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Part II Exam review

Total questions: 19

Worksheet time: 10mins

Name
Class
Date
1.

In economics, the main difference between the short run and long run is

a)

At least 2 months

b)

between 3-4 months

c)

1 calendar year

d)

Enough time has passed for people to adjust to changes

2.

Which of the following would be considered an inferior good?

a)

clothing from salvation army

b)

Ford Mustang

c)

Bose Headphones

d)

Sony TV

3.

The law of demand states

a)

As price goes up, demand goes up

b)

As price goes up, demand goes down

c)

As price goes down, demand goes down

d)

As price has no impact on demand

4.

Which of the following would cause demand to increase?

a)

if supply went up

b)

if people took a pay cut

c)

a product goes out of style

d)

if people have more money

5.

When the price of peanut butter increases, the demand for jelly will

a)

increase

b)

decrease

c)

not change

d)

double in rate

6.

The law of supply states that

a)

As price goes up supply goes down

b)

As supply goes down, price goes up

c)

As price goes up, supply goes up

d)

As price does up, demand goes down

7.

All of the following will cause supply to increase except

a)

technology improves

b)

the cost of production goes down

c)

sellers exit the market

d)

more labor becomes available

8.

Which of the following is a controversy associated with an increase in the minimum wage?

a)

Raising minimum wage will increase prices

b)

Raising minimum wage will increase unemployment

c)

Minimum wage workers are only high school and college kids.

d)

The current minimum wage is not high enough for families to live off of

e)

all of these are controversies

9.

Which of the following would cause supply to decrease?

a)

because of a lack of demand, prices have been dropping

b)

plenty of sunshine and rain leads to successful farm season

c)

customers enter a new market

d)

sellers expect good things to happen

10.

Equilibrium is

a)

price is too low causing a shortage

b)

price is too high causing a surplus

c)

price is at a point where there is no surplus or shortage

d)

no opportunity cost

11.

A surplus of bananas in a competitive market would indicate that

a)

the market will never find the equilibrium price and quantity

b)

the demand curve will increase in order to consume the excess demand

c)

consumers are willing to purchase more bananas the producers are willing to supply at the current price

d)

supermarkets are not selling bananas because the price is too high

12.

a price floor is

a)

government sets a maximum price for a good

b)

the government sets the minimum price for a good

c)

government allows the market to set the price for a good

d)

all the above is true

13.

A price ceiling is

a)

government sets a maximum price for a good

b)

government sets a minimum price for a good

c)

the government lets the market decide the price

d)

all of these are true

14.

The business cycle describes the fact that

a)

unemployment levels are constantly changing

b)

inflation rates are constantly changing

c)

an economy's level of production fluctuates between times of recession and expansion

d)

politicians pass laws that force the economy to act in unpredictable ways

15.

Which of the following would best explain the relationship between GDP and unemployment?

a)

When GDP increases, unemployment decreases

b)

When GDP increases, unemployment increases

c)

When GDP decreases, unemployment decreases

d)

There is no relation between GDP & Unemployment

16.

Which of the following is NOT included when calculating GDP for the United States?

a)

Cars assembled in Michigan and sold in Ohio

b)

Cars manufactured in the US, but sold in Japan

c)

cars manufactured in Japan, but sold in the US

d)

cars manufactured in Michigan, but sold to the US government

17.

If using real GDP per capita for a measurement, economists consider the poorest continent to be

a)

Asia

b)

Africa

c)

North America

d)

South America

18.

All of the following people are considered employed EXCEPT

a)

Jen has been home sick for the past two weeks

b)

Eric has only worked 10 hours last week

c)

John has been on vacation for the past week from his job

d)

Harold, who started his job yesterday on his 15th birthday

19.

All of the following people are considered unemployed EXCEPT

a)

Molly who filled out 3 applications this past week

b)

Ryan who currently serves in the military

c)

Rita who was fired from her job is actively looking for a job

d)

none of the above