NEW
Font size
S
M
L
XL
WorksheetsUnit 2 Review
Total questions: 70
Worksheet time: 2hrs 12mins
Name
Class
Date
1.
What does this curve represent?
a)
demand
b)
supply
c)
equilibrium
d)
shortage
2.
What does this curve represent?
a)
supply
b)
equilibrium
c)
demand
d)
surplus
3.
An increase in the price of aspirin is likely to be paired with a(n) ___________________ in the demand for Tylenol because the two goods are __________________.
a)
increase; complements
b)
increase; substitutes
c)
decrease; complements
d)
decrease; substitutes
4.
If the price of printers goes down, what happens in the market for ink cartridges?
a)
Supply increases.
b)
Supply decreases.
c)
Demand increases.
d)
Demand decreases
5.
Assume the image is showing the market for apples. Which of the headlines could indicate the pictured shift is occurring in the market?
a)
Pesticides on apples linked to mouth cancer.
b)
Storms destroy apple orchards.
c)
An apple a day really does keep the doctor away.
d)
New genetic strain leads to apple trees that produce twice as many apples.
6.
The following is a factor that will not cause the demand curve to shift:
a)
Advertising
b)
Population
c)
Price
d)
Consumer expectations
7.
A change in quantity demanded is shown
a)
at various points on the demand curve
b)
with a new demand curve drawn above or below the original demand curve
c)
with a vertical line
8.
In a market economy, who decides on the prices of goods and services?
a)
government
b)
buyers and sellers
c)
firms
d)
local leaders
9.
Generally speaking, the lower the price, the greater the quantity demand.
a)
True
b)
False
10.
For the law of demand, as price rises, what happens to quantity demanded?
a)
it goes up
b)
it goes down
c)
it stays the same
d)
it is not effected
11.
For the law of supply, as price rises, what happens to quantity supplied?
a)
it goes up
b)
it goes down
c)
it stays the same
d)
it is not effected
12.
If Michael Jordan did advertisements for Steak and Shake, this would cause the ___________ curve for Steak and Shake to shift ____________.
a)
demand.........right
b)
demand.........left
c)
supply.......right
d)
supply....... left
13.
If sandals suddenly became very popular, what would happen to the market for basketball shoes? This would cause the ___________ curve for basketball shoes to shift ____________.
a)
demand.........right
b)
demand.........left
c)
supply.......right
d)
supply....... left
14.
The Supply Curve is upward-sloping because...
a)
as price increases, consumers demand less.
b)
none of the choices
c)
as price increases, so do costs.
d)
As the price increases, suppliers can earn higher levels of profit or justify higher marginal costs to produce more.
15.
Rent Control is an example of a..
a)
Price Floor
b)
Price Ceiling
c)
Surplus
d)
Equilibirum
16.
A price floor is an attempt to help...
a)
Producers
b)
Consumers
c)
The Government
d)
Workers
17.
Price controls are
a)
market forces that move a market to equilibrium
b)
legally mandated maximum or minimum prices for a good or service
c)
limits on the amount a company is allowed to produce
d)
limits on the amount a consumer is allowed to purchase
18.
A price ceiling
a)
sets an upper limit on how much producers are allowed to purchase
b)
sets a minimum legal price for a product
c)
sets the maximum legal price for a product
d)
sets a lower limit on how much consumers are allowed to buy
19.
A price ceiling
a)
sets an upper limit on how much producers are allowed to purchase
b)
sets a minimum legal price for a product
c)
sets the maximum legal price for a product
d)
sets a lower limit on how much consumers are allowed to buy
20.
A price ceiling set below the current equilibrium price
a)
leads to a surplus
b)
has no impact
c)
changes the equilibrium
d)
leads to a shortage
21.
Price controls ____________________ with free market forces that establish price
a)
interfere with
b)
interact with
c)
complement
d)
supplement
22.
A price ceiling leads to shortages because, at lower prices,
a)
firms are prohibited from producing as much as they want
b)
companies want to produce more and consumers want to produce more
c)
companies want to supply less and consumers want to buy more
d)
consumers don't want to buy as much
23.
What does this graph show?
a)
Shortage
b)
Surplus
c)
Supply Table
d)
Equilibrium
24.
what is the equilibrium quantity and price shown in this graph?
a)
60 and $280
b)
40 and $300
c)
40 and $320
d)
20 and $280
25.
If a price floor was set at 320, what quantity would be purchased?
a)
20
b)
40
c)
60
d)
80
26.
Which of the following would cause a change in supply?
a)
A change in input costs
b)
A change in technology available
c)
A change in the number of sellers
d)
All of the above
27.
Which of the following would cause a change in supply?
a)
A change in market price
b)
A change in technology available
c)
A change in the number of sellers
d)
All of the above
28.
Price ceilings lead to ___________ and price floors lead to ___________.
a)
surplus;shortage
b)
shortage;surplus
29.
The elasticity on a item such as gas is:
a)
Very elastic
b)
Not inelastic
c)
Very responsive
d)
Inelastic
30.
Which economic concept is defined as the measure of how responsive consumers are to a price change?
a)
consumer expectations
b)
consumer taste
c)
decreasing marginal utility
d)
elasticity of demand
31.
Suppose that when paper plates sell for $2 per package, the demand is 5 million. Which of the following is the total revenue earned?
a)
$10 million
b)
$3 million
c)
$7 million
d)
$1 million
32.
If substitutes are not readily available for a good or service its has
a)
inelastic demand
b)
elastic demand
33.
If substitutes ARE readily available for a good or service it has
a)
elastic demand
b)
inelastic demand
34.
If a good represents a large percentage of a person's total expenditures, it is likely to be have
a)
Elastic demand
b)
Inelastic demand
35.
For diabetics, insulin has inelastic demand because
a)
It is a necessity
b)
Its cost is prohibitive
c)
Of consumer tastes
d)
The price of related goods
36.
What is the Equilibrium Price?
a)
1
b)
2
c)
3
d)
4
37.
What is the Equilibrium Quantity?
a)
50
b)
60
c)
70
d)
80
38.
How many firms are there in a perfect competition?
a)
1
b)
2-5
c)
Many
39.
Why does no one firm dominate in a perfect competition?
a)
No firm wants to
b)
Each firm sells to different people
c)
Each firm produces so little of the total supply that they cannot influence prices
d)
One firm will eventually dominate and make it a monopoly
40.
Factors that make it difficult for new firms to enter a market are called
a)
Barriers to entry
b)
Factors of production
c)
Limited supply
d)
Monopolistic Outlook
41.
How many firms are there in a monopoly?
a)
1
b)
2-5
c)
Many
42.
An industry that is dominated by a few large firms is
a)
monopolistic competition.
b)
a monopoly.
c)
perfect competition.
d)
an oligopoly.
43.
Businesses can "Collude" or work together to set prices
a)
Oligopoly
b)
Monopoly
c)
Perfect Competition
44.
A market structure characterized by firms producing similar product with easy entry into the market
a)
Perfect Competition
b)
Monopolistic Competition
c)
Monopoly
45.
Choose the example that goes best with an oligopoly.
a)
apples
b)
cell phone providers
c)
utilities
d)
clothing
46.
Which of the following industries is an example of a monopoly?
a)
utilities/water
b)
department stores
c)
auto industry
d)
commercial airlines
47.
The jeans industry would fall into what type of market structure? ( jeans are similar but there are some differences in the product)
a)
monopoly
b)
oligopoly
c)
perfect competition
d)
monopolistic competition
48.
Which is NOT a characteristic of a monopoly?
a)
Seller sets the market price
b)
Entry into the market is easy
c)
Firm sells a unique product
d)
One seller
49.
Which is NOT a characteristic of perfect competition?
a)
difficult entry into the market
b)
many sellers
c)
identical product
d)
no control over price
50.
Cartels are illegal in the United States.
a)
True
b)
False
51.
A market that has a few sellers of basically the same goods.
a)
Perfect Competition
b)
Pure Monopoly
c)
Monopolistic Competition
d)
Oligopoly
52.
Firms in this kind of market produce goods that are very close substitutes.
a)
Perfect Competition
b)
Pure Monopoly
c)
Monopolistic Competition
d)
Oligopoly
53.
Public utilities are an example.
a)
Perfect Competition
b)
Natural Monopoly
c)
Monopolistic Competition
d)
Oligopoly
54.
Which market structure has the least amount of competition?
a)
Perfect Competition
b)
Monopolistic Competition
c)
Oligopoly
d)
Monopoly
55.
This type of business is owned by one person.
a)
Partnership
b)
Sole Proprietorship
c)
Corporation
d)
Franchise
56.
Advantages of this business type are that the owner is their own boss and gets to keep all the profits.
a)
Partnership
b)
Sole Proprietorship
c)
Corporation
d)
Franchise
57.
Disadvantages for this type of business include: owner pays for everything, hard to get money to start from the bank, owner might lack skills & unlimited liability.
a)
Sole Proprietorship
b)
Partnership
c)
Corporation
d)
Franchise
58.
A business owner who prefers to maintain complete control of all business activities might consider structuring the venture as a(n)
a)
sole proprietorship
b)
general partnership.
c)
franchise
d)
corporation.
59.
The disadvantages of this business organization include unlimited liability, difficulty raising financial capital, difficulty attracting qualified employees, and having a limited life
a)
Sole Propriotorship
b)
Partnership
c)
Corporation
60.
A partnership in which all partners assume full personal liability for debts of the firm
a)
limited partnership
b)
trading partnership
c)
non-trading partnership
d)
general partnership
61.
Partners who are only responsible up to the extent of their investment
a)
limited partnership
b)
trading partnership
c)
non-trading partnership
d)
special partnership
62.
How is a general partnership organized?
a)
Every partner shares equally in both responsibility and liability
b)
The doctors, lawyers, or accountants who form a general partnership hire others to run the partnership
c)
No partner is responsible for the debts of the partnership beyond his or her investment
d)
Only one partner is responsible for the debts of the partnership
63.
What is a major advantage of a business that is a partnership rather than a sole proprietorship?
a)
The responsibility for the business is shared
b)
The business is easy to set up
c)
The partners are not responsible for business debts
d)
The business is easy to sell
64.
Joe is starting a small home-based consulting business. He possesses computer knowledge but lacks marketing skills. The form of business ownership that Joe might consider establishing is a(n)
a)
corporation
b)
sole proprietorship
c)
monopoly
d)
general partnership.
65.
Which of the following is a disadvantage of corporations:
a)
Double taxation
b)
Unlimited life
c)
Unlimited liability
d)
Financial power
66.
Which of the following is an advantage of the corporation as a form of business ownership:
a)
Less complex requirements
b)
Separate owners and managers
c)
Limited liability
d)
High Taxes
67.
The owners of a corporation are called
a)
Directors
b)
Partners
c)
Shareholders
d)
Founders
68.
Most expensive to start
a)
Sole Proprietorship
b)
Partnership
c)
Corporation
69.
Which of these has an unlimited life?
a)
Sole Proprietorship
b)
Partnership
c)
Corporation
70.
Ownership represented by stock
a)
Sole Proprietorship
b)
Partnership
c)
Corporation
Reset
