WorksheetsEconomics Test 4 review
Total questions: 77
Worksheet time: 2hrs 24mins
Goods and Services provided by a government for the use of all people such as roads and military defense.
Private goods and services
public goods and services
External goods and services
Internal Goods and services
A Sum of money granted by the government or public body to assist an industry or business so that the price of commodity or service may remain low or competitive
Externalities
Subsidies
Tariffs
Taxes
Fares
Market Based Systems of Pollution control whereby individual businesses can buy and sell emission credits even while the total level of industrial pollution is capped at some level
cap and trade
subsidies
tariffs
free-riders
The use of government control or change some practice in the private sector
Regulation
Tariffs
Subsidies
Externalities
Required payments to the government
Subsidies
Free-riders
Taxes
Rent
The sum of consumer surplus and producer surplus
Social Surplus
Social Deficit
Social Security
Social Democracy
The government'r sole in setting units and measurements in a market or regulating the quality of goods
Market System
Market Standards
Market Surplus
Market Tariffs
An Example of a non-excludable and non-rivalrous services
Asteroid Deflection
Cable TV
Internet Services
Health Insurance
A Market in which there are many buyers but only one seller: an example if market failure.
Monopoly
Oligolopoly
Free Market
Oligarchy
A Good, Service, or Resource is described as this if its use by one person does not decrease the quantity available for someone else
Nonrival
Rivalrous
Standard
Free-Rider
A Person who relieves benefit of a good but avoids paying for it?
Forced-Rider
Free-Rider
Tariff-rider
Subsidy-rider
The Struggle among sellers for the currency of consumers
Competition
Cooperation
Tariffs
Free-riders
There are four types of economic systems. Most economies are _____.
Traditional
Command
Market
Mixed
With which term is a command economic system MOST closely associated?
Entrepreneurship
Economic Freedom
Perfect competition
Governmental regulation
Oil, natural gas, and coal
human resources
natural resources
entrepreneurship
capital resources
What is a benefit of the market system?
A Competition ensures choice for consumers.
B Prices equal supply costs
C Unemployment is kept to a minimum
D Wage differentials are small
In a market system, what encourages firms to keep their costs low?
A Competition
B Subsidies
C Taxation
D Rules and Regulations
What encourages firms to produce what consumers demand?
A the desire to keep revenue low
B the chance to make high profit
C the chance to keep cost of production high
D the desire to attract firms in the industry
An increase in demand for a product causes price to (a) . ( rise, fall)
Resources are allocated by (a) [ Price mechanism, consumers)
This provides a (a) to producers that the good is profitable. ( signal, new)
Producers being profit motivated, they will have an (a) to supply more output. (incentive, advantage)
Resources in a market economic system are allocated , (a) . ( without government intervention, with government intervention)
Choose any 3 advantages of market system to consumers
harmful goods
Better Quality
Low Price
Increased choice
which of the following are the disadvantages of a market system
Competition
The rich gets richer and the poor gets poorer
Monopoly
Pollution
In a command economy, how are the prices of goods and services determined?
business owners
the central government
market forces of supply and demand
independent agencies and independent regulators
Marginal benefit: a gain from an increase or loss from a decrease in the consumption of a good or service. "Marginal benefit" is MOST related to what economic concept?
opportunity cost
supply elasticity
demand elasticity
equilibrium price
A firm conducted a market analysis and determined that a new worker should be hired. If the firm decided the price of the product will remain the same, what change should occur initially to maximize revenue?
The firm should increase output.
The firm should decrease output.
The firm should keep productivity the same.
The firm should raise costs other than labor.
What economic system is being described?
- Controlled by strong government
- Usually focuses on industrial goods
- Little attention paid to agriculture and consumer goods
- Government directs industry in need areas
Market
Mixed
Traditional
Command
The fictional country of Lavoria recently passed legislation outlawing the sale of gasoline at a price higher than $5.00 per gallon. Such an action is an example of an action that would be MOST associated with which economic system?
Capitalist
Command
Market
Traditional
What are two advantages that a market economy has over a mixed economy?
more limits on profits
more control over prices and wages
more security and equity for producers and consumers
more freedom and efficiency for producers and consumers
Labracorp is looking to hire an unknown number of workers. Jim wants to be one of those workers. What information would Labracorp need in order to make a rational economic decision regarding Jim's employment?
if Labracorp's total cost is less than its total revenue
if Jim's marginal revenue is greater than his marginal cost
if Jim's marginal cost is greater than his marginal revenue
if Labracorp's total revenue is less than its total cost
David wants to buy a pizza and go to the movies. However, he only has enough money to do one or the other. In order to decide what to spend his limited money on, what must David do?
engage in a rational decision making process
visit a bank
apply for interest
hire a financial adviser
A shift from production level B to production level A would
represent an unattainable level of production and result in an inefficient use of resources.
result in an opportunity cost in the production of output Y and would be considered an efficient use of resources.
result in an opportunity cost in the production of output X and would be considered an efficient use of resources.
result in an opportunity cost in the production of output Y and would be considered an inefficient use of resources.
What does scarcity require people to do?
trade stock
make choices
invest money
seek government assistance
A philosophy that government should not interfere with commerce or trade.
Competitive-price theory
Perfect competition theory
Laissez-faire
Monopoly theory
Which of the following is NOT a condition for a perfect market?
A large number of buyers and sellers
Buyers and sellers deal in identical products
Each buyer and seller acts independently
Buyers and sellers are reasonably well informed
Buyers and sellers must stay in their business unless authorized by the government to get out of that markets-ace
The cost added by producing one additional product or service.
Marginal cost
Marginal revenue
Relative cost
Relative revenue
The additional revenue that will be generated by increasing product sales by one unit.
Profit
Marginal Revenue
Relative Revenue
Profit Maximization
Mark has just hired a new employee and his output has increased from 105 to 119. His marginal cost was $4.19 but his revenue was $18. What should mark do?
Keep the amount of employees he has since he is making a profit.
Fire his new employee due to the new marginal cost being to high.
Hire more employees until marginal cost equals marginal revenue
Fire several employees to keep production costs down
What must be true to reach profit maximization?
MC > MR
MR > MC
MR < MC
MC = MR
The real or imagined differences between competing products in the same industry.
Nonprice competition
Product differentiation
Marketing differential
Oligopoly
Large firms can work together called _________________. The desire to do so is to raise prices which is called ____________________.
Collusion; price fixing
Cartels; price setting
Teamwork; price-fixer-upper
Oligopolies; price determination
Which of the following is most likely an example of a monopoly?
A Starbucks across from Dunkin Donuts
A gas station in the country by itself
3 fast food restaurants all on the same street
A Kroger 4 miles away from a Walmart
There are 3 types of monopolies identify which of the following answer is correct.
Natural- production of a product from a single firm
Geographical- ownership or control of a
manufacturing method, process, or other scientific
advance.
Technological- monopoly based on the absence of other sellers in a certain geographic area
Natural- production of a product from a single firm
Geographical- monopoly based on the absence of other sellers in a certain geographic area
Technological- ownership or control of a
manufacturing method, process, or other scientific
advance.
Natural- ownership or control of a
manufacturing method, process, or other scientific
advance.
Geographical- production of a product from a single firm
Technological- monopoly based on the absence of other sellers in a certain geographic area
Natural- ownership or control of a
manufacturing method, process, or other scientific
advance.
Geographical- monopoly based on the absence of other sellers in a certain geographic area
Technological- production of a product from a single firm
What prevents firms from entering a monopoly?
Barriers to Entry
Technology
Price
Barriers to Travel
Which of the following industries is an example of a monopoly?
utilities/water
department stores
auto industry
commercial airlines
A market that has a few sellers of basically the same goods.
Perfect Competition
Pure Monopoly
Monopolistic Competition
Oligopoly
Firms in this kind of market produce goods that are very close substitutes.
Perfect Competition
Pure Monopoly
Monopolistic Competition
Oligopoly
Public utilities are an example.
Perfect Competition
Natural Monopoly
Monopolistic Competition
Oligopoly
Government monopoly
monopoly created and or owned by the government
the exclusive legal right, given to an originator or an assignee to print, publish, perform, film, or record literary, artistic, or musical material, and to authorize others to do the same.
market structure in which the average costs of production are lowest when all output is produced by a single firm
a government authority or license conferring a right or title for a set period, especially the sole right to exclude others from making, using, or selling an invention.
