4044846
Question 1
Question
Economics is the study of how individuals and societies allocate their limited resources in attempts to satisfy their unlimited wants.
Answer
- True
- False
Question 2
Question
Utility is the economic term for the satisfaction obtained from consumption of a good (or service).
Answer
- True
- False
Question 3
Question
The 3 basic resources in economic are:
Answer
-
Natural resources (e.g. land)
-
Labor
-
Capital (i.e. money, physical resources)
-
There's really only 2 basic resources; Natural resources (e.g. land) and Capital (i.e. money, physical resources).
Question 4
Question
Cost is proportional to constraints.
Answer
- True
- False
Question 5
Question
Law of diminishing marginal utility: the satisfaction received by obtaining one more unit of a good declines as one consumes more of it.
Answer
- True
- False
Question 6
Question
___________ is determined by marginal utility – the satisfaction obtained from receiving one more of a good (or service).
Answer
-
Value
-
Cost
-
Supply
-
Free market
Question 7
Question
Law of ___________: the quantity demanded of a commodity is inversely proportional to its price. (i.e. the higher the price, the less of it one wants.)
Answer
-
demand
-
supply
-
diminishing marginal utility
Question 8
Question
Change in ________________ moves along the demand curve.
Answer
-
quantity demanded
-
demand
Question 9
Question
Change in __________ is when the entire curve shifts.
Answer
-
demand
-
quantity demanded
Question 10
Question
Factors that change demand: (check all that applies)
Answer
-
Prices of related goods (substitutes or complements)
-
Money income of the consumer (Superior goods or inferior goods)
-
Number of consumers in the market
-
Attitudes, tastes, and preferences of the consumer
-
Consumer expectations with respect to future prices and incomes
Question 11
Question
Law of supply: as the price that individuals are willing to pay for a product increases, the more of the product that will be supplied.
Answer
- True
- False
Question 12
Question
Change in _______________ moves along the supply curve.
Answer
-
quantity supplied
-
supply
Question 13
Question
Change in ___________ is when the entire curve shifts.
Answer
-
supply
-
quantity supplied
Question 14
Question
Factors that change supply include? (check all that applies)
Answer
-
Techniques of production, including technology
-
Number of sellers in the market (more sellers = more supply)
-
Resource costs (material and wages) (cost increase, seller makes less, less incentive to produce)
-
Sellers’ expectations
-
Prices for related goods
Question 15
Question
The __________________ is that price where the demand curve and supply curve intersect.
Answer
-
market equilibrium price
-
price system
Question 16
Question
The _________ system – the interaction of supply and demand – determines how economic resources are allocated.
Answer
-
price
-
supply
-
market equilibrium
Question 17
Question
Elasticity measure the responsiveness of consumer demands to a change in price.
Answer
- True
- False
Question 18
Question
What type of elasticity of demand is this?
Demand is _______ if an increase in price causes the quantity demanded to decrease enough to result in a decrease of total revenue.
￪P,￬R
Answer
-
Elastic demand
-
Inelastic demand
-
Unitary demand
Question 19
Question
What type of elasticity of demand is this?
Demand is _________ if total revenue is unchanged regardless of changes in price.
Not present in the real world.
Answer
-
Unitary demand
-
Inelastic demand
-
Elastic demand
Question 20
Question
What type of elasticity of demand is this?
Demand is ________ if an increase in price does not result in a sufficient decrease in quantity demanded to prevent a decrease in revenue.
￪P,￪R
Answer
-
Inelastic demand
-
Elastic demand
-
Unitary demand
Question 21
Question
Determinants of elasticity of demand:
-Availability of substitutes
-Price relative to income
-Number of alternatives
Answer
- True
- False
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