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WorksheetsEconomic Test
Total questions: 29
Worksheet time: 15mins
Which of the following is NOT an accurate statement based on the laws of supply and demand?
When the supply of a product increases, prices tend to fall.
When demand for a product goes up, prices can be set higher.
The price point at which supply and demand are equal is said to be the equilibrium point.
When demand for service goes down, a business will increase prices to make up for the loss of sales.
Advertising a product for a great price and then not having it available for consumers to purchase is part of which practice?
price fixing
none of the above
bait & switch
price discrimination
Which of the following allows consumers to negotiate prices?
psychological pricing
promotional pricing
one-price policy
flexible pricing promotion
Which of the following statements is true regarding markup?
Markup does not take into account the profit you want to make.
Markup must be sufficient to cover operating expenses and allow profit.
Markup is not affected by operating expenses.
None of the above.
The business cycle
does not greatly affect sports and entertainment businesses.
is a well-defined, predictable pattern in the U.S. economy.
refers to the ups and downs of the economy.
all of the above
Which of the following is characteristic of the expansion phase of the business cycle?
less discretionary income
decreased competition
increased consumer demand
growing unemployment
Which of the following practices is restricted by law?
price fixing
price discrimination
bait & switch
all the above
The downside of the business cycle, when the economy slows down and unemployment goes up, is called
inflation
contraction
peak
expansion
Occurs when related businesses conspire to charge high prices.
markup
price fixing
scarcity
price lines
The lack of resources
scarcity
shoulder period
inflation
law of supply
The inverse relationship between price and demand - when the price goes up, demand goes down; when price goes down demand goes up.
law of supply
equilibrium
law of demand
business cycle
The ups and down of the economy
law of demand
equilibrium
law of supply
business cycle
The point at which supply and demand are the same
equilibrium
law of demand
law of supply
business cycle
A period of moderate demand
equilibrium
shoulder period
inflation
scarcity
Occurs when prices for goods and services rise faster than consumer income
scarcity
inflation
shoulder period
equilibrium
All of the costs associated with running a business in addition to the cost of the merchandise.
inflation
operating expenses
business cycle
price lines
The amount that is added to the cost of a product or service to cover operating expenses and to allow for a profit.
inflation
markup
price fixing
equilibrium
A strategy whereby the price of a product is reduced below the store's cost to create more customer traffic.
bait and switch
price fixing
loss-leader pricing
price lines
Occurs when a product that is advertised at a low price is "out of stock," so the salesperson tries to sell customers a higher-priced alternative.
price fixing
price lines
loss-leader pricing
bait and switch
Distinct categories of merchandise based on price, quality, and features
price discrimination
price lines
price fixing
loss-leader pricing
Occurs when an individual, group, or business is charged a higher price than others purchasing the same product or service
law of supply
price fixing
price discrimination
price lines
The relationship between price and supply - when the price goes up, the supply produced goes up; when the price goes sown, the supply produced goes down
price lines
law of demand
law of supply
price discrimination
Which of the following is an example of prestige pricing?
charging wealthy customers higher prices than other customers
charging high prices for status products
negotiating prices at a swap meet
selling a football jersey for $19.99
Which of the following practices is restricted by law?
price discrimination
bait & switch
price fixing
all the above
At the point where supply of a product is the same as demand
the market for the item is said to be in equilibrium
the price is set at its optimum point
inflation will occur
both the first and second answer
Polo and Chaps, which are Ralph Lauren brands, are examples of
promoting pricing
prestige pricing
price lines
psychological pricing
Which of the following is an example of psychological pricing?
charging wealthy customers higher prices than other customers
charging high prices for status products
using bait-and-switch pricing tactics
pricing merchandise at $49.99 instead of $50
Why would a store be willing to lose money on a loss-leader item?
making a profit is not important to the store
loss-leaders will bring customers into the store
customers will also purchase items with higher markups
both the second and third answers are correct
What is the pricing strategy called that has price tags end in .95 or .99 ?
promotional pricing
flexible pricing policy
odd-number pricing
psychological pricing
