Economics Practice Test

Which of the following is NOT included in the calculation of Gross Domestic Product (GDP)?

• imports

• exports

• government spending

• savings

In a "Productions Possibility Frontier" model, every possible point on the curve is ________.

"It is specialization, or the division of ________ that makes a country wealthy."

Which circular flow model has arrows going in the correct direction?

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"The key to markets is the concept of _______"

The diagonal orange line represents the ​ (a)   curve.

The diagonal red line represents the ​ (b)   curve.

The dashed, horizontal purple line represents the ​ (c)  

The dashed, vertical blue line represents the ​ (d)  

• supply
• demand
• equilibrium price
• equilibrium quantity.

When ​ (a)   is greater than ​ (b)   , the price will increase,

• demand
• supply

When ​ (a)   is greater than (b)   , the price will decrease,

• demand
• supply

The law of demand states that when the price goes ​up, people buy ​_____.

"I run a coffee shop in the city center.

Unfortunately, a recent frost has severely damaged the coffee bean harvest.

What's likely to happen to the cost of my coffee supplies?"

Will the cost of coffee supplies go UP or DOWN?

• The cost of coffee supplies will go up.

• The cost of coffee supplies will go down.