Smart Economics Review

A(n) ​ (a)   has the role of buying goods and paying for services in an economy.

• consumer
• economist
• producer
• analyst

When someone opens a cupcake bakery, what role would they play in the economy?

• researcher

• analyst

• economist

• producer

One way to determine the strength of the economy is to watch how consumers and producers are acting. An economy can be considered strong when ​ (a)  

• consumer spending is high
• consumer spending is low
• producer spending is high
• production of goods is low

What is a sign of a strong economy?

• Prices of goods and services are rising quickly

• Factories are expanding and restaurants are doing well

• Unemployment rate is high since many people are looking for jobs

• House prices drop since people are not buying them

As a business owner, Marlon analyzed the economy to determine if it is a good time to open a new shop. What facts probably helped him realize that it is a good time do it?

• Low unemployment rate and prices are rising slowly

• High unemployment rate and prices are rising quickly

• Few homes are being sold and restaurants are closing

• Prices aren't changing and factories are shrinking

What is an example of a market economy?

• When government agencies set prices of goods and services

• When businesses set prices based on what they want to earn

• When the law of supply demand sets prices of goods and services

• When consumers only buy goods and services in a market not a mall

In a market economy, supply is ​ (a)  

• goods and services that are offered by producers
• goods and services that are offered by consumers
• producers who buy goods and services
• consumers who buy goods and services

How does the law of supply and demand affect a consumer?

• It can affect the production costs when consumers make things

• It has no effect on the consumer since they are not demanding things

• It can affect the price and availability of goods and services

• It has no effect on the consumer since they are only supplying things

If an item is scarce, how does this affect how it is priced in a market economy?

• The price will decrease

• The price will increase

• The price will not change

• The price will be up and down

Martin has a clothing store and he has managed to get the only pair of sneakers that everyone wants to buy. How is he most likely going to price these shoes?

• He will keep the price the same as his other shoes to be fair

• He will lower the price since demand is very low and there is a surplus

• He will raise the price since demand is high and supply is scarce

• He will raise the price since demand is very low and supply is scarce

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