Economics Final Exam Review

In what type of economy does the government own and control the factors of production?

• Free Market

• Mixed

• Command

 What is the opportunity cost of an activity?

• The value of the best alternative not chosen

• Nothing, if you choose the activity voluntarily

• The time spent performing the activity

Which best represents scarcity?

• The private ownership of society's resources

• Not enough resources to satisfy unlimited wants

• When sellers do not sell all the goods they produce

A car would be which factor of production for a pizza delivery company?

• Capital

• Land

• Labor

The price of coffee increases, causing you to drink more tea.  What best describes the reasoning behind your actions?

• Your income has increased

• The price of tea and coffee are unrelated

• Tea and coffee are substitute goods

Why does the quantity supplied increase as the price the item sells for increases?

• Producers are willing and able to sell more at higher prices

• Producers want to sell more when prices go down

• More products are supplied at lower prices

Of the following market structures, which gives firms the most control over price in the market?

• Oligopoly

• Monopoly

• Perfectly Competitive

Where is equilibrium?

• Where quantity supplied is greater than quantity demanded

• Where quantity supplied meets quantity demanded

• Where quantity supplied is less than quantity demanded

What does the law of demand state?

• By producing a product, firms create a demand for it

• There is no relationship between price and quantity demanded demand

• As price goes up, quantity demanded goes down

The US Dollar is an example of which type of money?

• Commodity money

• Monopoly money

• Fiat money