WorksheetsPre-Test Economics (McKay)
Total questions: 100
Worksheet time: 50mins
To arrive at an economic decision, a decision-making grid may be used to evaluate
productivity
only durable goods.
alternative choice
only capital goods.
The study of economics is important because it enables us to
describe our standard of living.
increase our consumption of consumer goods.
become better decision makers.
determine what goods ought to be produced.
An economy at its production possibilities frontier is operating
with slow economic growth.
at full potential.
without division of labor.
as a free enterprise economy.
Entrepreneurs are considered the driving force in an economy because they
own a great deal of land.
are the greatest number of people in an economy.
start new businesses.
provide most of the labor.
An example of a market economy is
The Inuit.
the former Soviet Union
the United States
North Korea
The United States can best be described as having a
modified free enterprise system.
traditional system.
command economy.
pure free enterprise system.
Who plays one of the most important roles in the free enterprise system by starting new businesses?
entrepreneurs.
government.
workers.
consumers.
A market economy
does not provide for everyone's basic needs.
limits the choices of goods and services available.
permits extensive government intervention.
offers a high degree of certainty for its workers.
Which economic system can change direction quickly and drastically?
traditional
command
market
mixed
If you were to graph this demand schedule, the demand curve would
slope upward from left to right.
slope downward from left to right.
be horizontal.
be vertical.
If a modest price increase has little or no effect, the demand for the product is
complementary.
inelastic.
elastic.
unit elastic.
Consumers' willingness to replace a costly item with a less costly item is an example of
the substitution effect.
the income effect.
demand elasticity.
compliments.
When the rate of increase in total production is starting to slow down, the firm is operating
in Stage I of production.
in Stage II of production.
in Stage III of production.
as much as it possibly can.
When producers offer fewer products for sale at each and every price,
the supply curve has shifted to the right.
the supply curve has shifted to the left.
the price per unit decreases.
they expect subsidies.
Many businesses are engaging in e-commerce because
subsidies are available to many e-commerce businesses.
fixed costs are minimal.
operating costs never increase.
variable costs can be almost eliminated.
If you were to graph this supply schedule, the supply curve would
be horizontal.
be vertical.
slope upward from left to right.
slope downward from left to right.
Under perfect competition,
products are similar but not identical.
numerous restrictions prevent firms from entering the market.
no seller can sell a product above the prevailing market price.
a single seller can affect price.
Workers who have the skills to operate machines and who require a minimum amount of training are
unskilled labor.
semiskilled labor.
skilled labor.
professional labor.
When labor and management ask a third party to collect information about a dispute and present nonbinding recommendations, they are using
fact-finding.
mediation.
collective bargaining.
arbitration.
The authority to levy a federal income tax comes from
the Fifth Amendment.
the Sixteenth Amendment.
an act of Congress.
the Bill of Rights.
Intergovernmental revenues are generally intended for
education and public welfare.
public transportation.
environmental cleanup.
parks and recreation.
The flat tax...
would increase the need for individuals to hire tax accountants.
includes incentives that promote positive economic behavior.
allows too many loopholes.
simplifies the tax process.
Economics is...
condition of not having enough resources to produce all the things people want
people with all their efforts, abilities, and skills
tools, equipment, machinery, and factories used in the production of goods and service
study of how people try to satisfy their needs through the careful use of scarce resources
Capital represents which definition:
condition of not having enough resources to produce all the things people want
people with all their efforts, abilities, and skills
tools, equipment, machinery, and factories used in the production of goods and service
study of how people try to satisfy their needs through the careful use of scarce resources
Scarcity represents which definition:
condition of not having enough resources to produce all the things people want
people with all their efforts, abilities, and skills
tools, equipment, machinery, and factories used in the production of goods and service
study of how people try to satisfy their needs through the careful use of scarce resources
Labor represents...
condition of not having enough resources to produce all the things people want
people with all their efforts, abilities, and skills
tools, equipment, machinery, and factories used in the production of goods and service
study of how people try to satisfy their needs through the careful use of scarce resources
Opportunity Cost represents...
cost of the next-best alternative use of money, time, or resources when one choice is made rather than another
sum of those economic products that are tangible, scarce, useful, and transferable
alternative choices made by consumers in the marketplace
tangible item that is economically useful or that satisfies an economic want
Which one of these definitions represents wealth?
cost of the next-best alternative use of money, time, or resources when one choice is made rather than another
sum of those economic products that are tangible, scarce, useful, and transferable
alternative choices made by consumers in the marketplace
tangible item that is economically useful or that satisfies an economic want
Which one of these definitions represents Trade-offs?
cost of the next-best alternative use of money, time, or resources when one choice is made rather than another
sum of those economic products that are tangible, scarce, useful, and transferable
alternative choices made by consumers in the marketplace
tangible item that is economically useful or that satisfies an economic want
Which one of these definitions represents Goods?
cost of the next-best alternative use of money, time, or resources when one choice is made rather than another
sum of those economic products that are tangible, scarce, useful, and transferable
alternative choices made by consumers in the marketplace
tangible item that is economically useful or that satisfies an economic want
Capital good is/are...
manufactured good that is used to produce other goods and service
process of using up goods and services to satisfy wants and needs
something we would like to have but is not necessary for survival
something we would like to have but is not necessary for survival
Consumption is/are...
manufactured good that is used to produce other goods and service
the process of using up goods and services to satisfy wants and needs
something we would like to have but is not necessary for survival
something we would like to have but is not necessary for survival
Need(s) is/are...
manufactured good that is used to produce other goods and service
the process of using up goods and services to satisfy wants and needs
something we would like to have but is not necessary for survival
something we would like to have but is not necessary for survival
Want(s) is/are...
manufactured good that is used to produce other goods and service
the process of using up goods and services to satisfy wants and needs
something we would like to have but is not necessary for survival
something we would like to have but is not necessary for survival
Which concept best represents service
work that is performed for someone
a measure of the amount of goods and services produced with a given amount of resources in a specific period of time
economy in which consumers and privately owned businesses make the majority of the WHAT, HOW, and FOR WHOM decisions
economy in which consumers and privately owned businesses make the majority of the WHAT, HOW, and FOR WHOM decisions
Which concept best represents productivity
work that is performed for someone
a measure of the amount of goods and services produced with a given amount of resources in a specific period of time
economy in which consumers and privately owned businesses make the majority of the WHAT, HOW, and FOR WHOM decisions
economy in which consumers and privately owned businesses make the majority of the WHAT, HOW, and FOR WHOM decisions
Which concept best represents a durable good?
work that is performed for someone
a measure of the amount of goods and services produced with a given amount of resources in a specific period of time
economy in which consumers and privately owned businesses make the majority of the WHAT, HOW, and FOR WHOM decisions
economy in which consumers and privately owned businesses make the majority of the WHAT, HOW, and FOR WHOM decisions
Which concept best represents a free enterprise economy?
work that is performed for someone
a measure of the amount of goods and services produced with a given amount of resources in a specific period of time
economy in which consumers and privately owned businesses make the majority of the WHAT, HOW, and FOR WHOM decisions
economy in which consumers and privately owned businesses make the majority of the WHAT, HOW, and FOR WHOM decisions
Social Security is a(n)...
federal program of disability and retirement benefits that covers most working people
organized way in which a society provides for the wants and needs of its people
economic system in which a central authority makes most of the WHAT, HOW, and FOR WHOM decisions
economic system in which private citizens own the factors of production
An economic system is a(n)...
federal program of disability and retirement benefits that covers most working people
organized way in which a society provides for the wants and needs of its people
economic system in which a central authority makes most of the WHAT, HOW, and FOR WHOM decisions
economic system in which private citizens own the factors of production
Capitalism is a(n)...
federal program of disability and retirement benefits that covers most working people
organized way in which a society provides for the wants and needs of its people
economic system in which a central authority makes most of the WHAT, HOW, and FOR WHOM decisions
economic system in which private citizens own the factors of production
Command economy is a(n)...
federal program of disability and retirement benefits that covers most working people
organized way in which a society provides for the wants and needs of its people
economic system in which a central authority makes most of the WHAT, HOW, and FOR WHOM decisions
economic system in which private citizens own the factors of production
Mixed economy is best represented by the following concept...
does not increase even if prices go up
economic system that has some combination of traditional, command, and market economies
economic system in which a central authority makes most of the WHAT, HOW, and FOR WHOM decisions
economic system in which private citizens own the factors of production
Fixed income is best represented by the following concept...
does not increase even if prices go up
economic system that has some combination of traditional, command, and market economies
economic system in which a central authority makes most of the WHAT, HOW, and FOR WHOM decisions
economic system in which private citizens own the factors of production
Profit is best represented by the following concept...
extent to which individuals or organizations are better off at the end of a specific period than they were at the beginning
struggle among sellers to attract consumers
degree to which people are better off financially at the end of a specific period than they were at the beginning
economic system in which the allocation of resources and nearly all other economic activity stems from ritual, habit, or custom
Competition is best represented by the following concept...
extent to which individuals or organizations are better off at the end of a specific period than they were at the beginning
struggle among sellers to attract consumers
degree to which people are better off financially at the end of a specific period than they were at the beginning
economic system in which the allocation of resources and nearly all other economic activity stems from ritual, habit, or custom
Socialism best represented by the following concept...
extent to which individuals or organizations are better off at the end of a specific period than they were at the beginning
struggle among sellers to attract consumers
political and economic system in which the government owns and controls some, but not all, of the basic productive resources
economic system in which the allocation of resources and nearly all other economic activity stems from ritual, habit, or custom
Profit best represented by the following concept...
extent to which individuals or organizations are better off at the end of a specific period than they were at the beginning
struggle among sellers to attract consumers
political and economic system in which the government owns and controls some, but not all, of the basic productive resources
rise in the general level of prices.
Traditional economy means...
economic system in which the allocation of resources and nearly all other economic activity stems from ritual, habit, or custom
rise in the general level of prices
program that provides retirement and disability benefits for working people
economy in which competition is allowed to flourish with a minimum of government interference
Profit means...
economic system in which the allocation of resources and nearly all other economic activity stems from ritual, habit, or custom
rise in the general level of prices
program that provides retirement and disability benefits for working people
economy in which competition is allowed to flourish with a minimum of government interference
Social Security means...
economic system in which the allocation of resources and nearly all other economic activity stems from ritual, habit, or custom
rise in the general level of prices
program that provides retirement and disability benefits for working people
economy in which competition is allowed to flourish with a minimum of government interference
Free enterprise means...
economic system in which the allocation of resources and nearly all other economic activity stems from ritual, habit, or custom
rise in the general level of prices
program that provides retirement and disability benefits for working people
economy in which competition is allowed to flourish with a minimum of government interference
A market economy...
is an economic system in which people and firms act in their own best interests to answer economic questions
is a business owned and run by one person
non-cash charge a firm takes for the general wear and tear on its capital goods
organization of workers formed to represent its members' interests in various employment matters
Sole proprietorship best represents...
an economic system in which people and firms act in their own best interests to answer economic questions
is a business owned and run by one person
is a non-cash charge a firm takes for the general wear and tear on its capital goods
an organization of workers formed to represent its members' interests in various employment matters
Depreciation best represents...
an economic system in which people and firms act in their own best interests to answer economic questions
a business owned and run by one person
a non-cash charge a firm takes for the general wear and tear on its capital goods
an organization of workers formed to represent its members' interests in various employment matters
Labor union best represents...
an economic system in which people and firms act in their own best interests to answer economic questions
a business owned and run by one person
a non-cash charge a firm takes for the general wear and tear on its capital goods
an organization of workers formed to represent its members' interests in various employment matters
A corporation best represents...
form of business organization recognized by law as a separate legal entity having all the rights of an individual
price paid for the use of another's money
a check that transfers a portion of the corporate earnings to a stockholder
funds left over after all of the firm’s expenses, including taxes, are subtracted from its sales
Interest best represents...
form of business organization recognized by law as a separate legal entity having all the rights of an individual
price paid for the use of another's money
a check that transfers a portion of the corporate earnings to a stockholder
funds left over after all of the firm’s expenses, including taxes, are subtracted from its sales
A dividend best represents...
form of business organization recognized by law as a separate legal entity having all the rights of an individual
price paid for the use of another's money
a check that transfers a portion of the corporate earnings to a stockholder
funds left over after all of the firm’s expenses, including taxes, are subtracted from its sales
Net income best represents...
form of business organization recognized by law as a separate legal entity having all the rights of an individual
price paid for the use of another's money
a check that transfers a portion of the corporate earnings to a stockholder
funds left over after all of the firm’s expenses, including taxes, are subtracted from its sales
Which concept represents stock?
ownership certificates in a firm
negotiation by a labor union with management over issues such as pay, working hours, health care coverage, and vacation
organization that promotes the collective interests of its members rather than seeking financial gain for its owners
financial organization that accepts deposits from, and makes loans to, employees of a particular company or government agency
negotiation by a labor union with management over issues such as pay, working hours, health care coverage, and vacation
Which concept represents collective bargaining?
ownership certificates in a firm
negotiation by a labor union with management over issues such as pay, working hours, health care coverage, and vacation
organization that promotes the collective interests of its members rather than seeking financial gain for its owners
financial organization that accepts deposits from, and makes loans to, employees of a particular company or government agency
negotiation by a labor union with management over issues such as pay, working hours, health care coverage, and vacation
Which concept represents nonprofit organization?
ownership certificates in a firm
negotiation by a labor union with management over issues such as pay, working hours, health care coverage, and vacation
promotes the collective interests of its members rather than seeking financial gain for its owners
desire, ability, and willingness to buy a product
extra usefulness gained from using one more unit of a product
Which concept represents demand?
ownership certificates in a firm
negotiation by a labor union with management over issues such as pay, working hours, health care coverage, and vacation
promotes the collective interests of its members rather than seeking financial gain for its owners
desire, ability, and willingness to buy a product
extra usefulness gained from using one more unit of a product
Which concept represents marginal utility?
ownership certificates in a firm
negotiation by a labor union with management over issues such as pay, working hours, health care coverage, and vacation
promotes the collective interests of its members rather than seeking financial gain for its owners
desire, ability, and willingness to buy a product
extra usefulness gained from using one more unit of a product
Elasticity best represents...
measure of consumer responsiveness that shows how a dependent variable responds to a change in an independent variable
products used in place of other products
describes change in demand when a change in price causes a relatively larger change in quantity demanded
part of economic theory that deals with behavior and decision making by individual units
graph showing the quantity demanded at every price
Substitutes best represents...
measure of consumer responsiveness that shows how a dependent variable responds to a change in an independent variable
products used in place of other products
describes change in demand when a change in price causes a relatively larger change in quantity demanded
part of economic theory that deals with behavior and decision making by individual units
graph showing the quantity demanded at every price
Elastic best represents...
measure of consumer responsiveness that shows how a dependent variable responds to a change in an independent variable
products used in place of other products
describes change in demand when a change in price causes a relatively larger change in quantity demanded
part of economic theory that deals with behavior and decision making by individual units
graph showing the quantity demanded at every price
Microeconomics best represents...
measure of consumer responsiveness that shows how a dependent variable responds to a change in an independent variable
products used in place of other products
describes change in demand when a change in price causes a relatively larger change in quantity demanded
part of economic theory that deals with behavior and decision making by individual units
graph showing the quantity demanded at every price
Demand Curve best represents...
measure of consumer responsiveness that shows how a dependent variable responds to a change in an independent variable
products used in place of other products
describes change in demand when a change in price causes a relatively larger change in quantity demanded
part of economic theory that deals with behavior and decision making by individual units
graph showing the quantity demanded at every price
Change in demand best represents?
willingness to buy more or less of a product at the same price
quantity demanded of a product varies inversely with its price
illustrates the quantities demanded by everyone interested in purchasing a product
study of the economic behavior of individual units, such as people and firms
describes a given change in price that causes a relatively smaller change in quantity demanded
Law of demand best represents?
willingness to buy more or less of a product at the same price
quantity demanded of a product varies inversely with its price
illustrates the quantities demanded by everyone interested in purchasing a product
study of the economic behavior of individual units, such as people and firms
describes a given change in price that causes a relatively smaller change in quantity demanded
Market demand best represents?
willingness to buy more or less of a product at the same price
quantity demanded of a product varies inversely with its price
illustrates the quantities demanded by everyone interested in purchasing a product
study of the economic behavior of individual units, such as people and firms
describes a given change in price that causes a relatively smaller change in quantity demanded
Microeconomics best represents?
willingness to buy more or less of a product at the same price
quantity demanded of a product varies inversely with its price
illustrates the quantities demanded by everyone interested in purchasing a product
study of the economic behavior of individual units, such as people and firms
describes a given change in price that causes a relatively smaller change in quantity demanded
Inelastic best represents?
willingness to buy more or less of a product at the same price
quantity demanded of a product varies inversely with its price
illustrates the quantities demanded by everyone interested in purchasing a product
study of the economic behavior of individual units, such as people and firms
describes a given change in price that causes a relatively smaller change in quantity demanded
Supply best represents which concept?
amount of a product that would be offered for sale at all possible prices
cost a business incurs even if there is little or no activity
graph showing the various quantities supplied at all possible prices that might prevail in the market
cost that changes when the rate of operation or output changes
equals the number of units sold multiplied by the average price per unit
Fixed Cost represents which concept?
amount of a product that would be offered for sale at all possible prices
cost a business incurs even if there is little or no activity
graph showing the various quantities supplied at all possible prices that might prevail in the market
cost that changes when the rate of operation or output changes
equals the number of units sold multiplied by the average price per unit
Supply Curve represents which concept?
amount of a product that would be offered for sale at all possible prices
cost a business incurs even if there is little or no activity
graph showing the various quantities supplied at all possible prices that might prevail in the market
cost that changes when the rate of operation or output changes
equals the number of units sold multiplied by the average price per unit
Variable Cost represents which concept?
amount of a product that would be offered for sale at all possible prices
cost a business incurs even if there is little or no activity
graph showing the various quantities supplied at all possible prices that might prevail in the market
cost that changes when the rate of operation or output changes
equals the number of units sold multiplied by the average price per unit
Total Revenue represents which concept?
amount of a product that would be offered for sale at all possible prices
cost a business incurs even if there is little or no activity
graph showing the various quantities supplied at all possible prices that might prevail in the market
cost that changes when the rate of operation or output changes
equals the number of units sold multiplied by the average price per unit
E-commerce represents which concept?
electronic business or exchange conducted over the Internet
principle that suppliers will normally offer more for sale at high prices and less at lower prices
total fixed costs
stage where output increases at a decreasing rate as more units of variable input are added
situation in which suppliers offer different amounts of products for sale at all possible prices
Law of Supply represents which concept?
electronic business or exchange conducted over the Internet
principle that suppliers will normally offer more for sale at high prices and less at lower prices
total fixed costs
stage where output increases at a decreasing rate as more units of variable input are added
situation in which suppliers offer different amounts of products for sale at all possible prices
Overhead represents which concept?
electronic business or exchange conducted over the Internet
principle that suppliers will normally offer more for sale at high prices and less at lower prices
total fixed costs
stage where output increases at a decreasing rate as more units of variable input are added
situation in which suppliers offer different amounts of products for sale at all possible prices
Diminishing returns represents which concept?
electronic business or exchange conducted over the Internet
principle that suppliers will normally offer more for sale at high prices and less at lower prices
total fixed costs
stage where output increases at a decreasing rate as more units of variable input are added
situation in which suppliers offer different amounts of products for sale at all possible prices
Change in Supply returns represents which concept?
electronic business or exchange conducted over the Internet
principle that suppliers will normally offer more for sale at high prices and less at lower prices
total fixed costs
stage where output increases at a decreasing rate as more units of variable input are added
situation in which suppliers offer different amounts of products for sale at all possible prices
Laissez-faire best represents which concept?
philosophy that government should not interfere with business activities
theoretical situation in which well-informed, independent buyers and sellers exchange identical products
market structure in which a few very large sellers dominate the industry
agreeing to charge the same or similar prices for a product
ruling requiring a company to stop an unfair business practice that limits competition
Perfect Competition best represents which concept?
philosophy that government should not interfere with business activities
theoretical situation in which well-informed, independent buyers and sellers exchange identical products
market structure in which a few very large sellers dominate the industry
agreeing to charge the same or similar prices for a product
ruling requiring a company to stop an unfair business practice that limits competition
Oligarchy best represents which concept?
philosophy that government should not interfere with business activities
theoretical situation in which well-informed, independent buyers and sellers exchange identical products
market structure in which a few very large sellers dominate the industry
agreeing to charge the same or similar prices for a product
ruling requiring a company to stop an unfair business practice that limits competition
Price fixing best represents which concept?
philosophy that government should not interfere with business activities
theoretical situation in which well-informed, independent buyers and sellers exchange identical products
market structure in which a few very large sellers dominate the industry
agreeing to charge the same or similar prices for a product
ruling requiring a company to stop an unfair business practice that limits competition
Cease and Desist order best represents which concept?
philosophy that government should not interfere with business activities
theoretical situation in which well-informed, independent buyers and sellers exchange identical products
market structure in which a few very large sellers dominate the industry
agreeing to charge the same or similar prices for a product
ruling requiring a company to stop an unfair business practice that limits competition
Patent best represents which concept?
exclusive right to manufacture, use, or sell any new and useful invention for a specific period
exclusive right of authors and artists to publish, sell, or reproduce their work
requirement that businesses reveal information to the public
formal agreement to set prices or to behave in a cooperative manner
practice of selling the same product at different prices to different buyers
Copyright best represents which concept?
exclusive right to manufacture, use, or sell any new and useful invention for a specific period
exclusive right of authors and artists to publish, sell, or reproduce their work
requirement that businesses reveal information to the public
formal agreement to set prices or to behave in a cooperative manner
practice of selling the same product at different prices to different buyers
Public Discourse best represents which concept?
exclusive right to manufacture, use, or sell any new and useful invention for a specific period
exclusive right of authors and artists to publish, sell, or reproduce their work
requirement that businesses reveal information to the public
formal agreement to set prices or to behave in a cooperative manner
practice of selling the same product at different prices to different buyers
Collusion best represents which concept?
exclusive right to manufacture, use, or sell any new and useful invention for a specific period
exclusive right of authors and artists to publish, sell, or reproduce their work
requirement that businesses reveal information to the public
formal agreement to set prices or to behave in a cooperative manner
practice of selling the same product at different prices to different buyers
Price discrimination best represents which concept?
exclusive right to manufacture, use, or sell any new and useful invention for a specific period
exclusive right of authors and artists to publish, sell, or reproduce their work
requirement that businesses reveal information to the public
formal agreement to set prices or to behave in a cooperative manner
practice of selling the same product at different prices to different buyers
A monopoly best represents a/an...
market structure with only one seller of a product
economy as a whole, including employment, gross domestic product, inflation, economic growth, and distribution of income
refusal to work until demands are met
workers who are able to operate complex equipment and can perform their tasks with little supervision
situation in which an employer can hire only union members
Macroeconomics best represents which concept?
market structure with only one seller of a product
economy as a whole, including employment, gross domestic product, inflation, economic growth, and distribution of income
refusal to work until demands are met
workers who are able to operate complex equipment and can perform their tasks with little supervision
situation in which an employer can hire only union members
A strike best represents which concept?
market structure with only one seller of a product
economy as a whole, including employment, gross domestic product, inflation, economic growth, and distribution of income
refusal to work until demands are met
workers who are able to operate complex equipment and can perform their tasks with little supervision
situation in which an employer can hire only union members
Skilled labor best represents which concept?
market structure with only one seller of a product
economy as a whole, including employment, gross domestic product, inflation, economic growth, and distribution of income
refusal to work until demands are met
workers who are able to operate complex equipment and can perform their tasks with little supervision
situation in which an employer can hire only union members
Closed shop represents which concept?
market structure with only one seller of a product
economy as a whole, including employment, gross domestic product, inflation, economic growth, and distribution of income
refusal to work until demands are met
workers who are able to operate complex equipment and can perform their tasks with little supervision
situation in which an employer can hire only union members
