Economics - Unit 3 Test

Which graph shows the effect on the air travel market in Dallas if a new low-cost airline goes bankrupt?

/->/

Which graph shows the effect on oil markets as a result of anti-government riots in the oil-rich country of Tunisia?

/<-/

How many thousands of boxes of Fruity Munch cereal will be supplied at $5 per box?

3

_____ might lead a business to reduce prices on a certain smartphone because the manufacturer is likely to soon introduce a new model.

Expectations

How much will demand decline if the price rises from $2 to $4 per box?

It will decline from 9,000 to 5,000 boxes per week.

______ profit is the least amount of profit that matches what could be gained by doing something else.

Normal

_____ cost is what is given up when a business decides on a specific action plan.

Opportunity

____ goods are goods that can be used in place of another.

Substitute

At which point does the total product curve reach negative marginal returns?

adding the 6th worker

According to the law of ______, the demand for a product will increase when prices decrease.

demand

measures the amount of a good that consumers are willing and able to purchase at a specific time

demand

The loss of capital to normal wear and tear is the _____.

depreciation

The _____ price is the point where quantity demanded and quantity supplied are equal.

equilibrium

The wages paid to employees are an example of a(n) _____ cost.

explicit

The trend of marginal utility is to increase as consumption increases.

false

As ______ increases, demand for normal goods also increases.

income

Developing a new and improved aircraft is an example of a(n) _____ business decision.

long-term

The additional cost required to produce one more product is ___.

marginal cost

government intervention that typically results in a shortage in the market

price ceiling

government intervention that typically results in a surplus of services and goods

price floor

Dividing the total products produced by the number of workers is the way to compute ______.

productivity

a condition that exists whenever demand exceeds supply

shortage

the amount of a service to consumers that producers are willing and able to provide

supply

the condition present when supply exceeds demand in a market

surplus

The extent to which consumers receive happiness or benefit from a purchase is called ___.

utility