Business Essentials Pre-Test

Which of the following scenarios would probably cause prices to drop?

• Many companies begin producing a product in relatively high demand

• A big snowstorm is approaching, and the only hardware store in town has just a few snow shovels left in stock

• Half the world's diamond mines shut down production

• A new snack food is very popular, and only one company produces it.

The largest producer of goods and services in the world is

• Russia

• China

• The United States

• Japan

Generally, as the price of a product increases,

• the supply curve will slope downward

• consumers will be willing to purchase larger quantities of the product

• demand will increase

• businesses will be willing to supply larger quantities of the product

Which of the following would economists most likely classify as a need?

• A battery-powered automobile

• A part-time job to earn some extra money

• Gasoline for a florist's delivery truck

• A flat-screen television

Which of the following addresses the economic question of how to produce?

• producing more capital goods and fewer customer products

• requiring individuals to complete specific types of work

• growing corn instead of potato's

• selling natural resources to other countries

The primary reason business owners make investments and take risks in a private enterprise economy is to

• make a profit

• satisfy customer needs

• develop new products

• meet government requirements

Which of the following would NOT be included in GDP?

• automobiles purchased

• purchases of computers by government

• exports to other countries

• dinner preparation for your family

Productivity would likely increase as a result of

• higher taxes

• lower interest rates

• expanded production technology

• decreased training programs

When a country's imports exceed its exports, there is a trade

• deficit

• surplus

• balance

• exchange

A country that wishes to enhance international trade activities would most likely use

• a quota

• an embargo

• a tariff

• a common market