Economics Unit

What is a characteristic of a command economy?

• 
  High levels of competition

• Government controls production

• Market forces dictate prices

• 
  Private ownership of resources

Which of the following is NOT a factor of production?

• 
  Land

• Labor

• Technology

• Profit

What does the Production Possibility Curve (PPC) illustrate?

• The relationship between supply and demand

• The effects of market equilibrium

• The maximum output combinations of two goods

• The factors of production

In a market economy, what primarily determines the prices of goods?

• Supply and demand

• Government regulation

• Consumer preferences

• Production costs

What is the effect of a price ceiling in a market?

• Leads to a shortage

• 
  Creates a surplus

• 
  Increases supply

• 
  Stabilizes prices

Which market structure is characterized by a single seller?

• Perfect competition

• Monopolistic competition

• 
  Oligopoly

• 
  Monopoly

What is the law of demand?

• Demand is constant regardless of price

• As price increases, demand decreases

• 
  As price decreases, demand increases

• Demand is influenced by production costs

What is a positive externality?

• Education and vaccinations

• Traffic congestion

• Pollution from factories

• 
  Market monopolies

What happens when there is a shortage in one of the factors of production?

• Production slows or costs rise

• Costs decrease

• Production increases

• Market equilibrium is achieved

Which of the following is a determinant of supply?

• Number of sellers

• Tastes and preferences

• Consumer income

• Population size