AnswersGalliWCA 2221 CivicsEconomics 1st nine weeks 26-27Determining Market Price

Determining Market Price — Unit test Answers

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

A
Ineffective price floors tend to be too high.
B
Ineffective price ceilings tend to be too low.
C
Price floors help producers by raising prices.
D
Price ceilings help consumers by lowering prices.
E
Effective price floors are set above equilibrium.
F
Effective price ceilings are set below equilibrium.
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A
elasticity
B
quality
C
time
D
quantity
3

Equilibrium occurs when supply and demand coordinate to

A
set excess demand.
B
set prices and production.
C
maintain excess supply.
D
raise prices and production.
4

A possible result of disequilibrium is

A
excess demand.
B
lower demand.
C
fixed prices.
D
stable availability.
5

Why is pure competition considered an unsustainable system?

A
Price differentiation is often too minimal to matter.
B
Few barriers exist to entry, meaning that the market inevitably floods.
C
Consumers cannot distinguish between products.
D
Producers cannot make a profit if they keep dropping their prices.
6

When supply is higher than demand, prices will

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

The graph shows a point of equilibrium.If quantity demanded exceeds quantity supplied, what most likely needs to happen to achieve equilibrium?

Question illustration
A
The supply needs to increase
B
The price needs to decrease
C
The price needs to increase
D
The demand needs to increase
8

The graph is a marginal cost curve that compares expenses for producing apple pies.According to the graph, the marginal cost begins to increase when the producer makes

Question illustration
A
two pies.
B
three pies.
C
four pies.
D
five pies.
9

Which statement best explains the role of producers in economics?

A
Producers supply goods and services.
B
Producers purchase goods and services.
C
Producers create theories about the market.
D
Producers sell shares for companies in the market.
10

The highest amount a landlord can charge for rent is an example of

A
an incentive.
B
a price floor.
C
a price ceiling.
D
an elastic service.
11

When prices drop below the point where supply and demand meet, it results in

A
coordination.
B
disequilibrium.
C
equilibrium.
D
production.
12

Look at the chart comparing the price of graphic T-shirts to the quantity supplied.

Question illustration
A
demand curve.
B
demand schedule.
C
supply curve.
D
supply schedule.
13

The chart shows the marginal cost and marginal revenue of producing apple pies.What most likely will happen if the pie maker bakes a seventh pie?

Question illustration
A
The marginal cost will most likely decrease to $1.00
B
The marginal cost will most likely increase to $2.00
C
The marginal revenue will most likely decrease to $8.00.
D
The marginal revenue will most likely increase to $12.00.
14

A monopoly is a market that has

A
few competing businesses.
B
many sellers of the same item.
C
many sellers of a variety of products.
D
a single supplier of a good or service.
15

Motherboards, Inc., manufactures computer parts. The company’s total revenue is

A
the money the company earns after paying all of its production costs.
B
the total wages the company pays workers in its factories and stores.
C
the amount of money the company earns from selling an individual part.
D
the amount the company receives from the sale of all of its computer parts.

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