Chapter 1 Test Review

Advertising that tries to win your favor by comparing its product's qualities to those of a competing product is called

• informative advertising
• comparative advertising
• brand advertising
• persuasive advertising

The value of a second-best choice that is given up when you make a decision is your _____________.

• alternative cost
• forgone cost
• opportunity cost
• omitted cost

____________ is the creation of goods or services from human and nonhuman resources.

• Formation
• Assembly
• Fabrication
• Production

____________ is a contest among sellers to win customers.

• Competition
• Distribution
• Production
• Manufacturing

Advertising that educates you about a product's qualities is called

• informative advertising
• comparative advertising
• persuasive advertising
• brand advertising

Advertising that is designed to appeal to your emotions in order to influence you to buy is called

• persuasive advertising
• defensive advertising
• comparative advertising
• informative advertising

The equilibrium price for a product is the price at which the quantity supplied is _________ the quantity demanded.

• more than
• less than
• exactly equal to
• none of these

If the current price of bread exceeds bread's equilibrium price, we should expect the:

• price of bread to fall and the quantity demanded to decrease.
• price of bread to increase and the quantity demanded to grow.
• price of bread to fall and the quantity demanded to increase.
• price of bread to increase and the quantity demanded to fall.

A purchase made on a whim without using a decision making process is a(n)

• trade-off purchase
• impulse purchase
• option purchase
• rational purchase

The quantity of a product that producers are willing and able to make available for sale at various prices over a given time period is said to be

• surplus
• supply
• demand
• shortage