When the market price is below the equilibrium price.

More will be wanted than will be supplied, A shortage will develop

How is the current demand for a good related to its future price?

If the price is expected to drop, current demand will fall.

Which of the following is NOT a key economic question?

How should goods and services are paid for?

A shift in the demand curve means which of the following?

a change in demand at every price

When the selling price of a good goes up, what is the relationship to the quantity supplied?

It becomes practical to produce more goods.

Which of the following lists would an economist consider to be land?

iron ore, natural gas, fertile soil, water

All of the following are types of decisions that can be made at the margin EXCEPT

whether or not to go on a vacation.

Why does even a free market economy need some government intervention?

to provide for things that the marketplace does not address

What is the opportunity cost of a decision?

the most desirable alternative given up for the decision

What do sellers do if they expect the price of their goods to increase in the near future?

store the goods until the price rises

An efficient economy is one that

uses its resources to make the most goods and services.

The purpose of a production possibilities graph is to

show alternative ways to use an economy’s resources.

What happens to a market in equilibrium when there is an increase in supply?

Q supplied will exceed Q demanded, so the price will drop.

Which of the following is NOT characteristic of a centrally planned economy?

Each collective or factory sets its own goals.

What happens to the money that is withheld from your pay for Social Security?

It is redistributed as cash transfers to elderly.

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Econ Exam Review

25 termsStudBud Administration981 plays

Econ Exam Review

Flashcards25 cardsFPractice quizPHost liveL

Questions 25

Answers

1
The physical capital used by a woodworker to make furniture would include
saws and drills.
wood and glue.
a workshop and money.
hard work and time.
2
When the market price is below the equilibrium price.
Equilibrium will occur
A surplus will develop
More will be wanted than will be supplied
A shortage will develop
3
The govt of a country makes decision btwn increasing military spending and subsidizing farmers
guns or butter issue.
decision at the margin.
basic economic decision.
global trade-off.
4
What is one of the most important advantages of a free market?
It can change rapidly.
It is easy to regulate.
It encourages growth.
It protects the less fortunate.
5
What does the process of specialization do for an economy?
It fosters competition.
It makes it more efficient.
It makes it easier to control.
It eliminates unemployment.
6
How is the current demand for a good related to its future price?
If the price is expected to rise, current demand will fall.
Current demand is not related to future price.
If the price is expected to drop, current demand will fall.
If the price is expected to drop, current demand will rise.
7
What happens when wages are set above the equilibrium level by law?
Firms employ fewer workers
Firms employ more workers than at equilibrium wage
Firms tend to break the law and hire people at a lower wage.
Firms hire more workers
8
Which of the following is NOT a key economic question?
What goods and services should be produced?
How should goods and services are paid for?
How should these goods and services be produced?
Who consumes these goods and services?
9
A shift in the demand curve means which of the following?
a rise in prices
a decrease in both price and quantity demanded
a change in consumer income
a change in demand at every price
10
When the selling price of a good goes up, what is the relationship to the quantity supplied?
There is no relationship between the two.
It becomes practical to produce more goods.
The cost of production goes down.
The profit made on each item goes down.
11
Which of the following lists would an economist consider to be land?
dams, bridges, rock quarries, oil wells
factories, office buildings, assembly lines, workers
iron ore, natural gas, fertile soil, water
farm fields, tractors, pesticides, fertilizers
12
All of the following are types of decisions that can be made at the margin EXCEPT
whether or not to hire 100 new workers.
whether or not to go on a vacation.
what time to leave for a trip
how many acres of beans will be grown.
13
Why does even a free market economy need some government intervention?
so that the govt has some control over factor resources
to provide for things that the marketplace does not address
to make sure that the govt can fulfill its military needs
to ensure that the govt has the freedom to tax as necessary
14
What is the opportunity cost of a decision?
the best possible way the question could have been decided
a series of alternative decisions that could have been made
the most desirable alternative given up for the decision
the different ways a person might have made the decision
15
an economic side effect that generates unexpected benefits
opportunity cost
negative externality
spillover cost
positive externality
16
Demand for movie rentals is highly elastic. A store that raises the price of a rental will
see no change in revenue.
gain revenue.
lose revenue.
hire additional workers.
17
What do sellers do if they expect the price of their goods to increase in the near future?
store the goods until the price rises
sell the goods now but try to get the higher price for them
store the goods regardless of when the price rises
sell the goods now and try to invest the money
18
The law of increasing costs means that when an economy increases the production of one item
the actual cost goes up but the opportunity cost goes down.
the opportunity cost goes up.
the production costs will not change.
the actual cost of making the item goes down.
19
An efficient economy is one that
makes the best use of all its goods and services.
makes the least costly use of its resources.
has very few people who do not work for a living.
uses its resources to make the most goods and services.
20
The purpose of a production possibilities graph is to
enable a country to mobilize to win a war.
make it possible to increase an economy’s output.
keep an economy from having nonproductive workers.
show alternative ways to use an economy’s resources.
21
The term for the total value of all goods and services produced in a particular economy?
open market value
net worth
standard of living
gross domestic product
22
What is the effect of import restrictions on prices?
They often cause prices to rise steeply and then drop.
They cause prices to rise.
They usually do not have any lasting effect on price.
They cause prices to drop.
23
What happens to a market in equilibrium when there is an increase in supply?
Q supplied will exceed Q demanded, so the price will drop.
Q demanded will exceed Q supplied, so the price will drop.
Undersupply means that the good will become very expensive.
Excess supply means that producers will make fewer goods
24
Which of the following is NOT characteristic of a centrally planned economy?
The central government owns all land and capital.
Each collective or factory sets its own goals.
Each person is assigned a job.
The central government makes all economic decisions.
25
What happens to the money that is withheld from your pay for Social Security?
It is redistributed as cash transfers to injured workers
It is used to provide medical benefits to Americans over 65.
It is redistributed as cash transfers to elderly.
It is put into an account under your name to earn interest

Econ Exam Review Flashcards | StudBud

Econ Exam Review

25 termsStudBud Administration981 plays

Econ Exam Review

Flashcards25 cardsFPractice quizPHost liveL

Questions 25

Answers

1
The physical capital used by a woodworker to make furniture would include
saws and drills.
wood and glue.
a workshop and money.
hard work and time.
2
When the market price is below the equilibrium price.
Equilibrium will occur
A surplus will develop
More will be wanted than will be supplied
A shortage will develop
3
The govt of a country makes decision btwn increasing military spending and subsidizing farmers
guns or butter issue.
decision at the margin.
basic economic decision.
global trade-off.
4
What is one of the most important advantages of a free market?
It can change rapidly.
It is easy to regulate.
It encourages growth.
It protects the less fortunate.
5
What does the process of specialization do for an economy?
It fosters competition.
It makes it more efficient.
It makes it easier to control.
It eliminates unemployment.
6
How is the current demand for a good related to its future price?
If the price is expected to rise, current demand will fall.
Current demand is not related to future price.
If the price is expected to drop, current demand will fall.
If the price is expected to drop, current demand will rise.
7
What happens when wages are set above the equilibrium level by law?
Firms employ fewer workers
Firms employ more workers than at equilibrium wage
Firms tend to break the law and hire people at a lower wage.
Firms hire more workers
8
Which of the following is NOT a key economic question?
What goods and services should be produced?
How should goods and services are paid for?
How should these goods and services be produced?
Who consumes these goods and services?
9
A shift in the demand curve means which of the following?
a rise in prices
a decrease in both price and quantity demanded
a change in consumer income
a change in demand at every price
10
When the selling price of a good goes up, what is the relationship to the quantity supplied?
There is no relationship between the two.
It becomes practical to produce more goods.
The cost of production goes down.
The profit made on each item goes down.
11
Which of the following lists would an economist consider to be land?
dams, bridges, rock quarries, oil wells
factories, office buildings, assembly lines, workers
iron ore, natural gas, fertile soil, water
farm fields, tractors, pesticides, fertilizers
12
All of the following are types of decisions that can be made at the margin EXCEPT
whether or not to hire 100 new workers.
whether or not to go on a vacation.
what time to leave for a trip
how many acres of beans will be grown.
13
Why does even a free market economy need some government intervention?
so that the govt has some control over factor resources
to provide for things that the marketplace does not address
to make sure that the govt can fulfill its military needs
to ensure that the govt has the freedom to tax as necessary
14
What is the opportunity cost of a decision?
the best possible way the question could have been decided
a series of alternative decisions that could have been made
the most desirable alternative given up for the decision
the different ways a person might have made the decision
15
an economic side effect that generates unexpected benefits
opportunity cost
negative externality
spillover cost
positive externality
16
Demand for movie rentals is highly elastic. A store that raises the price of a rental will
see no change in revenue.
gain revenue.
lose revenue.
hire additional workers.
17
What do sellers do if they expect the price of their goods to increase in the near future?
store the goods until the price rises
sell the goods now but try to get the higher price for them
store the goods regardless of when the price rises
sell the goods now and try to invest the money
18
The law of increasing costs means that when an economy increases the production of one item
the actual cost goes up but the opportunity cost goes down.
the opportunity cost goes up.
the production costs will not change.
the actual cost of making the item goes down.
19
An efficient economy is one that
makes the best use of all its goods and services.
makes the least costly use of its resources.
has very few people who do not work for a living.
uses its resources to make the most goods and services.
20
The purpose of a production possibilities graph is to
enable a country to mobilize to win a war.
make it possible to increase an economy’s output.
keep an economy from having nonproductive workers.
show alternative ways to use an economy’s resources.
21
The term for the total value of all goods and services produced in a particular economy?
open market value
net worth
standard of living
gross domestic product
22
What is the effect of import restrictions on prices?
They often cause prices to rise steeply and then drop.
They cause prices to rise.
They usually do not have any lasting effect on price.
They cause prices to drop.
23
What happens to a market in equilibrium when there is an increase in supply?
Q supplied will exceed Q demanded, so the price will drop.
Q demanded will exceed Q supplied, so the price will drop.
Undersupply means that the good will become very expensive.
Excess supply means that producers will make fewer goods
24
Which of the following is NOT characteristic of a centrally planned economy?
The central government owns all land and capital.
Each collective or factory sets its own goals.
Each person is assigned a job.
The central government makes all economic decisions.
25
What happens to the money that is withheld from your pay for Social Security?
It is redistributed as cash transfers to injured workers
It is used to provide medical benefits to Americans over 65.
It is redistributed as cash transfers to elderly.
It is put into an account under your name to earn interest