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Worksheets

Economics Unit 3

Total questions: 137

Worksheet time: 3hrs 3mins

Name
Class
Date
1.
What does this curve represent?
a)
demand
b)
supply
c)
equilibrium
d)
shortage
2.
What does this curve represent?
a)
supply
b)
equilibrium
c)
demand
d)
surplus
3.
If the price of printers goes down, what happens in the market for ink cartridges?
a)
Supply increases.
b)
Supply decreases.
c)
Demand increases.
d)
Demand decreases
4.
A government payment made to a business is a
a)
tax
b)
regulation
c)
subsidy
d)
resource
5.
The following is a factor that will not cause the demand curve to shift:
a)
Advertising
b)
Population
c)
Price
d)
Consumer expectations
6.
A change in quantity demanded is shown
a)
at various points on the demand curve
b)
with a new demand curve drawn above or below the original demand curve
c)
with a vertical line
7.
Consuming more of one good because of a change in price of another good is known as the 
a)
income effect
b)
substitution effect
c)
elasticity effect
d)
demand effect
8.
A table that lists the quantity of a good that a single person will buy at each price in a market.
a)
demand schedule
b)
market demand schedule
c)
elasticity chart
d)
supply and demand graph
9.
In a market economy, who decides on the prices of goods and services?
a)
government
b)
buyers and sellers
c)
firms
d)
local leaders
10.
Generally speaking, the lower the price, the greater the quantity demand.
a)
True
b)
False
11.
If sandals suddenly became very popular, what would happen to the market for basketball shoes? This would cause the ___________ curve for basketball shoes to shift ____________.
a)
demand.........right
b)
demand.........left
c)
supply.......right
d)
supply....... left
12.
If Michael Jordan did advertisements for Steak and Shake, this would cause the ___________ curve for Steak and Shake to shift ____________.
a)
demand.........right
b)
demand.........left
c)
supply.......right
d)
supply....... left
13.
For the law of supply, as price rises, what happens to quantity supplied?
a)
it goes up
b)
it goes down
c)
it stays the same
d)
it is not effected
14.
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
15.

Celebrities everywhere start wearing athleisure. What happens to the market for athleisure?

a)

Demand increases

b)

Demand decreases

c)

Supply increases

d)

Supply decreases

16.

There are these cool jeans that everybody wants. Then, a few exceptionally dorky moms and dads buy those same jeans and talk loudly about how "rad" they are. After that, what happens to the market for those jeans?

a)

Demand increases

b)

Demand decreases

c)

Supply increases

d)

Supply decreases

17.

The price of Clif Bars increases. What happens to the market for Powerbars?

a)

Demand increases

b)

Demand decreases

c)

Supply increases

d)

Supply decreases

18.

Peanut butter becomes more expensive. What happens to the market for jelly?

a)

Demand increases

b)

Demand decreases

c)

Supply increases

d)

Supply decreases

19.

Nationally, Target runs a sale on marshmallows. What happens to the market for graham crackers?

a)

Demand increases

b)

Demand decreases

c)

Supply increases

d)

Supply decreases

20.

When price goes up, quantity demanded __________.

a)

Increases

b)

Decreases

c)

Stays the same

d)

Is not affected

21.

Which of these products are most likely to have elastic demand?

a)

Food

b)

Medications

c)

Electricity

d)

Luxury Automobiles

22.
Elastic or Inelastic?
a)
Elastic
b)
Inelastic
23.
Elastic or Inelastic
a)
Elastic
b)
Inelastic
24.
The diagram represents a
a)
increase in demand
b)
decrease in demand
25.

The law of demand states?

a)

As price decreases quantity demanded increases

b)

As price decreases quantity demanded decreases

c)

As price increases quantity demanded increases

d)

As price increases quantity demanded remains unchanged

26.

A change in the quantity demanded occurs when?

a)

consumers decide to purchase a greater or lesser quantity of a product due to A CHANGE IN PRICE!!!!

b)

consumers decide to purchase a greater or lesser quantity of a product due to a change in incomes

c)

consumers decide to purchase a greater or lesser quantity of a product due to a change in tastes

d)

consumers decide to purchase a greater or lesser quantity of a product due to a change in expectations

27.

The cause of a change in the quantity demanded is?

a)

A change in taste

b)

A change in habits

c)

A change in diapers

d)

A change in price

28.

Graphically, a change in the quantity demanded is represented by?

a)

Shift of the entire demand curve to the left

b)

Shift of the entire demand curve to the right

c)

From one point to another point along the same demand curve

d)

From X to Y axis on the same supply curve

29.

The cause of a change in the quantity demanded is a change in ?

a)

price

b)

consumer taste

c)

number of consumers

d)

consumer expectations

30.

The cause of a change in the quantity demanded is a change in ?

a)

price

b)

taste

c)

attitudes

d)

population

31.

Peanut butter and jelly are what types of goods

a)

substitutes

b)

complements

c)

yummy

d)

yucky

32.

2 products that you use together are?

a)

substitutes

b)

complements

c)

ying and yangs

d)

coke and pepsi

33.

items that you can use to replace another product are

a)

substitutes

b)

complements

c)

merit goods

d)

private goods

34.

Which of the following measures the responsiveness of producers to a price change?

a)

Marginal cost

b)

Elasticity of supply

c)

Equilibrium

35.

The place where the supply curve intersects the demand curve is known as which of the following?

a)

Utility

b)

Equilibrium

c)

Marginal cost

36.

Butter and margarine are examples of which of the following?

a)

complementary goods

b)

substitute goods

c)

shift goods

d)

raw goods

37.
Which of the following best describes the Law of Demand?
a)
As price goes down, demand goes down. (and vice versa).
b)
As price goes down, demand goes up (and vice versa).
c)
As demand goes down, supply goes up.
d)
As demand goes up, price becomes elastic.
38.
A change in demand is shown
a)
along the demand curve
b)
with a new demand curve above or below the original demand curve
c)
without a demand graph
d)
with a totally vertical line
39.
Consuming more of one good because of a change in price of another good is known as the 
a)
income effect
b)
substitution effect
c)
elasticity effect
d)
demand effect
40.
The demand curve always slopes
a)
down and to the right
b)
straight up and down
c)
down and to the left
d)
up and to the right
41.
Price goes on ________
a)
the vertical axis
b)
the horizontal axis
c)
at the origin
d)
the z axis
42.
What goes on the horizontal axis of a demand graph?
a)
price
b)
quantity demanded
c)
quantity supplied
d)
change in demand
43.
Which of the following would NOT cause a demand curve to shift?
a)
a change in a consumer's income level
b)
a change in population
c)
a change in a consumer's expectations
d)
a change in the price of a product.
44.
The demand for a good is _____ when a small change in price causes a large change in the quantity demanded.
a)
elastic
b)
inelastic
c)
related
d)
substituted
45.
Demand for a product is said to be _______ when a change in price causes very little change in quantity demanded.
a)
elastic 
b)
inelastic
c)
related
d)
rigid
46.
A reduction in the overall population of an area will likely cause a demand curve to shift
a)
left
b)
right
c)
 up
d)
not at all
47.

Graphic representation of a demand schedule is called

a)

Demand Curve

b)

Supply Curve

c)

Chart

d)

Graph

48.

Movement along the demand curve is called

a)

Change in Quantity Demanded

b)

Change in Demand

c)

Change in Quantity Supplied

d)

Change in Supply

49.

A shift in the entire demand curve is known as

a)

Change in Demand

b)

Change in Quantity Demanded

c)

Change in Supply

d)

Change in Quantity Supplied

50.
What is created when prices are too low?
a)
surplus
b)
shortage
c)
equilibrium price
d)
subsidy
51.
The law of demand states that, other things equal: 
a)
consumers will buy more of a product at high prices than at low prices.
b)
price and quantity demanded are directly related.
c)
price and quantity demanded are inversely related.
d)
the larger the number of buyers in a market, the lower will be product price.
52.
A market: 
a)
 is an institution that brings together buyers and sellers.

b)
reflects upsloping demand and downsloping supply curves.
c)
always requires face-to-face contact between buyer and seller.
d)
entails the exchange of goods, but not services.
53.

Study of the economic behavior of individuals and firms

a)

demand elasticity

b)

microeconomics

c)

inelastic

d)

diminishing marginal utility

e)

income effect

54.

Extent to which a change in price causes a change in demand

a)

demand elasticity

b)

microeconomics

c)

inelastic

d)

diminishing marginal utility

e)

income effect

55.

Describes a given change in price that causes a relatively smaller change in quantity demanded

a)

demand elasticity

b)

microeconomics

c)

inelastic

d)

diminishing marginal utility

e)

income effect

56.

Decline in extra satisfaction from using additional quantities of a product

a)

demand elasticity

b)

microeconomics

c)

inelastic

d)

diminishing marginal utility

e)

income effect

57.

Change in quantity demanded because a price change altered consumer's real income

a)

demand elasticity

b)

microeconomics

c)

inelastic

d)

diminishing marginal utility

e)

income effect

58.
If the supply and demand curves intersect at a price of $20 then any price above that would result in a(n):
a)
shortage.
b)
equilibrium.
c)
increase in demand.
d)
surplus.
59.

What is true about the substitution effect when the price rises on an item?

a)

The item becomes more popular as the price rises

b)

Consumers will not buy the item or anything like it on principal

c)

The substitute good will also rise in price

d)

Consumers will buy like items that are a substitute for that good

60.
the extra usefulness or satisfaction a person gets from acquiring or using one more unit of a product
a)
supply
b)
demand
c)
marginal utility
d)
diminishing marginal utility
61.
The demand curve is always
a)
upward sloping.
b)
downward sloping
c)
level 
d)
irregular
62.
Buying only one drink instead of two drinks at lunch time describes what concept?
a)
demand
b)
consumerism
c)
marginal utility
d)
diminishing marginal utility
63.
What is the main difference between the individual demand curve and the market demand curve?
a)
only the demand curve is downward sloping
b)
only the market demand curve shows a range of prices that might prevail in the market at a given time
c)
only the market demand curve shows demand for everyone in the market
d)
only the individual demand curve shows how prices affect demand.
64.
What type of expense is rent/mortgage?
a)
fixed expense
b)
variable expense
65.
What type of expense is car insurance?
a)
fixed expense
b)
variable expense
66.
What type of expense is cable/internet?
a)
fixed expense
b)
variable expense
67.
What are the 2 types of expenses?
a)
rent/car
b)
fixed/variable
c)
rent/groceries
d)
none of these
68.

In simple terms, price inelastic supply means:

a)

It is easy to obtain more supply of a product

b)

It is very difficult to obtain more supply of a product

69.

Advertising

a)

Changes consumer expecatations

b)

lowers the cost of inputs

c)

changes producer expectations

d)

changes consumer taste and preferences

70.

If the cost of inputs increases

a)

quantity demanded decreases

b)

demand decreases

c)

quantity supplied decreases

d)

supply decreases

71.

If the cost of inputs increases

a)

quantity demanded decreases

b)

demand decreases

c)

quantity supplied decreases

d)

supply decreases

72.

If the number of producers in a market increases

a)

quantity demanded increases

b)

demand increases

c)

quantity supplied increases

d)

supply increases

73.

If the number of producers in a market increases

a)

quantity demanded increases

b)

demand increases

c)

quantity supplied increases

d)

supply increases

74.

During WWII the supply of cars in america

a)

increased

b)

decreased

c)

stayed the same

d)

didn't exist

75.

If technology makes things easier to produce then supply will

a)

increase

b)

decrease

c)

stay the same

d)

move along the supply curve

76.

If a producer expects the price to increase

a)

supply will increase in the short run

b)

supply will decrease in the long run

c)

demand will decrease in the short run

d)

supply will decrease in the short run

77.

If a product has many substitutes it is considered to have

a)

elastic demand

b)

inelastic demand

c)

elastic supply

d)

inelastic demand

78.

Food and water are necessities therefore

a)

demand is elastice

b)

demand is inelastic

c)

supply is elastic

d)

supply is inelastic

79.

If inputs are hard for a producer to obtain

a)

demand is elastice

b)

demand is inelastic

c)

supply is elastic

d)

supply is inelastic

80.

If inputs are mobile and easy to move

a)

demand is elastic

b)

demand is inelastic

c)

supply is elastic

d)

supply is inelastic

81.
What is the basic principle of the law of supply?
a)
The higher the price, the more people will want to produce the good.
b)
Everyone has a limited supply that they will make.
c)
When a good's price is lower, people will produce more of it.
d)
Services are of interest in the same way that goods are.
82.

DEMAND ELASTICITY

a)

Describes the proportional change in quantity.

b)

Analyzes the effects of a price change.

c)

Analyzes responsiveness to suppl changes.

d)

Measures the extent of change in price to changes in Q.D.

83.

Total revenue =

a)

Price x cost

b)

Price x quantity

c)

Cost x quantity

d)

Sales + costs

84.

Marginal utility refers to

a)

the additional product produced as the firm adds one additional unit of an input

b)

the additional utility that a consumer derives from consuming one additional unit of a good

c)

the amount of utility divided by the number of units produced

d)

all of the above

85.

Which of the following best expresses the law of diminishing marginal utility?

a)

the more a person consumes of a product, the smaller becomes the total utility that he receives from its consumption

b)

the more a person consumes of a product, the smaller becomes the additional utility that he receives from consuming each additional unit

c)

the less a person consumes of a product, the smaller becomes the total utility that he receives from its consumption

d)

the less a person consumes of a product, the smaller becomes the additional utility that he receives from consuming each additional unit

86.
As more of a good is consumed, total utility
a)
increases
b)
decreases
c)
remains the same
d)
becomes negative and then turns positive
87.

As more of a good is consumed, marginal utility

a)

increases

b)

decreases

c)

remains the same

d)

becomes negative and then turns positive

88.
The following graph illustrates
a)
The Law of Increasing Costs
b)
The Law of Demand
c)
Circular Flow Diagram of  Mixed Economy
d)
The Marginal Product of Labor
89.
Which of the following is not a variable cost of owning a vehicle?
a)
Gas
b)
Oil Change
c)
Vehicle Registration
d)
Air filters
90.

Additional cost associated with producing one additional unit of output:

a)

Fixed Costs

b)

Average Costs

c)

Marginal Costs

d)

Emplicit Costs

91.
The amount a firm receives after all costs have been paid.
a)
Revenue
b)
Marginal Profit
c)
Profit
d)
Marginal Revenue
92.
The short run is a time period 
a)
which is less than 3 months.
b)
which is very short. 
c)
in which there is at least 1 fixed factor.
d)
in which all factors are variable.
93.

Costs that do not change when the quanity of output produced changes is called

a)

Fixed Costs

b)

Variable Costs

c)

Explicit Costs

d)

Implicit Costs

94.
Occurs when each addition of an input results in declining quantity of the output
a)
Diminishing Marginal Utility
b)
Diminishing Marginal Costs
c)
Diminishing Marginal Returns
d)
Diminishing Marginal Profits
95.

Illustrates the demand of everyone interested in purchasing a product

a)

demand curve

b)

change in demand

c)

Law of Demand

d)

complements

e)

market demand curve

96.

Extent to which a change in price causes a change in demand

a)

demand elasticity

b)

microeconomics

c)

inelastic

d)

diminishing marginal utility

e)

income effect

97.

Describes a given change in price that causes a relatively smaller change in quantity demanded

a)

demand elasticity

b)

microeconomics

c)

inelastic

d)

diminishing marginal utility

e)

income effect

98.

Decline in extra satisfaction from using additional quantities of a product

a)

demand elasticity

b)

microeconomics

c)

inelastic

d)

diminishing marginal utility

e)

income effect

99.

Change in quantity demanded because a price change altered consumer's real income

a)

demand elasticity

b)

microeconomics

c)

inelastic

d)

diminishing marginal utility

e)

income effect

100.
the extra usefulness or satisfaction a person gets from acquiring or using one more unit of a product
a)
supply
b)
demand
c)
marginal utility
d)
diminishing marginal utility
101.

The table above shows the short run production function for picking apples. Based on the production data, which of the following statements about the marginal product of the fifth worker is true?

a)

it is the maximum that can be attained

b)

it is greater than the marginal product of the first worker due to increasing returns

c)

it is greater than the combined marginal products of all the other workers

d)

it is less than the marginal product of the third worker due to diminishing returns

e)

it is rising due to increasing marginal returns

102.

The table shows the short run production function of a perfectly competitive firm that produces potatoes using one variable input: labor. After which worker does diminishing marginal product first occur?

a)

2nd worker

b)

3rd worker

c)

4th worker

d)

5th worker

e)

6th worker

103.

The table shows the short run production function of a perfectly competitive firm that produces potatoes using one variable input: labor. If the firm can sell as many potatoes as it wants for $2 per pound and has to pay each worker $5 per hour, how many workers should the firm employ to maximize profits?

a)

1

b)

2

c)

3

d)

4

e)

5

104.

Fixed Costs + Variable Cost = _____________

a)

Total Costs

b)

2

c)

3

d)

1

105.

the change in output from hiring one additional unit of labor

a)

Diminishing Marginal Returns

b)

Increasing Marginal Returns

c)

Buying on Margin

d)

Marginal Product of Labor

106.

the level of production in which the marginal product of labor increases as the number of workers increases

a)

Increasing Marginal Returns

b)

Diminishing Marginal Returns

c)

Marginal Product of Labor

d)

Marginal Cost

107.

a cost that rises or falls depending on how much is produced

a)

Variable Costs

b)

Fixed Costs

c)

Total Costs

d)

Marginal Cost

108.

Consumer tastes, advertising , the price of substitutes, the price of complements, and consumer expectations about future prices can cause ....

a)

stampede

b)

bank run

c)

a shift in the supply curve

d)

a shift in the demand curve

109.

The stages of production are based on

a)

the way inputs change in response to decisions

b)

the way total production changes over time

c)

the way marginal product changes as variable inputs are added

d)

the way output changes independent of input

110.

Increased government regulations can cause the supply curve to

a)

shift to the right

b)

increase

c)

decrease

d)

shift to the left

111.

In what order do the three stages of production occur?

a)

negative returns, diminishing returns, increasing returns

b)

increasing returns, negative returns, diminishing returns

c)

increasing returns, diminishing returns, negative returns

d)

diminishing returns, increasing returns, negative returns

112.

Profit is maximized when marginal cost is

a)

less than marginal revenue

b)

greater than the marginal revenue

c)

equal to the marginal revenue

d)

growing at the same rate as marginal revenue

113.

The period of production that allows producers to change the amounts of all inputs

a)

diminishing returns

b)

the short run

c)

increasing returns

d)

the long run

114.

Which of the following can cause an increase in supply?

a)

a decrease in productivity

b)

an increase in taxes

c)

fewer sellers in the market place

d)

a decrease in the costs of inputs

115.

Electricity is an example of a

a)

marginal cost

b)

total cost

c)

variable cost

d)

fixed cost

116.

Amount of a product that producers bring to the market at a given price

a)

Subsidy

b)

Quantity supplied

c)

Supply

d)

Long run

117.

Equals the number of units sold multiplied by the average price per unit

a)

Fixed cost

b)

Supply curve

c)

Total revenue

d)

Variable cost

118.
The production function
a)
Is the relationship between the quantity of inputs used and the resulting quantity of product.
b)
Tells us the maximum attainable output from a given combination of inputs.
c)
Expresses the technological relationship between inputs and output of a product.
d)
All the above.
119.

"The marginal cost of production" is..

a)

The cost of producing one more unit of something.

b)

the cost of becoming a major industry.

c)

the average daily cost of margarine

d)

the cost to purchasers, not the cost to sellers.

120.

If production is elastic...

a)

it is slow and difficult to start producing the product

b)

it is easy to get into the market and to increase production

c)

the industry tends to get very big and can't change production very rapidly.

d)

producers tend to keep producing when prices go down, because it is expensive to production.

121.

Which product is more inelastic?

a)

crude oil

b)

shampoo bottles

122.
On a graph with both a supply and demand curve, where are shortages found?
a)
Above the equilibrium price.
b)
Below the equilibrium price.
123.
On a graph with both a supply and demand curve, where are surpluses found?
a)
Above the equilibrium price.
b)
Below the equilibrium price.
124.

Allocating something scarce among people who want more than is available

a)

Opportunity Cost

b)

Rationing

c)

Scarcity

d)

Demand

125.
What is the result of the government implementing a price floor of $60
a)
There would be a shortage of 100 since it is cheaper for consumers 
b)
There would be a surplus of 100 because it is more expensive for consumers 
c)
There would be a shortage of 100 because it is assisting the suppliers
d)
There would be a surplus of 100 because it is beneficial to consumers 
126.
What is the supply with a price floor of $60?
a)
50
b)
100
c)
150
d)
200
127.
What is the result of the government implementing a price floor of $60
a)
There would be a shortage of 100 since it is cheaper for consumers 
b)
There would be a surplus of 100 because it is more expensive for consumers 
c)
There would be a shortage of 100 because it is assisting the suppliers
d)
There would be a surplus of 100 because it is beneficial to consumers 
128.
What is the supply with a price floor of $60?
a)
50
b)
100
c)
150
d)
200
129.
3. Price floors and price ceilings prevent items from obtaining their equilibrium price.
a)
True
b)
False
130.
4. The minimum wage is an example of a government price control.
a)
True
b)
False
131.
What does this graph show?
a)
Shortage
b)
Surplus
c)
Supply Table
d)
Equilibrium
132.
What is the equilibrium quantity in this graph?
a)
$1.50
b)
$1.00
c)
600
d)
800
133.
At the price of 1.00 there is a 
a)
shortage of 200
b)
surplus of 200
c)
shortage of 400
d)
surplus of 400
134.
If the government set the price at $700, would that be a price ceiling or floor?
a)
Price Ceiling
b)
Price Floor 
c)
Neither
135.
If the government set the price at $300, what would be the result?
a)
Surplus of 4,000
b)
Surplus of 2,000
c)
Shortage of 4,000
d)
Shortage of 2,000
136.
A ___ ___ keeps prices form going any higher and causes a ___.
a)
price ceiling; shortage
b)
price ceiling; surplus
c)
price floor; shortage
d)
price floor; surplus
137.
What is the difference between a demand schedule and a demand curve?
a)
A schedule is a graph and a curve is a table
b)
A schedule is written on paper and a curve is a 3d model
c)
A schedule is a table and a curve is a graph
d)
All of the above

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