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ECO-FE Final Review: Part 1 Flashcards | StudBud
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ECO-FE Final Review: Part 1
ECO-FE Final Review: Part 1
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Questions
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Answers
1
The concept of scarcity is important to economics because...
All societies face scarcity and choice, regardless of wealth of poverty
Its not important, we just spent all semester studying it for nothing.
It is a valuable thought experiment into what could be
It helps consumers to weigh relative price
2
The law of supply is true because...
As costs rise, a company's profits rise
As product price rises, a company's profit rises
As income rises, demand rises
As the price increases, supply will naturally decrease
3
If a collection of businesses in the same industry joined forces to control the market, this would an example of...
A Trust
Perfect Competition
Monopolistic Competition
A Justice League
4
How might a government affect the PPC in a free market?
By making all private businesses state-owned
By cutting the costs of production
by increasing personal income taxes
By replacing business leaders with politicians
5
Give an example of Economic Freedom.
Free contract
A and B only
Legal Equality
Voluntary Exchange
6
Bozo and Trumbus own a partnership together selling bits of paper they find on the floor. One problem they could have is
Bozo and Trumbus are liable for all debts (and it has A LOT of debt)
They will lose control of their company to the stockholders
Bozo will have to foot the entire bill himself
The company will survive long after Bozo and Trumbus are gone
7
Scarcity is...
Unlimited WANTS, limited RESOURCES
When demand is greater than supply
Limited WANTS, unlimited RESOURCES
When supply is greater than demand
8
If the PPC were to move to point A, this would demonstrate...
Economic growth
Economic Contraction
Economic Expansion
More production of "butter"
9
Suppose this is the market for doo-dads. If the goverment set a price of P3 for doo-dads, it would create a....
Price ceiling
Price floor
Price window
Price wall
10
The following producers supply most of the cereal in the US. This is an example of....
Monopolistic Competition
Monopoly
Oligopoly
Perfect Competition
11
Little Jenny owns a lemonade stand. Recently, the cost of lemons and sugar has increased. Which is likely true?
Jenny will sit an pout because she is a small child and thats what they do.
Jenny will make no lemonade
Jenny will make less lemonade
Jenny will make more lemonade
12
Trusts are totally fair and the government loves them.
True
False
13
A public good....
Is a service provided by a private corporation
Is a good that is only available to those that pay
Is an aspirational idea that has not yet been fully realized
Is a good available to anyone, regardless of whether they pay
14
What is one thing that investment into public goods provides?
Jobs
Investment protection
Fewer taxes
Lower quality of life
15
If Frank sees the price of his clothing rise....
He will be less likely to buy sporting good
He will sell everything he owns and become a squid
He will be likely to increase his purchase of sporting goods
he will not change his psending habits
16
If the produciton possibilities curve were to move to point x, this would demonstrate...
Additional Production of "guns"
Economic contraction
Economic growth
Economic stagnation
17
The Three Basic Economic Questions are:
Why, Why, Why?!?!?!
What, How, Why
What, Who, Where
What, How, Who?
18
Which of the following was our example of Monopolistic Competition?
Hershey Bar
Mint Life-Savers
Jolly Ranchers
Starburst/ Airheads
19
Which of the following is an example of capital?
Trees
A chainsaw
A logging company
A lumberjack
20
Which of the following was our example of Monopoly?
Starburst/Airheads
Hershey Bar
Jolly Ranchers
Mint Life Savers
21
Why did the US pass the Sherman Anti-trust Act?
Because people told the truth too much
Because there was too much competition within certain industries
Because nobody liked Sherman and couldn't trust him
To break up trusts and increase competition in the US
22
Which of the following was our example of pure competition?
Hershey Bar
Jolly Ranchers
Mint Life Savers
Star Burst/Airheads
