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The Final Showdown- Econ

Total questions: 120

Worksheet time: 4hrs 40mins

Name
Class
Date
1.
This part of the market determines DEMAND
a)
buyers
b)
sellers
c)
suppliers
d)
store owners
2.
This part of the market determines SUPPLY
a)
buyers
b)
sellers
c)
consumers
d)
us
3.
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
4.
When quantity supplied and quantity demanded is equal
a)
surplus
b)
shortage
c)
equilibrium
d)
law of demand
5.
What does this curve represent?
a)
supply
b)
equilibrium
c)
demand
d)
surplus
6.
Goods that are bought and used together are 
a)
complementary goods
b)
substitute goods
c)
income goods
d)
unrelated goods
7.
The diagram represents a
a)
increase in demand
b)
decrease in demand
c)
change in quantity demand
d)
none of the above
8.
What does this graph show?
a)
Shortage
b)
Surplus
c)
Supply Table
d)
Equilibrium
9.
The market equilibrium price is the price at which
a)
surpluses depress the number of goods supplied
b)
shortages and surpluses will have no effect on the market
c)
the government will not intervene in the market
d)
the quantity demanded is the same as the quantity supplied
10.
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
11.
Oreo cookies are now extremely expensive to purchase. Instead of buying Oreo cookies, I now want to buy Chips Ahoy. What determinant of demand does this likely fall under?
a)
Change in Price of Complementary Good
b)
Change in Price of Substitute Good
c)
Change in Consumer Price Expectations
d)
Change in Number of Consumers in the Market
12.
The government is giving every individual 18 and above an extra $1,000.00 this year. What determinant of demand does this likely fall under?
a)
Change in Consumer Tastes
b)
Change in Consumer Price Expectations
c)
Change in Number of Consumers in the Market
d)
Change in Consumer Income
13.
I know that the iPhone 8 is coming out next year but really need a phone badly. I'm thinking about buying an iPhone 7 when the new iPhone comes to the market because it will be much cheaper than today's price. What determinant of demand does this suggest?
a)
Change in Price of Complementary Good
b)
Change in Consumer Price Expectations
c)
Change in Number of Consumers in the Market
d)
Change in Consumer Income
14.
McDonald's is having a special on their Big Mac purchases this week. Every Big Mac is $3 cheaper! When burger prices go down, this means you can buy more fries and a drink. What demand factor does this relate to?
a)
Change in Consumer Tastes
b)
Change in Price of Substitute Good
c)
Change in Price of Complementary Good
d)
Change in Number of Consumers in the Market
15.
A brand new machine cooks, cleans, and never messes up a fast food order. This means we can sell more fast food than ever before, leading to producers cutting cost of fast food. Which supply factor does this most likely relate to?
a)
Change in Technology
b)
Change in Profit Opportunities Producing other Products
c)
Change in Producers' Price Expectations
16.

How is a shortage created?

a)

When demand increases.

b)

When demand decreases.

c)

When demand stagnates.

d)

When supply increases.

17.

The delivery of finished products for sale in exchange for revenue is represented in which arrows?

a)

1 and 2

b)

3 and 4

c)

5 and 6

d)

7 and 8

18.

The exchange of money for goods/services to consumers is represented in which part of the circular flow diagram?

a)

1 and 2

b)

3 and 4

c)

5 and 6

d)

7 and 8

19.

What does point C represent on the Circular Flow diagram?

a)

Firm

b)

Factor Market

c)

Individual

d)

Product Market

20.

In the circular flow diagram firms pay wages for which factor of production?

a)

Land

b)

Labor

c)

Entrepreneurship

d)

Raw materials

21.

Where are factors of production (land, labor, etc) exchanged in the circular flow model?

a)

Factor Market

b)

Product Market

c)

Firms

d)

Individuals

22.
Which statement is true about the circular flow diagram?
a)
A  Households are demanders in the product market and suppliers in the factor market
b)
A  Business are demanders in the product market and suppliers in the factor market.
c)
A  Households are demanders in the factor market and suppliers in the product market.
d)
 A  Businesses and households are not components of the circular flow diagram.
23.

Types of cost in the curve are

a)

Total, variable and fixed

b)

Average and marginal

24.

The best definition for fixed costs is

a)

Costs that do not depend on the level of production

b)

Costs that do not change

c)

Costs that increase when you produce more

25.

A person using his own capital in business is an e.g of

a)

implicit cost

b)

explicit cost

26.

Cost per unit of output is

a)

AC

b)

MC

27.

Marginal costs is

a)

the cost added by producing one additional unit

b)

the change in revenue added by producing one additional unit

c)

the additional cost

28.

The shape of Marginal cost is

a)

It first decreases as units increase, then increase

b)

It increases constantly as units increase

c)

It increases as units increase, then it decreases

29.

The formula for marginal costs is

a)

Percentage change in costs divided by percentage change in quantities

b)

Change in costs divided by change in quantities

c)

Percentage change in costs divided by percentage change in prices

30.

The MC curve cuts AC at its

a)

highest point

b)

minimum point

31.

The shape of AFC is

a)

rectangular hyperbole

b)

S shaped

32.

AC is equal to MC where

a)

AC is minimum

b)

MC is minimum

33.
Internal economies of scale are those that
a)
Result from changes in production techniques
b)
Increase due to the growth of the industry as a whole
c)
Generate lower unit costs
d)
Reduce production costs in the short run
34.

External economies of scale can arise from

a)

Bulk purchases of raw materials, parts and components at favorable prices by a particular business/firm

b)

Purchase and use of physical/human capital by a particular business/firm

c)

Greater availability of skilled laborers for a particular industry in a particular area

d)

A business/firm being able to obtain lower interest rates on loans

35.

Wheat has seen a decrease in demand of 5%, while the price has increased 7%

a)

1.4 inelastic

b)

1.4 elastic

c)

.71 inelastic

d)

.71 elastic

36.

Ford Trucks have seen a increase in demand of 27%, while the price has decreased 15%

a)

.56 inelastic

b)

.56 elastic

c)

1.8 inelastic

d)

1.8 elastic

37.

The medication known as insulin has seen a decrease in demand of 2%, while the price has increased 10%

a)

5 inelastic

b)

5 elastic

c)

.2 inelastic

d)

.2 elastic

38.

In Covington, VA 1,700 frozen turkeys were sold in 2016 at an average price of $17. In Covington, VA 1,500 frozen turkeys were sold in 2017 at an average price of $27.

a)

4.98 inelastic

b)

4.98 elastic

c)

.2 inelastic

d)

.2 elastic

39.
a)

A

b)

B

c)

C

d)

D

40.

The graphs show how consumer prices and real GDP changed in a country between 1995 and 2005. Which conclusion may be drawn from the graphs?

a)

Living standards remained roughly constant between 1995 and 2005.

b)

The level of GDP was lower in 2005 than in 2000.

c)

The country experienced continuous economic growth between 1995 and 2005.

d)

The price level fell between 2000 and 2003.

41.

Between 2000 and 2004 Botswana experienced economic growth but there was a fall in its

Human Development Index.

Which combination of events could explain this apparent paradox?

a)

A

b)

B

c)

C

d)

D

42.

Which of the following describes an entrepreneur?

a)

A person who is hired to work in a factory.

b)

A person who organizes, operates, and assumes the risk for a business venture.

c)

A person who organizes loans the money to a new business just getting started.

d)

A person who invests in businesses to make money.

43.

Product differentiation refers to

a)

Features that make one product appear different from competing products in the same market.

b)

Different prices for the same product in a certain market.

c)

The selling of identical products in different markets.

d)

The charging of different prices for the same product in different markets.

44.

Which of the following describes the

opportunity cost to an economy of building

a new airport?

a)

The extra cost of providing

equipment and managers to

operate the airport efficiently.

b)

The closure of the airport it

replaces.

c)

The goods and services that could

have been produced instead of

the airport.

d)

The increase in taxation to the

citizens to pay for the new

airport.

45.

Which of the following factors would

account for a PPF shifting to the right?

a)

A decrease in taxes

b)

A reduction in unemployment

c)

The introduction of subsidies for

industries

d)

Technological advances in the

industries of the country

46.

Which of the following is LEAST likely to

cause a shift in the production possibility

frontier?

a)

An increase in population

b)

The use of unemployed resources

c)

An advancement in technology

d)

The discovery of a new natural

resource

47.

Economics may be described as a “social

science” since it deals with

a)

the economy

b)

the environment

c)

human behaviour

d)

production and consumption

48.

An economic model is a physical representation of an economy

a)

TRUE

b)

FALSE

49.

Macroeconomics is the study of ___________________

a)

individual building blocks in the economy

b)

the relationship between different sectors of the economy

c)

household purchase decisions

d)

the economy as a whole

50.

Microeconomics is concerned with

a)

the economy as a whole

b)

the electronics industry

c)

the study of individual economic behaviour

d)

the interactions within the entire economy

51.

The opportunity cost of a good is

a)

the time lost in finding it

b)

the quantity of other goods sacrificed to get another unit of that good

c)

the expenditure on the good

d)

the loss of interest in using savings

52.

Economics is the study of

a)

production technology

b)

consumption decisions

c)

how society decides what, how, and for whom to produce

d)

the best way to run society

53.

Which of the following is considered a

good?

a)

A visit to the doctor

b)

A commercial bank paying your

utility bill on your behalf

c)

An operator-assisted telephone call

d)

A soft drink purchased at the

school’s cafeteria

54.

An essential feature of a capital good is that

it

a)

must be replaced frequently

b)

is used to produce other goods

c)

must be purchased through a loan

d)

is consumed directly by the

consumer

55.

Which point on the curve is an efficient use of resources?

a)

F

b)

D

c)

E

d)

A

56.

If the price of Kellogg's Corn Flakes goes up from $1.89 to $2.05 and quantity demanded changes from 250 to 210, then the price elasticity of demand would be:

a)

0.47

b)

0.02

c)

250

d)

2.14

57.

The number of goods demanded is greater than producers are willing to sell:

a)
Surplus
b)
Shortage
58.

Elastic or Inelastic demand?

a)

Elastic

b)

Inelastic

59.

Elastic or Inelastic demand?

a)

Elastic

b)

Inelastic

60.

This graph demonstrates

a)

A shift in the supply curve

b)

A higher market price after the shift of the demand curve

c)

A lower market price after the shift of the demand curve

d)

No change in the market quantity after the shift of the demand curve

61.

_____ refers to the desire, willingness, and ability to buy a good or service.

a)

Supply

b)

Demand

c)

Law of Demand

d)

Market Supply

62.

A saving account in a bank represents the function of money:

a)

Store of value

b)

A medium of exchange

c)

A standard for deferred payments

d)

A measure of value

63.

The first four dinner rolls Joan consumes have total utility of 15, 27, 37, and 45 respectively. What is the marginal utility of the 4th dinner roll?

a)

124 units of utility

b)

45 units of utility

c)

11.25 units of utility

d)

8 units of utility

64.
The formula for calculating elasticity of demand is:
a)
The % change in price over the % change in quantity demanded
b)
The % change in quantity demanded over the % change in price
c)
The change in price over the change in quantity demaned
d)
The change in quantity demanded over the change in price
65.

A free good has:

a)

An opportunity cost

b)

No opportunity cost

c)

Excludability

d)

Has a price

66.

Theresa paid $10 for a pizza when she was prepared to pay $15. Theresa's consumer surplus is:

a)

$10

b)

$15

c)

Impossible to calculate

d)

$5

67.
The Law of Supply:
a)
Is the exact replica of the Law Of Demand
b)
Reflects producers offering more of a good as  its price increases and less as its price falls 
c)
Has an inverse relationship with price.
d)
Reflects producers offering less of  a good as its price increases and more of  as its price falls.
68.
Toal Costs=
a)
Variable Costs- Fixed Costs
b)
Fixed Costs - Variable Costs
c)
Fixed Costs + Variable Costs
d)
Variable Costs Divided By Fixed Costs
69.

What do we mean by the unemployment rate?

a)

number of people willing and able to work but not currently employed

b)

proportion of the labour force willing and able to work but not currently employed

c)

proportion of the population willing to work but not currently employed

d)

number of people able to work but not currently employed

70.

Economic growth is a situation where an economy's real GDP increase.

a)

True

b)

False

71.

Actual economic growth is a situation where an economy's growth is fueled by high total spending in an economy.

a)

True

b)

False

72.

Fill in the blank. Inflation is a persistent or sustained __________ in the average level of prices over a period over of time.

a)

Increase

b)

Decrease

c)

Stagnation

d)

Stagflation

e)

None of the answers

73.

True or False. The UK government has a target for inflation of 2% (CPI).

a)

True

b)

False

74.

Which price index includes university fees, stockbroking prices, and new car prices?

a)

Consumer Price Index

b)

Customer Price Index

c)

Retail Price Index

d)

Revenue Price Index

e)

None of the answers

75.

Which cause of inflation occurs when prices rise in the economy due to an increase in the costs of the factors of production?

a)

Cost-push inflation

b)

Demand-pull inflation

c)

Price-push inflation

d)

Supply-pull inflation

e)

None of the answers

76.

Which cause of inflation occurs when excessive growth in demand in the economy results in shortages and firms raise prices?

a)

Cost-push inflation

b)

Demand-pull inflation

c)

Price-push inflation

d)

Supply-pull inflation

e)

None of the answers

77.

Which country experienced hyperinflation in the last 20 years?

a)

USA

b)

UK

c)

Zimbabwe

d)

Japan

e)

None of the countries

78.

Select all the limitations of CPI

a)

Few households are average

b)

Single people have different spending patterns compared to family households

c)

Is slow to respond to new products and services

d)

Does not incorporate increases in quality

e)

None of the answers

79.

Select all of possible consequences of high inflation:

a)

Inequality

b)

Higher interest rates for borrowing

c)

Uncertainty for businesses

d)

Falling real incomes

e)

None of the answers

80.

How does inflation impact interest rates?

a)

Inflation has no impact on interest rates.

b)

Inflation causes interest rates to decrease.

c)

Inflation causes interest rates to remain constant.

d)

Inflation causes interest rates to rise.

81.

What are the negative effects of high inflation on an economy?

a)

Stimulating economic growth, increasing employment opportunities, and boosting consumer spending.

b)

Eroding purchasing power, reducing consumer and investor confidence, distorting price signals, increasing uncertainty, and creating income inequality.

c)

Encouraging investment, promoting innovation, and fostering economic development.

d)

Stabilizing prices, reducing income inequality, and improving financial stability.

82.

What are some economic indicators used to measure inflation?

a)

Unemployment rate

b)

Interest rates

c)

Stock market performance

d)

Consumer Price Index (CPI), Producer Price Index (PPI), GDP deflator

83.
What causes demand pull inflation?
a)
rise in price due to a decrease in supply
b)
a rise in price level due to an increase in consumption
c)
a rise in price due to an increase in the cost of production
d)
a decrease in price due to a decrease in supply
84.

Those who are not willing and able to work at the current wage rate and do not have a job.

a)

Employed

b)

Involuntary unemployed

c)

Voluntary unemployed

85.

Those who are willing and able to work at the current wage rate but do not have a paid job

a)

Employed

b)

Involuntary unemployed

c)

Voluntary unemployed

86.

Unemployment caused by an imbalance between the skills of workers and the requirements of employers

a)

Employed

b)

Structural unemployment

c)

Frictional unemployment

d)

Voluntary unemployment

e)

Cyclical unemployment

87.

Short-term temporary unemployment caused by people being temporarily between jobs or entering the job market for the first time

a)

Employed

b)

Structural unemployment

c)

Frictional unemployment

d)

Voluntary unemployment

e)

Cyclical unemployment

88.

Unemployment caused by a downturn in economic activity

a)

Employed

b)

Structural unemployment

c)

Frictional unemployment

d)

Voluntary unemployment

e)

Cyclical unemployment

89.

Demand for labour comes from

a)

Producers

b)

Consumers

c)

Government

90.

Supply of labour comes from

a)

Producers

b)

Households

c)

Government

91.

Consumption spending is affected by what factors?

a)

Exchange rate

b)

Consumer confidence

c)

Business confidence

d)

Interest rates

e)

Income tax

92.

Economic growth is an ____________ in the value of goods and services produced by an economy over time.

a)

Increase

b)

Decrease

93.

The most common way to measure the level of activity in an economy is?

a)

Inflation

b)

Interest rates

c)

Gross Domestic Product (GDP)

d)

Employment levels

94.

Which of the following is NOT a stage in the economic cycle?

a)

Growth

b)

Boom

c)

Recession

d)

Slow

95.

Unemployment will be at its lowest?

a)

Growth

b)

Boom

c)

Recession

d)

Slump

96.

Unemployment will be at its highest?

a)

Growth

b)

Boom

c)

Recession

d)

Slump

97.

Consumer confidence will be at its highest?

a)

Growth

b)

Boom

c)

Recession

d)

Slump

98.

When consumer confidence is high, people are likely to spend __________?

a)

More

b)

Less

99.

When consumer confidence is low, people are likely to ________ more?

a)

Spend

b)

Save

100.

Periods of growth in the economic cycle are known as...

a)

Recession

b)

troughs

c)

busts

d)

booms

101.

Environmental factors over which businesses have very little control over are known as...

a)

internal

b)

existing

c)

external

d)

international

102.

In a recession, uncertainty about employment can deter spending. Which of the following is a synonym for “deter?”

a)

Discourage

b)

Enable

c)

Facilitate

d)

Permit

103.

What is the study of the behaviour of individuals, households, and companies and is the study of how markets between buyers and sellers work?

a)

Microeconomics

b)

Macroeconomics

c)

Econometrics

d)

Finance

104.

What is the difference between real GDP and nominal GDP?

a)

Real GDP takes into account inflation

b)

Real GDP takes into account population

c)

Real GDP takes into account exchange rates

d)

Real GDP takes into account unemployment

105.

Which of the following is an advantage of division of labour?

a)

Less job satisfaction

b)

Delays in work

c)

Increased speed of work

106.

"Samsung enhances the home experience with products like Samsung Bespoke 4-Door Flex, 110-inch MICRO LED, and JetBot 90 AI+. Continuing sustainability efforts, Samsung announces Galaxy Upcycling at Home and expansion of eco-packaging for TV products in 2021"


The statement is an example of which internal economies of scale?

a)

sustainability

b)

efficiency

c)

research and development

d)

advertising and marketing

107.

What is an example of economies of scale

a)

Realising

b)

Evaluating

c)

Purchasing

108.

Large firms can buy raw materials in bulk at more favourable rates. This is an example of

a)

Purchasing economies of scale

b)

Technical economies of scale

c)

Managerial economies of scale

d)

Marketing economies of scale

e)

Risk bearing economies of scale

109.

Fill in the blank. __________ economies of scale occur due to an increase in the scale of production within a single firm

a)

Internal

b)

External

c)

Complex

d)

Simple

110.

Fill in the blank. Economies of scale is when as output _________, unit costs ________ in the long run.

a)

increases; decrease

b)

increases; increase

c)

decreases; increase

d)

decreases; decrease

111.

Larger firms are better able to diversify into a range of product areas or markets and thus lessen their risk. This is an example of

a)

Financial economies of scale

b)

Technical economies of scale

c)

Managerial economies of scale

d)

Marketing economies of scale

e)

Risk bearing economies of scale

112.

Large firms can negotiate better interest rates on loans; this reduces the costs of borrowing for larger companies. This is an example of

a)

Financial economies of scale

b)

Technical economies of scale

c)

Managerial economies of scale

d)

Marketing economies of scale

e)

Risk bearing economies of scale

113.

Large firms can afford to advertise and sell in larger quantities to develop brand loyalty. This is an example of

a)

Purchasing economies of scale

b)

Technical economies of scale

c)

Managerial economies of scale

d)

Marketing economies of scale

e)

Risk bearing economies of scale

114.

Large firms can take advantage of investing in better machinery and can benefit from the division of labour. This is an example of

a)

Purchasing economies of scale

b)

Technical economies of scale

c)

Managerial economies of scale

d)

Marketing economies of scale

e)

Risk bearing economies of scale

115.

Economies of scale are gained when a business...

a)

decreases it's production and causes an increase in average production costs

b)

increases it's production and causes a decrease in average production costs

c)

maintains production levels and causes an increase in average production costs

d)

increases it's production and causes an increase in average production costs

116.

Which of the following is an advantage of financial EOS?

a)

Paying suppliers higher prices

b)

Lower interest rates for loans

c)

Paying dividends to shareholders

d)

Repeat purchases from loyal customers

117.

Which of the following is a benefit of purchasing economies?

a)

Limited access to specialist staff

b)

Increased advertising costs

c)

Higher unit costs

d)

Bulk buying reduces unit cost

118.

Market share is the _________________ of the market that you control.

a)

proportion

b)

propulsion

c)

quality

d)

customers

e)

weight

119.

What advantage do larger firms have in financial economies?

a)

Increased production costs

b)

Limited access to capital

c)

Higher interest rates

d)

Better lending terms

120.

What is meant by 'diseconomies of scale' in a business context?

a)

The average costs of production decrease with output.

b)

The average costs of production rise with output.

c)

The business experiences constant returns to scale.

d)

The business becomes more efficient as it grows.

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