AnswersPersonal Finance and EconomicsMicroeconomics

Microeconomics — Test Answers

25 verified answers1 views
1
Free Preview

Based on the graph, which event could cause the change shown?

A
A product sells out of stores and customers can no longer purchase it.
B
A product becomes less popular and fewer customers purchase it.
C
A product becomes more popular and more customers purchase it.
D
A product is restocked on store shelves and is ready for customer purchase.
2
Free Preview

This chart shows the link between

A
amount of a product and the price a producer pays.
B
interest in a product and the price a consumer pays.
C
amount of a product and the price a consumer pays.
D
interest in a product and the price a producer pays.
3

This graph demonstrates how

A
the amount consumed greatly changes with the price.
B
the amount produced slightly changes with the price.
C
the amount consumed slightly changes with the price.
D
the amount produced greatly changes with the price.
4

What most likely will happen if the pie maker continues to make additional pies?

A
The marginal costs will continue to fall, decreasing the total cost, while the marginal revenue remains the same, decreasing the profit earned for each pie.
B
The marginal costs will continue to fall, decreasing the total cost, while the marginal revenue remains the same, increasing the profit earned for each pie.
C
The marginal costs will continue to rise, increasing the total cost, while the marginal revenue remains the same, increasing the profit earned for each pie.
D
The marginal costs will continue to rise, increasing the total cost, while the marginal revenue remains the same, decreasing the profit earned for each pie.
5

The Davis family grows organic vegetables to sell at a local farmer’s market. Which are factors that directly affect their profit? Choose three correct answers.

A
an increase in customers at the market
B
a sale on organic meats at the market
C
an increase in the cost of farm equipment
D
a change in the market price for non-organic fruit
E
a rise in demand for organic produce
6

When supply is higher than demand, prices will

A
rise until the supply falls.
B
fall until the supply rises.
C
rise until the demand falls.
D
fall until the demand rises.
7

Which statements correctly explain price floors and price ceilings? Choose four correct answers.

A
Price ceilings help consumers by lowering prices.
B
Ineffective price floors tend to be too high.
C
Effective price ceilings are set below equilibrium.
D
Effective price floors are set above equilibrium.
E
Ineffective price ceilings tend to be too low.
F
Price floors help producers by raising prices.
8

Brenda’s Boards manufactures skateboards. Each skateboard sells for $45 and includes the following expenses: $3 for the wheels and mounts, $1 for the plastic board, $1 for the paint, and $10 for the labor. What is the total profit the company earns after selling 100 boards?

A
$300
B
$350
C
$3,000
D
$3,500
9

In economics, if a good is inelastic,

A
its supply or demand is too sensitive to price changes.
B
producers have lost an interest in manufacturing it.
C
its supply or demand is not sensitive to price changes.
D
consumers have lost an interest in purchasing it.
10

The point of maximum profit is the point at which the marginal cost equals the

A
production cost.
B
marginal revenue.
C
total revenue.
D
market price.
11

In pure competition, producers compete exclusively on the basis of

A
producing the unique features of their good.
B
advertising heavily to promote their good.
C
selling identical items.
D
focusing on maintaining a positive image.
12

Goods that are considered to be needs tend to be

A
elastic when the price changes.
B
elastic when the supply changes.
C
inelastic when the price changes.
D
inelastic when the supply changes.
13

Why is pure competition considered an unsustainable system?

A
Producers cannot make a profit if they keep dropping their prices.
B
Price differentiation is often too minimal to matter.
C
Consumers cannot distinguish between products.
D
Few barriers exist to entry, meaning that the market inevitably floods.
14

According to the law of supply, price and quantity move

A
from the same point away from one another.
B
along a track in the same direction.
C
along a track in opposite directions.
D
from different points toward one another.
15

A market supply schedule shows

A
how prices affect a group of consumers.
B
the products of two companies only.
C
how prices affect a single producer.
D
the prices and quantity in an entire market.
16

Which best describes the availability of substitutes in a monopoly?

A
Products have different features.
B
There are different brands.
C
There are no substitutes.
D
Price points vary.
17

Which aspect of monopolistic competition gives consumers more choice?

A
Producers are more concerned about selection than profits.
B
Price is not an important factor.
C
Few barriers to market entry exist.
D
Producers rely on consumer decisions to succeed.
18

The total amount of a product available in a market at a given price is called the

A
demand.
B
count.
C
supply.
D
number.
19

Brenda’s Boards manufactures skateboards. Each skateboard sells for $45 and includes the following expenses: $3 for the wheels and mounts, $1 for the plastic board, $1 for the paint, and $10 for the labor. What is the total revenue the company makes after selling 10 boards?

A
$350
B
$450
C
$300
D
$400
20

Which best describes how the government sanctions technological monopolies?

A
by issuing a patent for the technology
B
by creating the technology itself
C
by prohibiting others from entering the market
D
by authorizing one producer

Did you find these answers helpful?

More from this Course

Quiz
25 verified answers

Test

Quiz
25 verified answers

Test

Quiz
22 verified answers

Test