stud
bud
Sign up
Log in
Home
Library
Explore
SAT
More
Unit 2 Review Flashcards | StudBud
Explore
/
Unit 2 Review
Unit 2 Review
58 terms
·
StudBud Administration
·
87 plays
Imported from external platform
Flashcards
58 cards
F
Practice quiz
P
Host live
L
Questions
58
Answers
1
Which event in
Florida
and
California
would most likely shift the
supply curve
for
orange juice
to the
left
?
rise of mango juice as a popular breakfast drink
evidence that citrus fruit strengthens bones
an early frost accompanied by ice storms
an influx of new low-wage workers
2
New Deal programs
offered employment
during the
Great Depression
. These programs were designed to respond to
a shortage of skills.
a lack of incentives.
an excess of services.
a surplus of workers.
3
What does the
market supply curve
show?
the effect of subsidies
supply shifters
the law of diminishing marginal utility
the law of supply
4
A juice bar produces a
smoothie
that is
wildly popular
, and they
cannot keep up with demand
. What should they do?
raise the price of the smoothies
buy the additional supplies needed to make more smoothies
all the above
hire more staff to make smoothies more quickly
5
Supply
depends on the
willingness and ability of
advertisers to promote.
donors to contribute.
consumers to purchase.
producers to produce.
6
Which market structure do we encounter most often in our daily lives?
oligopoly
perfect competition
monopoly
monopolistic competition
7
What can cause a
change in demand
?
changes in the price of substitute goods
changes in income
changes in consumer tastes
all the above
8
CD and MP3 players caused a
decrease in demand for cassette players
. What
complementary good
also decreased?
MP3 players
record albums
cassette tapes
CDs
9
A
market failure
occurs when
the economy experiences a downturn and unemployment is extremely high.
goods and services are not allocated in the most efficient way.
a particular industry fails to make an adequate profit in a given year.
a single company supplies most of a good or service in an area.
10
What does it mean if an economist says
demand for a product is
inelastic
?
Demand responds slightly or not at all to a change in price.
Demand always decreases in response to a price decrease.
Demand changes in response to a change in price.
Demand always increases in response to a price increase.
11
Which of these situations best illustrates
market equilibrium
?
Soap production ensures a good profit for the manufacturer.
The amount of soap made matches the amount of soap that people want to buy.
Everyone who wants or needs soap can easily afford to buy it.
The price of soap does not vary much from week to week.
12
Which of the following is an example of a
supply shifter
?
changing consumer tastes
rising unemployment
an increase in the cost of inputs
a spike in the population
13
Public goods
include
banking and other financial services.
child-care services.
fire and police services.
computer repair services.
14
If the price of milk rises by
50%
and customers buy
9%
fewer gallons, what is the
elasticity
?
0.18, elastic
5.55, elastic
5.55, inelastic
0.18, inelastic
15
In a market with
perfect competition
, how are prices determined?
by cultural ideals of fairness
by supply and demand
by government regulation
by agreement among producers
16
Why doesn’t the
market system
work to provide
street lighting
and other
public goods
?
Too few of these services are available.
There is no easy way to charge individual users.
Important needs cannot be left to chance.
Voters put pressure on local governments.
17
What happens to the
market demand curve
when there is an
increase
in
market demand
?
It shifts to the left.
It shifts upward.
It shifts downward.
It shifts to the right.
18
In which market structure do
producers have the most market power
?
monopoly
perfect competition
monopolistic competition
oligopoly
19
What does it mean if an economist says
demand for a product is
elastic
?
Demand responds slightly or not at all to a change in price.
Demand always decreases in response to a price decrease.
Demand changes in response to a change in price.
Demand always increases in response to a price increase.
20
Which of these might best
signal
furniture makers to
cut back production
?
a drop in the price consumers are willing to pay
an increase in availability of skilled workers
an introduction of competitors into the market
a fall in the cost of essential raw materials
21
An example of when the government might
impose rationing
is
when farmers have produced more grains than people demand.
when it hopes to stimulate the economy by urging people to spend money.
when essential, but high-demand, goods are in short supply.
when it establishes a minimum wage for labor.
22
What is
market supply
?
the direct relationship between price and quantity
the relationship between the price and the quantity of supply for an item
the sum of all the individual quantities demanded in a market
the sum of all the individual quantities supplied in a market
23
Barriers to entry are
markets in which producers have some control over the prices.
the costs of shopping around for the best product at the best price.
obstacles that can restrict access to a market and limit competition.
producers who must accept the market price for their product.
24
How is the
market-clearing
(market-balancing)
price
determined?
It is reached through trial and error.
It is fixed by each manufacturer.
It is set by a government commission.
It is calculated by economic analysts.
25
What does
Point A
represent on this
market supply curve
?
If producers sell 750 tacos, they will make a profit of $1.50 on each taco.
The cost to produce 750 tacos is $1.50.
Producers will sell 750 tacos at a time for a total price of $1.50.
For $1.50, producers are willing and able to supply 750 tacos every week.
26
At the
farmers market
, what happens when
watermelons
reach their
equilibrium price
?
Most farmers will take home extra unsold watermelons.
Customers will buy all of the melons that farmers are selling.
Farmers will be unable to sell any watermelons at all.
Many customers who want watermelons will go home empty-handed.
27
What is
market demand
?
the sum of the individual quantities demanded in a market
the sum of the individual quantities supplied in a market
the amount of a good/service that consumers is willing to buy at all prices
the amount of a good/service that a seller has available at all prices
28
What would likely happen to the
demand for swim wear
in a clothing store when
blizzards keep customers at home
?
The demand curve becomes steeper.
The demand curve shifts to the left.
The demand curve shifts to the right.
The demand curve becomes flatter.
29
Which of the following questions would be
most helpful
in determining
the market structure of a specific market
?
How many people want to buy?
How similar are the products?
How far are goods shipped?
How are the corporations organized?
30
A
price floor
is
the exact amount it costs to produce a good, without making a profit.
the price at which the demand matches the supply of that good or service.
a legal minimum price consumers are required to pay for a good or a service
an illegal market with much higher prices due to shortages
31
Nonprice competition
typically focuses on
four
factors:
physical characteristics
,
service
,
status and image
, and
collusion.
location.
barriers to entry.
price.
32
What happens to the
market supply curve
when there is
a decrease in market supply
?
It shifts downward.
It shifts upward.
It shifts to the left.
It shifts to the right.
33
An
oligopoly
is a market or an industry
where a large number of producers provide goods that are similar but varied
in which a large number of firms produce essentially the same product.
dominated by just a few firms that produce similar or identical products.
where a single producer of a product has no close substitutes.
34
Markets
are governed by
excess demand.
the law of supply and demand.
disequilibrium.
price controls.
35
Why is
competition among restaurants
in a
big city
an example of
monopolistic competition
?
All restaurants serve food, and each restaurant is distinctive.
Restaurants often go out of business.
All restaurants serve people, and one restaurant serves the most people.
Starting a restaurant is expensive.
36
Public goods
are
excludable and rival in consumption.
excludable and nonrival in consumption.
nonexcludable and nonrival in consumption.
nonexcludable and rival in consumption.
37
The degree to which the
quantity demanded responds to changes in price
is called
schedule.
revenue.
elasticity.
utility.
38
As it
becomes easier to start a new business
in a market, that market
attracts more consumers.
offers higher-quality products.
increases transaction costs.
becomes more competitive.
39
Which of the following is an example of a
natural monopoly
?
the only sandstone quarry in Menomonie, Wisconsin
author J.K. Rowling's copyright for her Harry Potter novels
the water system that serves the greater Boston metropolitan area
millionaire John D. Rockefeller's Standard Oil Company
40
What can cause a
change in supply
?
changes in the number of producers
changes in government policy
changes in technology
all of the above
41
The
law of demand
states that as
price decreases
demand increases.
quality decreases.
production increases.
wages decrease.
42
A market structure usually contains
four
main traits:
number of producers
,
similarity of products
,
ease of entry
, and
control over prices.
brand loyalty.
monopolistic competition.
perfect competition.
43
Why is it often difficult for the government to end price controls?
Politicians are reluctant to repeal price control when voters support them.
all the above
Many people believe that price controls further the goal of economic equity
The government usually intervenes when prices rise and fall too rapidly.
44
What leads to
excess demand
?
Sellers decrease the prices of their goods or services.
More people want a good or service than producers can supply.
The supply of a good or service is equal to the amount consumers want.
Prices increase more than consumers are willing to pay.
45
Which of these is the best example of an
externality
?
Your new bicycle goes faster than you expected.
Your shoe store stops selling your favorite style.
You enjoy looking at your neighbor's garden.
You decide to stop snacking between meals.
46
If a manufacturer introduces a new product with a
successful ad campaign
and a
low introductory price
, what happens?
surplus
shortage
equilibrium
rationing
47
In the summer picnic season,
a sharp rise in the price of burgers
may lead to an
increase in demand
for
ketchup.
buns.
relish.
hot dogs.
48
If medical research identified
blueberries as a powerful "brain food,"
what would happen
next
?
The demand curve for blueberries would shift to the left.
The demand curve for blueberries would shift upward.
The demand curve for blueberries would shift downward.
The demand curve for blueberries would shift to the right.
49
According to the
law of supply
, what happens as
price increases
?
The quantity supplied increases.
The demand decreases.
The supply curve becomes flat.
The supply curve shifts to the left.
50
The most important
argument
many economists make
against price controls
is that they are
inefficient.
unstable.
insecure.
unfair.
51
Which of these would most likely
increase the supply of sports equipment
?
a transportation strike
an increase in the supply of personal trainers
a government excise tax
a decrease in the price of raw materials
52
Which of these is most likely to
quickly
become available in larger quantities as a result of a price increase
midsize cars
medical doctors
babysitters
airline service
53
What would happen if a farmer sells
her entire supply of watermelons
in the
first hour
the farmers market is open?
She will sell melons at a lower price at the next farmers market.
She will stop selling melons and sell other produce instead.
She will raise her prices at the next farmers market.
She will bring fewer melons to sell at the next farmers market.
54
The purpose of
rationing
during
World War II
was to ensure that
manufacturers could make a profit.
products would go to those who valued them most.
everyone could get essential scarce goods.
workers would have an incentive to get jobs.
55
What is the usual result of setting a
price ceiling
on
rents
?
People can find apartments but cannot afford to rent them.
More people want to rent apartments than are available to rent.
Houses are broken up into apartments to meet the demand.
Construction jobs increase with the building of new apartment buildings.
56
A
graduate
from
college
starts a
profitable new business
. She
creates jobs
for three workers. Those
jobs
are
a sign of market efficiency.
a positive externality of her education.
a form of nonprice competition.
a negative externality.
57
Why do
goods made in factories
that cause
pollution
tend to be
overproduced
?
Some costs are not charged to the producer.
Some stores stock more than they can sell.
Some benefits are wanted by the community.
Some people may refuse to purchase the items.
58
The
equilibrium price
is the price at which
consumers start reducing demand.
producers' total revenue is highest.
neither demand nor supply will shift.
demand and supply curves intersect.
