepreneurs
Innovators
8
Utility and usefulness are synonymous terms.
True
False
9
Dr. Pepper and Mr. Pibb
Compliments
Substitutes
Unrelated goods
10
A change in what would cause a change in quantity demanded?
Change in advertising
Change in season
Change in consumer tastes
Change in price
11
Which of the following is a problem with being the first to innovate?
Copying and imitation
Patents
Fast-second
12
Pure competition is a theoretical situation.
True
False
13
A new tax has the same effect on supply as
An increase in the cost of inputs
Reduction of the number of sellers
Introduction of new technology
An increase in subsidies
14
The cost that a business incurs even if output is zero
Fixed cost
Variable cost
Marginal cost
15
Demand includes which of the following
Ability to buy a product
Willingness to buy a product
All three
Desire to buy a product
16
PlayStation and Madden '19
Substitutes
Compliments
Unrelated goods
17
An item which is specially priced below cost to attract customers.
Ration
Loss leader
Break-even product
Equilibrium
18
If the elasticity of demand > 1, the product is
Unit Elastic
Elastic
Inelastic
19
The demand curve is the graphical representation of
The demand schedule
The demand listing
The demand numbers
The demand table
20
For resources to be allocated efficiently, information about market conditions is necessary.
True
False
21
A demand schedule shows
What people will destroy at all prices
What people will sell at all prices
What people will buy at all prices
What people will make at all prices
22
Watches and coffee
Compliments
Substitutes
Unrelated goods
23
The higher the price, the more a seller is willing to bring to market.
True
False
24
What would cause a supply curve to shift to the left?
Future prices are expected to drop
The cost of inputs is lowered
A new tax is passed
A new technology is found
25
How might advertising affect demand?
People willing to buy more at each and every price
People willing to buy less at each and every price
Advertising doesn't affect consumers
26
Elasticity of demand is calculated by dividing % change in _______ by % change in ________.
Price, quantity demanded
Quantity demanded, price
27
Profit is maximized when marginal cost is _____ marginal revenue.
Equal to
Greater than
Less than
28
During discount sales, which is likely to be true?
Suppliers are willing to bring more to market
Sales don't affect consumer behavior
Supplies are limited
Consumers are willing to buy less
29
The Law of Demand states that quantity demanded varies _______ with price.
Directly
Inversely
30
Which of the following is an example of a variable cost?
All of the above
Electricity
Raw materials
Labor
