Economic profit _____

will tend toward zero because firms enter markets where profit is made

Taxing profit generally will _____

impede the process by which producers respond to consumer demand

a trade barrier that the government imposes on imports as import limits

Taxing profit generally will ___

impede the process by which producers respond to changes in consumer demand

Choose one thing that one must do to earn and continue to earn a profit in a market economy.

provide a product or service that consumers want

Which of the following will NOT SHIFT the supply curve for peanut butter?

an increase in the price of peanut butter

Define comparative advantage

the ability to carry out one activity more efficiently than another

Name another thing that laborers need for free trade to lead to better outcomes for them.

a strong and ethical judicial system

goods that decrease in demand as consumer income rises

If the federal government sets minimum wage at $15 when the equilibrium wage for low-skilled workers is $10, then _____

there will be a reduction in the number of low-skilled workers employed

If the federal government sets a minimum wage of $15, when the equilibrium price for low-skilled workers is $11, then __

the number of jobs available for low-skilled workers will decrease

A market-based economy assumes that ___

individuals attempt to make themselves better when they act

a sum of money granted by the government to assist a business or indivicual

the economic concept the we must allocate limited resources

a tax on imports, often known as a duty or a trade barrier

Define substitute good

two products that could be used for the same purpose

Define complementary good

goods that share a beneficial relationship

a social science of how people trade goods and services

Which of the following will NOT SHIFT the demand curve for applesauce?

an increase in the price of applesauce

a raw material or primary agricultural product that can be bought or sold

If the government raises taxes on oil companies, we should expect ___

less innovation in the production of oil and therefore higher oil prices

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Econ Semester 1 Review

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Questions 55

Answers

1
Economic profit _____
is often due to a firm becoming so large that it can exploit its consumers
will tend toward zero because firms enter markets where profit is made
should be taxed if an economy is to remain dynamic
is usually larger than accounting profit
2
We're about to practice supply/demand curves. Get out a piece of paper if you want it. Hit yes when you are ready
yes
no
3
Which of the following is true of the equilibrium price of a good or service?
The equilibrium price will change when the consumer preferences change.
All three
There is no incentive for the price to change at the equilibrium price.
The equilibrium price occurs when the demand and supply curves intersect.
4
Taxing profit generally will _____
reduce exploitative power of larger corporations
ensure a competitive market
allow an increase in the standard of living of the poor
impede the process by which producers respond to consumer demand
5
Define quota
goods that share a benficial relationship
a trade barrier that the government imposes on imports as import limits
a tax on imports, often known as a duty or a trade barrier
revenue received from the sale of a good minus the opportunity cost
6
Name one thing that producers need to be successful in a free market system
subsidies
minimum wage limits
trade barriers
property right
7
If the price of a good changes, we _____ the demand curve.
shift
move along
8
The Cultural Mandate and God's call to stewardship remain, but _____ prevent us from fulfilling them without God's grace
our tendencies to exploit others
our sinful natures
natural laws
our premature deaths
9
Taxing profit generally will ___
reduce the exploitative power of large corporations
all three
impede the process by which producers respond to changes in consumer demand
allow an increase in the standard of living of the poor
10
A local hair salon notifies its customers that it is raising prices, the demand for hair services at THAT salon will
decrease
stay the same
increase
11
The market system is ___ in that there is no one in charge of the system
unjust
All three
random
spontaneous
12
Choose one thing that one must do to earn and continue to earn a profit in a market economy.
engage in corprate espionage
provide a product or service that consumers want
cheat
avoid paying taxes
13
Will the equilibrium price for hair services increase, decrease, or stay the same?
decrease
increase
stay the same
14
If there are too many bagels in a market, then we should see
the price of bagels rise
bagels disappear from the market altogether
the price of bagels stay the same
the price of bagels fall
15
Vanilla is widely used in the production of cakes. If vanilla bean crops are destroyed, the supply of vanilla cakes will
increase
decrease
stay the same
16
A steward is one who, under the authority of the owner, manages his property for
the welfare of others
the best use of his family
the owner's benefit
personal gain
17
If the story for a good changes, we ____ the demand curve.
shift
move along
18
Producers are more likely to respond to changes in consumer demand in a centrally-planned system than a market economy.
True
False
19
Which of the following will NOT SHIFT the supply curve for peanut butter?
a discovery of new technology for making peanut butter
an increase in wages
an increase in the price of peanut butter
a decrease in the price of peanuts
20
Define comparative advantage
Goods that share a beneficial relationship
the ability to carry out one activity more efficiently than another
a trade barrier that the government imposes on imports as import limits
goods that decrease in demand when consumer income rises
21
Will the equilibrium price for vanilla cakes increase, decrease, or stay the same?
decrease
stay the same
increase
22
In a market system,
the price system ensures that there are seldom shortages of goods
people act according to their own plan
you have to produce what other people want to be successful
All three
23
Name another thing that laborers need for free trade to lead to better outcomes for them.
a strong and ethical judicial system
a vibrant welfare system
minimum wage limits
quotas
24
Name one thing that laborers need for free trade to lead to better outcomes for them.
minimum wage limits
subsidies
a free and active press
quotas
25
Which of the following is true of demand curves?
A demand curve is also the marginal benefit curve of the individual.
A market demand curve is the horizontal sum of the individual demand curves
All three
Demand curves slope down both for individuals and the market.
26
Monopolies _____
that earn economic profet attract competition
are the result of barriers to entry such as regulation and taxation
all of the above
cannot force you to purchase their product
27
Will the demand curve for wedding cakes shift to the right, to the left, or stay the same?
stay the same
shift to the left
shift to the right
28
Will the equilibrium price for wedding cakes increase, decrease, or stay the same?
decrease
increase
stay the same
29
Define inferior good
goods that decrease in demand as consumer income rises
revenue received from the sale of goods minus the opportunity cost
goods that share a beneficial relationship
a trade barrier that the government imposes on imports as import limits
30
Because economics deals with _____, it is always going to be related to ethical issues.
fiscal management
monetary function
resourc allocation
human action
31
If the federal government sets minimum wage at $15 when the equilibrium wage for low-skilled workers is $10, then _____
there will be a reduction in the number of low-skilled workers employed
all of the above
there will be increased unemployment of high-skilled workers
the price of menu items in fast-food restaurants will decrease
32
If the federal government sets a minimum wage of $15, when the equilibrium price for low-skilled workers is $11, then __
the price of menu items in fast-food restaurants will decrease
There will be increased unemployment among high-skilled workers
all three
the number of jobs available for low-skilled workers will decrease
33
A market-based economy assumes that ___
the added benefit of an extra unit of a good increase as we get more of it
all three
individuals attempt to make themselves better when they act
individuals act selfishly
34
Define subsidy
a sum of money granted by the government to assist a business or indivicual
a tax on imports, often known as a duty or a trade barrier
a trade barrier that the government imposes on imports as an import limit
a social science of how people trade goods and services
35
The first and most basic economic principle is
Man is to be God's steward
Man owns private property
God owns everything
Economics is primarily a scientific discipline
36
Define scarcity
a sum of money granted by the government to assist a business or individual
a social science of how people trade goods
the ability to carry out one activity more efficiently than another
the economic concept the we must allocate limited resources
37
The 10 Commandments provide the _____ necessary for people to create community in which they can be stewards under God.
cultural and legal framework
economic laws
elementary rules
personal ethical standards
38
Define tariff
a tax on imports, often known as a duty or a trade barrier
a trade barrier that the government imposes on imports as an import limit
a raw material or primary agricultural product that can be bought and sold
the economic concept that we must allocate limited resources
39
Define substitute good
two products that could be used for the same purpose
revenue received from the sale of a good minus the opportunity cost
goods that share a beneficial relationship
the ability to carry out one activity more efficiently than another
40
Choose one thing that one must do to earn and continue to earn a profit in a market economy.
innovate
cheat
avoid paying taxes
pay low wages
41
A popular magazine spotlights cookie tables as the newest wedding trend, the demand for wedding cakes will ___
increase
stay the same
decrease
42
Which of the following individuals/groups decide what is produced in a market system?
consumers
producers
All three
central planners
43
Define complementary good
the cost of an opportunity forgone
two products that could be used for the same purpose
the economic concept that we must allocate limited resources
goods that share a beneficial relationship
44
Will the demand curve for hair services shift to the right, to the left, or stay the same?
stay the same
shift to the right
shift to the left
45
Define economics
goods that share a beneficial relationship
goods that decrease in demand when consumer income rises
a social science of how people trade goods and services
a trade barrier that the government imposes on imports as an import limit
46
Markets require a large amount of ___ among individuals and businesses.
competition
cooperation
all three
injustice
47
If economic profit is being made in the e-reader industry, we should expect that over time _____
e-reader supply will decrease
e-reader prices will increase
the e-reader industry will become controlled by a single firm
e-reader prices will fall
48
Which of the following will NOT SHIFT the demand curve for applesauce?
an increase in the price of applesauce
an increase in the price of canned peaches
an increase in consumer income
a decrease in the price of canned peaches
49
Name another thing that producers need to be successful in a free market system
trade barriers
reliable infrastructure
regulation
subsidies
50
Define Commodity
a social science of how people trade goods and services
a sum of money granted by the government to assist a business or individual
a tax on imports, often known as a duty or a trade barrier
a raw material or primary agricultural product that can be bought or sold
51
If the government raises taxes on oil companies, we should expect ___
all three
oil companies to increase production in and attempt to increase revenue
less innovation in the production of oil and therefore higher oil prices
the price of oil to remain unchanged
52
Will the supply curve for vanilla cakes shift to the right, to the left, or stay the same?
shift to the left
stay the same
shift to the right
53
Define economic profit
a sum of money granted by the government to assist a business or individual
a raw material or primary agricultural product that can be bought and sold
revenue received from the sale of goods minus the opportunity cost
a tax on imports, often known as a duty or a trade barrier
54
A market economy solves the information problem ___
all three
through the price system
through a restricted role of government
by increasing the use of technology in communications
55
Define opportunity cost
the ability to carry out one activity more efficiently than another
revenue received from the sale of goods minus the opportunity cost
the economic concepts that we must allocate limited resources
the cost of an opportunity forgone

Econ Semester 1 Review Flashcards | StudBud