Economics Practice 2.1

1. A system where people can own their own business of their choice is called _____________.

• Planned System

• Market Economy or Free Enterprise

• Options System

• Taxes

2. A ______________ is how much of a product a business can provide.

• Demand

• Profit

• Supply

• Consumer

3. In general, if the price of a good or service goes down, what happens to the demand for that good or service?

• demand goes up

• demand goes down

• demand stays the same

• none of the above

4. The week before Halloween, pumpkin patches all around the country sell lots of pumpkins. What will happen to the price of pumpkins on the day after Halloween?

• The price will go up.

• The price will go down.

• Price remain same

5. What exists when quantity supplied is greater than quantity demanded?

• Surplus

• Overflow

• Shortage

• Mass outrage

6. Both items we usually called it as

• Substitute Goods

• Complementary Goods

• Free goods

7. Both items we usually called it as

• Substitute Goods

• Complementary Goods

• Free goods

8. Jennifer Lopez is seen wearing a new short and sleek dress. People now want this dress. Which demand determinant is this most likely to fall under?

• Change in Consumer Income

• Change in Price of Substitute Good

• Change in Consumer Tastes

• Change in Consumer Price Expectations

9. The government is giving every individual 18 and above an extra $1,000.00 this year. What determinant of demand does this likely fall under?

• Change in Consumer Tastes

• Change in Number of Consumers in the Market

• Change in Consumer Price Expectations

• Change in Consumer Income

10. I know that the iPhone 8 is coming out next year but really need a phone badly. I'm thinking about buying an iPhone 7 when the new iPhone comes to the market because it will be much cheaper than today's price. What determinant of demand does this suggest?

• Change in Price of Complementary Good

• Change in Number of Consumers in the Market

• Change in Consumer Price Expectations

• Change in Consumer Income