HST 413 2.08 Quiz

Which accurately explains how profit is calculated?

• Total retail sales are determined.

• Costs are subtracted from revenues.

• Benefits and costs are balanced.

• Gross domestic product is calculated.

Which explains how revenue is determined?

• The maximum level of benefits is figured.

• Costs are subtracted from revenues.

• Gross domestic product is calculated.

• The total amount of money brought in by sales is calculated.

Which directly generates revenue for a business?

• output

• assets

• capital

• resources

Which best explains what the profit motive pushes producers to do?

• minimize costs and maximize revenue

• produce as much as possible

• achieve the maximum revenue

• balance monetary and nonmonetary benefits

Which identifies the reason why producers try to minimize costs and maximize revenue?

• government regulations

• market research

• product placement

• the profit motive

Which best states the purpose of using a production possibilities frontier?

• pursuing the profit motive

• maximizing revenue

• balancing economic goals

• setting up efficient production

Which statement best explains how using a production possibilities frontier (PPF) helps set up efficient production?

• A PPF helps predict whether gross domestic product is rising or falling.

• A PPF shows the maximum amount of goods that can be produced with a given set of inputs.

• A PPF allows a producer to calculate the cost of producing one more unit of goods.

• A PPF allows a producer to balance supply and demand in order to find the best selling price.

Which is a market structure that can exist in a free-market system?

• socialist planning

• communism

• government planning

• monopolistic competition

Which is a market structure characterized by at least some competition between producers?

• monopoly

• socialist planning

• oligopoly

• command economy

Which describes a situation where monopolistic competition exists?

• A small number of producers are selling identical products.

• Many producers are selling slightly differentiated products

• Fewer than five producers command the entire market for a certain good or service

• A single producer is the only one selling a good or service with no close substitutes.