Test 1 Flashcards

1
Q

Technological Change is a key force in shaping today’s economy, true false

A

True

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2
Q

The gross domestic product is the dollar value of all goods and services produced by the economy, true false

A

True

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3
Q

A centrally planned economy encourages investment and innovation, true false

A

False

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4
Q

Globalization is the exchange of ______ among countries

Money and other financial assets
Workers and jobs
Good Services ideas and people
Communications

A

Goods services ideas and people

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5
Q

A laissez-faire economy has ____

Rules that promote social equality
Very little government regulation of the economy
Centrally planned economy
A large amount of government regulation

A

Very little government regulation of the economy

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6
Q

Top down management of an economy by the government generally ______

Causes significant increase in GDP
Leads to low rates of economic growth
Creates incentives and opportunities for businesses to expand
Produces exponential results in economic growth

A

Leads to low rates of economic growth

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7
Q

Which of the following is not a monetary measure of economic prosperity

Life expectancy
Household consumption
Gross domestic product
Annual household income

A

Life expectancy

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8
Q

Besides the gross domestic product, another measure of how well an economy is doing is

Presidential popularity polls
Publications and economic journals
Annual household income
Government tax rates

A

Annual household income

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9
Q

Financial markets do not include, which of the following

Stock markets
Nonprofit organizations
Banks
Government regulatory agencies

A

Nonprofit organizations

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10
Q

Federal taxes have, which of the following effects on the economy

If taxes are increased, the economy expand due to a balanced budget
If taxes are decreased, businesses will invest the difference back into the economy
There is no definitive agreement on the effect
Lower federal taxes will cause budget surplus

A

There is no definitive agreement on the effect

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11
Q

For the United States one important benefit of foreign trade is

Access to cheaper goods and services
Less domestic competition
Reality check in the economy
Hires tax revenues from tariffs

A

Access to cheaper goods and services

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12
Q

An example of a company that uses financial market to raise money is

The Social Security administration
Your local carryout restaurant
A local television news website
Ford motor company

A

Ford motor company

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13
Q

Which of the following countries have safety nets that offer a better retirement, benefits and more job security than the US safety net?

European countries
Asian countries
South American countries
Our nearest neighbors

A

European countries

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14
Q

Renewable energy sources provided blank of US energy needs as of 2022

13%
10%
Almost 100%
77%

A

13%

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15
Q

Most people have mixed feelings about the financial markets because

The stock market always falls in the long run
They provide means for the average person to become wealthy
They are controlled by government regulators
They can experience violent swings

A

They can experience violent swings

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16
Q

Which of the following is not mentioned in the textbook is one of its three goals

Showing the way in which the possibilities of today’s economy are expanding
Promoting and understanding of markets
Teaching how to successfully invest money in the stock market
Presenting the basic tools of economics

A

Teaching how to successfully invest money in the stock market

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17
Q

The textbook says that which the following is among the key forces shaping today’s economy
Social networking
The evolution of financial markets
Socialism
Accounting scandals

A

The evolution of financial markets

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18
Q

Supposed the government decides to eliminate some, but not all of the rules that govern how investment banks conduct their business this would be an example of

Central planning
Economic competition
Deregulation
A laissez-faire policy

A

Deregulation

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19
Q

Gross domestic product is

Not a useful indicator of prosperity
The only indicator of prosperity that economist use
One of many indicators of prosperity, all of monetary nature
One of many indicators, prosperity, some of which are some of which are not

A

One of many indicators of prosperity, some of which are monetary, and some of which are not

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20
Q

Which of the following does not explain why there are so many disagreements among the economist

In some cases, the controversy is aggravated by political agendas
In some cases, economist have simply not investigated the issue at hand
In some cases, individuals may stand from policy changes
In some cases there isn’t enough data to answer the question

A

In some cases, economist have simply not investigated the issue at hand

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21
Q

In a market, buyers and sellers

Are in the same place
Compete with one another
Undermine the proper functioning of the economy
Exchange goods and services for money

A

Exchange goods and services for money

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22
Q

Which of the following gives the best reasons why the possibilities of choices of today’s economy are expanding?

Because they constraints that affect their economy, change every day
Because people are more enlightened today than in the past
Because worldwide population continues to grow
Because laws continue to change more activities legal

A

Because the constraints that affect the economy change every day

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23
Q

Who competes with whom in a market?

Sellers compete with other sellers buyers are not part of the competition
Buyers compete with other buyers and sellers compete with other sellers
Buyers and sellers compete with each other
Buyers and sellers compete with the government

A

Buyers compete with other buyers and sellers compete with other sellers

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24
Q

Which of the following cell significant declines between late 2007 and early 2009

House pricing only
Stock prices, housing prices and the US economy
Stock prices and housing prices only
The US economy only

A

Stock prices, housing prices and the US economy

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25
Q

Which of the following is not a good indicator of prosperity

Environmental quality
The size of the safety net
Results from surveys of happiness
Life expectancy

A

The size of the safety net

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26
Q

Individuals in a market economy can be both buyers and sellers true false

A

True

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27
Q

Buyers and sellers who are geographically close to each other are part of the national market true false

A

False

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28
Q

The law of supply says that higher prices tend to blank the quantity of goods or services blank, assuming no other changes

Decrease supplied
Increase supplied
Increase demand
Decreased demanded

A

Increase supplied

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29
Q

The demand schedule is a description of the behavior of blank in the market

Goods or services
Labor
Buyers
Sellers

A

Buyers

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30
Q

Opportunity cost is defined as the value or benefit of the

Equilibrium price
Least valuable item
Most valuable item
Next best alternative

A

Next best alternative

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31
Q

The way that economist explain it the worker is a blank in the blank market

Buyer labor
Seller labor
Seller job
Buyer job

A

Seller labor

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32
Q

If at the market price of $10 per lawn, Maya is willing to mow 15 lawns and at the market price of $15 per lawn. Maya is willing to mow 25 lawns. What does Maya supply curve look like?

It’s slopes down to the right
It slopes up and to the right
It is a vertical line
It is a horizontal line

A

It’s slopes up into the right

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33
Q

In economics satiation means

Eventually, the marginal value of the good consumed decreases
Quantity demanded and quantity supplied rises
The market prices been attained
Eventually, the marginal value of the consumed increases

A

Eventually, the marginal value of the good consumed to decreases

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34
Q

What would it mean if a demand curve sloped upward into the right?

Quantity demanded in price both can only decrease
Quantity demanded increases as the price increases
Quantity demanded in price both can only increase
Quantity demanded decreases as the price increases

A

Quantity demanded increases the price increases

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35
Q

One of the biggest benefits of a market-based economy is

Government regulation
The ability to adapt quickly to change
Consumer protection policies
Central planning

A

The ability to adapt quickly to change

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36
Q

Buying a used textbook from a fellow student is an example of what type of market

Labor
Local
Global
National

A

Local

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37
Q

What phrase do economics use to describe the assumption that everything else about a situation stays the same allowing only one variable such as price to change

Caveat emptor
Vini vidi vici
Ceteris paribus
E pluribus unum

A

Ceteris paribus

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38
Q

When you have to give up one opportunity in order to choose another, the value of the opportunity that is not chosen is called the

Choice equilibrium
Opportunity cost
Opportunity price
Forgone value

A

Opportunity cost

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39
Q

What typically happens when the market price for haircuts rise

Cutting hair would be less profitable
Some hair salons might hire more stylist
Some salons might close
Some stylist would work fewer hours

A

Some hair salons might hire more stylists

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40
Q

The demand schedule reports the quantity demanded at

The market equilibrium price
The average of all prices
Many different prices
Zero price

A

Many different prices

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41
Q

The individual quantity demanded is the amount the blank is willing to blank at a given price

Buyer purchase
Seller purchase
Seller sell
Buyer sell

A

Buyer purchase

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42
Q

A graph plot price versus quantity when price is five dollars quantity is 100 when price is $20. Quantity is 400 a line is drawn from one point of interception to the other graph is pictured above is most likely.

Demand curve because it’s an upward slope
Demand curve because it’s downward slope
Supply curve because it’s an upward slope
Supply curve it’s a downward slope

A

Supply curve because it’s an upward slope

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43
Q

The law of demand says that the most cases of the lower the price the lower the quantity demanded true false

A

False

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44
Q

The loft man suggests that most demand curves will be

Curved
Downward sloping
A straight line
Upward sloping

A

Downward sloping

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45
Q

Access demand generally causes prices to fall true false

A

False

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46
Q

Excess supply occurs when suppliers prepared to sell more at a certain price than buyers are prepared to purchase true false

A

True

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47
Q

Left to themselves most markets will tend towards market equilibrium, true false

A

True

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48
Q

A demand shift is a change in the amount of sellers want to supply at various prices true false

A

False

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49
Q

Government action can cause a significant market demand shift, true false

A

True

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50
Q

For most goods and services and increase and income will cause the demand curve to shift to the left true false

A

False

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51
Q

With inferior goods demand will increase with an increase in income, true false

A

False

52
Q

If supply is inelastic, then a demand shift will have a bigger effect on quantity then on price true false

A

False

53
Q

Market equilibrium is the point where quantity supplied and blank are equal

Market price
Quantity demanded
Equilibrium supply
Quantity sold

A

Quantity demanded

54
Q

The price of which the quantity supply equals quantity demanded is the

equilibrium price
Opportunity cost
Negotiated price
Market price

A

Equilibrium price

55
Q

A demand shift effects

Buyers willingness to purchase at the equilibrium price only
Sellers willingness to sell at the equilibrium price only
Sellers willingness to sell a various prices
Buyers willingness to purchase various prices

A

Buyers willingness to purchase a various prices

56
Q

Movement along the demand curve means a demand schedule blank in the price blank

Stays the same changes
Stays the same, also stays the same
Changes also changes
Changes stays the same same

A

Stays the same changes

57
Q

Luxury good is one whose demand blank is income increases

Rises sharply
Decreases sharply
Does not change
Rises proportionately

A

Rises sharply

58
Q

Demand is an elastic if

That a man curve is bowed outward away from the origin
The quantity demand does not change very much, even if the prices change drastically
The quantity demanded changes more or less proportionally with the price
The curve and towards the origin

A

The quantity demanded not change very much, even if the prices changed drastically

59
Q

If supplies in elastic, then a demand shift will have a blank effect on blank

Bigger quantity them on price
Bigger price than on quantity
Big, both quantity and price
Smaller price then on quantity

A

Bigger price than on quantity

60
Q

How many government causes a man shift to the right?

By increasing taxes
By causing a shift and consumer tastes
By regulating supplies
By requiring consumers to purchase certain products

A

Requiring consumers to purchase certain products

61
Q

In the long run, hotel room prices that are falling as a result of excess supply will blank the quantity of hotel room supplied in the market

Decrease
Increase
Stabilize
Destabilize

A

Decrease

62
Q

A demand shift to the right generally leads to

Lower prices and lower quantities
Lower prices and higher quantities
Higher prices and higher quantities
Higher prices and lower quantities

A

Higher prices and higher quantities

63
Q

What will happen as a result of an increase in demand?

Equilibrium price and quantity both rise
Equilibrium price falls an equilibrium quantity rises
Equilibrium price rises, equilibrium quantity falls
Equilibrium price rises and quantity both fall

A

Equilibrium price and quantity both rise

64
Q

What will happen as a result of an increase in supply?

Equilibrium price and quantity both rise
Equilibrium price falls, and equilibrium quantity rises
Equilibrium price and quantity both fall
Equilibrium price rises in equilibrium quantity falls

A

Equilibrium price falls, and equilibrium quantity rises

65
Q

Inputs for a business or the goods and services that it sells to its customers true false

A

False

66
Q

Revenue was the money that customers pay for the output of the business true false

A

True

67
Q

Cost is what a business receives after subtracting expenses from revenue true false

A

False

68
Q

The marginal product of labor is the extra amount of output. A firm can generate by adding one or more unit of labor true false.

A

True

69
Q

The average product is calculated by dividing total inputs by the number of hours worked to true false

A

False

70
Q

Marginal cost is the added expense producing one more unit of output true false

A

True

71
Q

Variable costs or short term cost and fix costs or long-term costs true false

A

True

72
Q

What is the difference between revenue and cost?

Profit
Output
Input
Production

A

Profit

73
Q

What name is given to the process of turning inputs in the outputs of a business will sell to customers

Production
Revenue
Profit maximization
Profit

A

Production

74
Q

The hours of work supplied by various types of workers are referred to by an economist as

The marginal product
The business know how
Wage hours
Labor

A

Labor

75
Q

If you add too much of anyone input, your business is likely to experience

Accelerated product function
Diminishing marginal cost
Increasing marginal revenue
Diminishing marginal product

A

Diminishing marginal product

76
Q

Output divided by the number of hours worked or by the number of workers is called

Average product
Marginal product
Average input
Marginal revenue

A

Average product

77
Q

The price per unit of labor times the amount of labor used equals the

Labor input
Labor cost
Marginal cost
Marginal labor

A

Labor cost

78
Q

Marginal cost generally rises as

Average cost falls
Quantity produced rises
Quantity produced falls
Average cost rises

A

Quantity produced rises

79
Q

Blank is the amount of money accompany receives for selling its product or service

Cost
Profit
Revenue
Average marginal revenue

A

Revenue

80
Q

A profit maximizing business will increase production as long as

Average product exceeds marginal price
Marginal revenue, exceeds marginal cost
Marginal price exceeds average product
Marginal cost exceeds marginal revenue

A

Marginal revenue, exceeds marginal cost

81
Q

Theodore can make six pizzas in one hour if Theodore labor has a diminishing marginal product what must be true about the number of pizzas that Theodore can produce in three hours

It must be equal to 18
It must be greater than 18
it must be less than 12
It must be less than 18

A

It must be less than 18

82
Q

If Sarah can produce 25 muffins for a total cost of 15, but her production process is subject to increasing marginal costs, which of the following can be the total cost of producing 100 muffins

15
60
80
20

A

80

83
Q

If June can earn $1500 in revenue from painting two houses how much can she earn in revenue from painting three houses?

Less than $2250
More than $2250
Exactly 4500
Exactly $2250

A

Exactly $2250

84
Q

Suppose a local food truck owner occurs a total cost of $200 per month even if he makes Incel no food but that is total cost rises to $202 if he makes and sells one hamburger, which of the following is true

A

His fixed cost is $200. The marginal cost of the hamburger is two dollars.

85
Q

Suppose a local food truck representing a small part of an overall very large market can sell 20 hamburgers for 100 total and can sell 30 hamburgers for 150 total which of the following is not true

The marginal revenue for the 20th hamburgers five dollars
The marginal revenue for the 30th hamburgers five dollars
The total revenue for the 20th hamburger is five dollars
The price of the hamburgers five dollars

A

The total revenue of the 20th hamburger is five dollars

86
Q

If by selling one or more unit of a good a certain business can increase revenue from $500-$525. What is the marginal revenue in this case?

$25
500
525
Marginal revenue cannot be calculated without knowing the quantity

A

$25

87
Q

In 2022 Starbucks had 32.3 billion in revenue and made a gross profit of 21.9 billion what it costs in 2022

10.4 billion
1.4 billion
54.1 billion
27.1 billion

A

10.4 billion

88
Q

Imperfect competition all buyers and sellers are price takers true false

A

True

89
Q

Imperfect competition, if there are no barriers to entry, only lowest cost, businesses will survive in the long run, true or false

A

True

90
Q

A business can escape perfect competition by building a better more innovative, product true false

A

True

91
Q

Monopolistic competition is characterized by

A limited number of sellers with a variety of products,
one seller with a variety of products
One seller with a standardized product
A large number of sellers with similar products

A

A large number of sellers with similar products

92
Q

And oligopoly occurs when there

Are a large number of sellers in a market producing a variety of products
Are a large number of sellers producing similar products
Is only one seller in market
Only a few sellers in market

A

Are only a few sellers in the market

93
Q

Blank collusion can occur when oligopolistic businesses do not directly communicate with each other

Explicit
Implicit
Marginal
Ordinary

A

Implicit

94
Q

An example of a barrier to entry is

Lack of key resource
Plentiful natural resources
Low cost resources
Helpful government regulation

A

Lack of key resources

95
Q

The four main types of market structure are

Land labor, capital and business know how
Perfect competition, monopolistic, competition, oligopoly, and monopoly
Marginal cost of marginal revenue, product and price
Average average cost long run short run

A

Perfect competition, monopolistic competition oligopoly monopoly

96
Q

The profit maximizing rule says that any seller role expand output up to the point where

Marginal revenue is less than the price
Marginal revenue equals marginal cost
Marginal revenue equals price
Marginal cost equals price

A

Marginal revenue equals marginal cost

97
Q

The easiest way to have a monopoly today is

To have the government protect you
Own everything in your market
Have a strong business plan
To be in socialistic country

A

To have the government protect you

98
Q

Market power is

Another term for equilibrium
The ability to rise prices above perfectly competitive prices
The balance between average and marginal product
The combination of price and product

A

The ability to raise prices above perfectly competitive prices

99
Q

For a given market, a profit maximizing monopolist would always charge blank a firm in perfect competition

Higher price then
A price equal to marginal cost unlike
A price equal to marginal cost just like
A lower price than

A

A higher price than

100
Q

If all the restaurants restaurants in a small town, colluded agreed to raise dinner prices this will lead to a loss to society because

Some dinners that could be served would not be served
The restaurant will become too crowded with new customers
Collusion is illegal
The number of dinner serve stay the same, but the buyers face higher prices

A

Some dinners that could be served would not be served

101
Q

Imperfect competition P =MC means

Prophet equals marginal cost
Price equals market cost
Price equals marginal cost
Profit equals market cost

A

Price equals marginal cost

102
Q

Differentiating ones product from the product of one’s competitor as a way to

Escape, perfect competition
Cause profit to tend towards zero
Become a price taker
Increase the degree of competition

A

Escape, perfect competition

103
Q

Most markets meet all of the conditions for perfect competition true false

A

False

104
Q

The public sector include state, local governments, as well as the federal government true false

A

True

105
Q

Private sector includes privately owned businesses and for-profit divisions of various governments true false

A

False

106
Q

The new deal was a government outgrowth of World War II truth false

A

False

107
Q

The era of deregulation began as a result of the governments failed response to the oil price shock of 1973 true false

A

True

108
Q

An example of command and control approaches public education, true false

A

True

109
Q

The new deal was

Legislation passed by the Roosevelt administration
The name of the television game show in the 1930s
A government agency that regulated auto dealerships
The cornerstone of the Kennedy administration

A

Legislation passed by the Roosevelt administration

110
Q

The new deal was

Legislation passed by the Roosevelt administration
The name of the television game show in the 1930s
A government agency that regulated auto dealerships
The cornerstone of the Kennedy administration

A

Legislation passed by the Roosevelt administration

111
Q

Which of the following was not part of the new deal?

Medicare
Federal minimum wage
Unemployment insurance
Social Security

A

Medicare

112
Q

The oil price shock of 1973 was caused by

The drawing up of two major US oil wells
A series of earthquakes in Venezuela
The overthrow of the Iranian government by terrorist
Embargo by the organization of petroleum exporting countries OPEC

A

OPEC

113
Q

The government government share of employees peaks during the

1970s
1940s
1960s
1930s

A

1940s

114
Q

The wage and price control of 1971 was an example of

A mixed approach
A command and control approach
Market-based economics
Free enterprise

A

A command and control approach

115
Q

Rent seeking behavior refers to

Companies that spend money on influencing government rather than nonprofit increasing strategies
A transfer of knowledge between private and public sectors
Companies try to increase profit or improving products
Consumer real estate studies on versing buying

A

Companies that spend money on influencing government than nonprofit increasing strategies

116
Q

Imposing attack on a market generally hurts

Either buyers or sellers but never both
Both buyers and sellers
Sellers more than buyers
Buyers more than sellers

A

Both buyers and sellers

117
Q

The free rider problem can occur when

Government regulates the public transit system
The government tax is a good service
Goods are provided to an individual who receives the benefit, but not pay for it
Welfare programs are not regulated well enough

A

Public goods are provided to an individual who receives the benefit, but not pay for them

118
Q

Blank means the government set the rules for market competition

Market regulation
Market dynamics
Government metrics
Market economics

A

Market regulation

119
Q

The Uniform Commercial Code governs

Commercial transactions between companies and consumers
What can be broadcast on public Airways?
Commercial transactions between the United States and the foreign countries
International commerce transactions

A

Commercial transactions between companies and consumers

120
Q

The securities and exchange commission regulates

The stock market
Auto insurance companies
Non-monetary exchanges like bartering
Security and alarm companies

A

Stock markets

121
Q

Which of the following is not a type of externality?

Market externality
Network externality
Positive externality
Negative externality

A

Market externality

122
Q

The disadvantages of government intervention include

Incentive problems
Reduced regulation
Lower taxation
Achieving desirable goals

A

Incentive problems

123
Q

The unintentional impact that the actions of an individual can have on others is called

The network effect
An externality
A public good
The free rider problem

A

An externality

124
Q

When one person’s actions harm others economist say that a blank is present

Negative externality
Market external
Network externality
Antitrust externality

A

Negative externality

125
Q

A commanded control approach to government regulation works best when

There is a significant agreement on the goals, but not on the best ways to achieve them
There’s a significant agreement on the goals and the best way to achieve them
There’s a significant disagreement on the goals of government regulation
Markets can and will produce socially desirable economic outcomes

A

There is a significant agreement on the goals and the best ways to achieve them