WorksheetsEPF Unit 1 test
Total questions: 10
Worksheet time: 5mins
In a command economy, how would resources be allocated (handed out)?
Resources would be allocated by price.
Resources would be allocated by authority
Resources would be allocated by tradition
Resources would be allocated by a lottery
What is an economic peak in the business cycle?
The period when the economy is shrinking and unemployment is rising
The lowest point of economic activity before recovery begins
The point when economic activity is at its highest before growth starts to slow
The phase when businesses begin hiring and production increases
What is one similarity between a traditional and mixed market economy?
Both have no regulation of the market
Both have governments that have strict control on the economy
Issues around resources can be handled by individuals and communities
There are no similiarities
What is the law of demand?
As prices go up, demand goes up
As demand goes up, the curve shifts to the left
As prices go up, demand goes down
As supply goes up, demand goes down
What is a recession?
A period when the economy is growing rapidly and employment is increasing
A time when overall economic activity declines, often marked by falling GDP and rising unemployment
The highest point of economic growth in the business cycle
A phase when consumer spending and business investment reach record levels
A sporting goods store sells basketballs. Before any changes, the store sold 100 basketballs per week at $10 each and 500 basketballs per week at $5 each.
A professional basketball star opens a youth basketball camp in the town. In the weeks before the camp begins, more people start buying basketballs at every price. Which statement BEST describes what happened to the demand for basketballs?
Demand increased because more people wanted basketballs at all prices
Demand decreased because basketball prices stayed the same
Quantity demanded increased only because prices went down
Supply increased due to more basketballs being produced
Many consumers believe that the price of new smartphones will rise next year because of higher production costs. How will this expectation most likely affect the current demand for smartphones?
Current demand will decrease because consumers will wait for newer models.
Current demand will increase because consumers want to buy before prices rise.
Current demand will remain unchanged because expectations do not affect demand.
Current demand will decrease because higher future prices reduce purchasing power.
Consumers notice that only a few large companies dominate the airline industry, and each company closely monitors the pricing decisions of its competitors. Which market structure best describes this industry?
Monopoly, because one firm controls all pricing decisions
Monopolistic competition, because firms sell identical products
Oligopoly, because a small number of firms dominate the market and are interdependent
Pure competition, because firms have no influence over price
Which of the following is the best example of a lagging economic indicator?
Stock market performance
Consumer confidence surveys
Unemployment rate
New housing permits
In economics, what does interdependence mean?
The idea that individuals or businesses rely on each other to make decisions or produce goods and services
The situation in which a single company controls the entire market
The government controlling prices and production of goods
The study of how scarce resources are distributed in society
