econ mod 2
The company that spent the most money on R&D in 2018 was ______.
Amazon
Utility is an inherently ____________ thing. a) unmeasurable b) measurable
a
A table that shows the quantity supplied at different prices, all things remaining the same, is called a _______________. a) supply chart b) supply schedule c) supply curve d) supply line
b
According to Economics in One Lesson, who mostly bore the risks of fluctuating farm prices at that time? a) consumers b) speculators c) the government d) farmers
b
Demand curves slope __________. a) upward b) downward
b
If the supply curve shifts to the left, it means there has been a ___________ change in supply. a) positive b) negative
b
According to Economics in One Lesson, what will happen if the government sets a minimum price for a product but doesn't restrict its output? a) Consumers won't be able to buy the product due to the shortage that will be created. b) The community will experience a net gain in production. c) Unsold surpluses of the product will pile up until the market collapses. d) The market for that product will become much more stable.
c
According to Hazlitt, what "solves the enormously complicated problem of deciding precisely how much of tens of thousands of different commodities and services should be produced in relation to each other?" a) focusing on production over profits b) government quotas and price-fixing c) the supply-and-demand price system
c
According to the video, during the course of an entire lifetime, the earnings for a bachelor's degree could exceed those for a high school diploma by _________. a) $7,200 b) $72,000 c) $720,000 d) $7,200,000
c
If a lemonade stand generates $100 in total revenue with $50 in total cost, what is its profit? a) $150 b) $100 c) $50 d) $0
c
If a nation has a GDP of $1,000,000 and a population of 1,000, what is its per capita GDP? a) $1,000,000,000 b) $1,000,000 c) $1,000 d) $10,000
c
In order to offset the decreased profit caused by fixing a maximum price, governments sometimes pay subsidies to producers. What situation does this create? a) Producers earn far greater profits than they would have in a supply-and-demand price system. b) Consumers end up paying a price greater than the equilibrium price. c) People in their role of taxpayers end up subsidizing themselves in their role of consumers. d) Bureaucrats are able to ensure that the people with the greatest need get the most help.
c
According to Economics in One Lesson, what is the consequence of limiting the profits of those who make essential commodities, but not limiting the profits of those who make luxuries or semi-luxuries? a) People will have equal access to essentials but not luxuries. b) People will be discouraged from owning luxuries and semi-luxuries. c) The production of luxuries and semi-luxuries is discouraged. d) The production of the price-controlled essential commodities is discouraged.
d
If demand for pancakes increases when the price of waffles increases, that means the two goods are _________. a) opportunities b) scarce c) complements d) substitutes
d
Which of the following would result in an increase in quantity supplied? (choose all that apply) a) the development of strong alternative profit opportunities b) a price decrease c) an increase in the cost of resources used in production d) a price increase
d
Consumer preferences are commonly impacted by new technology, as well as by health and ___________ concerns.
environmental
The one price at which quantity supplied equals quantity demanded is the ___________ price.
equilibrium
Gross domestic product represents the total market value of all ______ goods and services legally produced in the economy in one year.
final
According to Hazlitt, one method the government used to raise crop prices was to give "_________ _____ to farmers to enable them to hold their crops off the market."
government loans
A sustained rise in a nation's real GDP is called economic _______.
growth
Two benefits usually given to full-time employees are retirement plans and ______ insurance.
health
According to Economics in One Lesson, "In an economy in equilibrium, a given industry can expand only ___________." a) at the expense of other industries b) at the expense of efficient producers c) if producers concentrate on production instead of profit d) if goods are sold for their marginal costs of production
a
According to Hazlitt, "Real wages come out of _________, not out of government decrees." a) production b) profits c) capital
a
According to Hazlitt, those who advocate establishing a price floor argue that they're not trying to boost the price but are only trying to _________ it. a) stabilize b) lower c) improve d) fluctuate
a
As an individual, you are most productive when _____________. a) you reach a particular goal with minimum effort or cost b) you spend as much time as possible to reach a particular goal c) you procrastinate and cram a lot of work into a short amount of time d) you multitask, dividing your focus between multiple goals
a
If a video game generates $10,000 in profit on total revenue of $30,000, what was the game's total cost? a) $20,000 b) $10,000 c) $40,000 d) $30,000
a
If the equilibrium price of corn is $4.00, but the government establishes a minimum market price of $5.00, what will happen? a) There will be a surplus of corn. b) There will be a balance of corn. c) There will be a stability of corn. d) There will be a shortage of corn.
a
If the market price for pizza is $10.00, and the equilibrium price is $5.00, there will be a(n) ________ of pizza. a) surplus b) elasticity c) shortage d) complement
a
If the supply curve shifts to the right, it means there has been a _________ change in supply. a) positive b) negative
a
If there is a positive change in demand, what will happen to the equilibrium price? a) It will increase. b) It will decrease. c) It will stay the same.
a
Match each type of incentive with its definition. positive incentive: a) a reward or other enticement that encourages a behavior b) a penalty that discourages a behavior c) external rewards such as wealth, fame, or praise d) internal psychological rewards
a
The goal of all consumers is to ________________. a) maximize utility b) eat the most restaurant meals c) not have a budget constraint
a
What is a dividend? a) a distribution of profits to investors b) profit made from the sale of an investment such as stock or real estate c) the federally guaranteed portion of a savings account d) the amount of profit a corporation earns each year
a
Which of the following is partly determined by costs of production? a) supply b) demand c) price d) elasticity
a
Which type of economy usually increases productivity at a faster rate? a) market economy b) command economy c) traditional economy
a
Hazlitt argues that the best way to raise wages is to raise labor productivity. Which of the following are methods for accomplishing this? (choose all that apply) a) new inventions and improvements b) better education and training c) more efficient management on the part of employers d) decrease in capital accumulation
a b c
Which of the following would cause a negative change in supply for corn? (choose all that apply) a) an increase in the cost of tractors used in corn fields b) an expectation among producers that corn won't be very profitable in the near future c) the development of new irrigation techniques that increase the amount of corn that can be grown per acre d) a decrease in the price of corn e) a decrease in the number of corn sellers
a b e
If there is a positive change in supply, which of the following will happen? (choose all that apply) a) The supply curve will shift to the right. b) The supply curve will shift to the left. c) The equilibrium price will decrease. d) The equilibrium price will increase.
a c
What two outcomes are possible when production costs fall? (choose all that apply) a) The company's profits increase. b) The company's profits decrease. c) The company sues the government. d) The company lowers their prices.
a d
Which of the following are controls used by governments to try to offset the negative effects of setting a maximum price? (choose all that apply) a) rationing b) price calibration c) supply-side economics d) subsidies e) cost-control f) universal price-fixing
a d e f
According to the lesson, why is raspberry soda much harder to find than cherry soda? a) Raspberry flavoring is more expensive than cherry flavoring. b) As a whole, consumers are more likely to buy cherry soda than raspberry soda. c) The CEOs of PepsiCo and Coca Cola don't like the taste of raspberry soda. d) The technology required to make raspberry soda doesn't exist.
b
Change in quantity demanded can reflect changes in which of the following variables? (choose all that apply) a) consumer preferences b) price c) consumers' incomes d) technology
b
Consumers can discourage production of a particular product by casting their ______ votes elsewhere. a) production b) dollar c) primary d) congressional
b
How much of the total national income of the United States is made up of corporate profits? a) 60.6% b) 6.6% c) 36.6% d) 16.6%
b
If Charlie's Cherry soda generates $50,000 in profit on $200,000 in total revenue, what is the company's total cost? a) $250,000 b) $150,000 c) $50,000
b
If a nation has a real GDP of $10,000,000 and a population of 50,000, what is its per capita GDP? a) $20 b) $200 c) $2,000 d) $20,000
b
If demand for milk goes down 2 percent when the price goes up 10 percent, we would say that demand for milk is __________. a) elastic b) inelastic
b
If demand for potato chips decreases when the price of salsa increases, that means the two goods are ________. a) scarce b) complements c) opportunities d) substitutes
b
If demand for video games rises when consumers' incomes increase, that means that video games are a(n) ________ good. a) inferior b) normal c) poor d) luxury
b
If the cost of steel used to produce automobiles increases, what will happen to the quantity supplied of automobiles, assuming the price that consumers pay for automobiles stays the same? a) increase in quantity supplied b) decrease in quantity supplied c) no change in quantity supplied
b
If the price of pizza increases, then what will happen to demand for pizza, if all other things remain unchanged? a) Demand will increase. b) Demand will decrease. c) Demand will stay the same.
b
If there is no profit in making a product, it's a sign of what? a) The production costs for the product are too low. b) The labor and capital devoted to its production are misdirected. c) Producers are too pessimistic about the product's success. d) The product needs to be supported by a government price floor.
b
In a market economy, who is primarily responsible for deciding what goods and services will be produced? a) producers b) consumers c) investors d) workers
b
Market economies generally increase productivity at a higher rate than command economies because they offer more __________ to innovators. a) price floors b) incentives c) consumers d) tariffs
b
Match each type of incentive with its definition. negative incentive: a) a reward or other enticement that encourages a behavior b) a penalty that discourages a behavior c) external rewards such as wealth, fame, or praise d) internal psychological rewards
b
Rent control is an example of a ______________. a) price floor b) price ceiling
b
What is the graphical representation of a supply schedule called? a) supply pie b) supply curve c) supply chart d) supply graph
b
What percentage of American jobs are currently at risk of being automated in the next fifteen years? a) 10 to 20 percent b) 30 to 40 percent c) 50 to 60 percent d) 70 to 80 percent
b
When a negative change in demand occurs, the demand curve will shift to the ______. a) right b) left
b
Which of the following is a common way productivity is measured? a) the letter grade produced per test b) the number of units produced per hour of labor c) the subdivision of labor produced per output d) the number of entrepreneurs produced per investment
b
According to Economics in One Lesson, which of the following are "essential for the health of a dynamic economy"? (choose all that apply) a) Growing industries should be regulated so they don't cause the death of other industries. b) Dying industries should be allowed to die. c) Growing industries should be allowed to grow. d) Dying industries should be kept alive even if they're unprofitable.
b c
According to Hazlitt, which of the following are functions of profit? (choose all that apply) a) to ensure that all producers are able to stay in business b) to put constant pressure on businesses to become more efficient c) to guide and channel the factors of production d) to create a powerful upper class of business elites
b c
Which of the following would result in a higher equilibrium price for pizza? Assume that pizza is a normal good. (choose all that apply) a) an increase in the number of pizza restaurants b) an increase in the price of burgers c) an increase in the price of pizza dough d) an increase in the number of consumers in the area
b c d
Which of the following is true about the supply-and-demand price system? (choose all that apply) a) The amount that a commodity cost to produce in the past determines its current value. b) It solves the problem of alternative applications of labor and capital. c) It creates scarcity. d) It drives the least efficient producers out of business.
b d
A restriction on total spending is called a _________ constraint. a) credit b) monetary c) budget d) debt
c
Consumers tell producers which goods and services they should keep making by casting ________ votes. a) production b) political c) dollar
c
During World War II, the American government established a rationing system to counteract the shortages caused by fixing maximum prices. Why is rationing only partly effective in counteracting these shortages? a) It doesn't factor in opportunity costs. b) It only works for certain classes of society. c) It only limits the demand without also stimulating the supply. d) It doesn't take into account marginal benefit for consumers.
c
If the equilibrium price of corn is $4.00, and the government sets a price ceiling of $3.00, what will happen? a) There will be a balance of corn. b) There will be a stability of corn. c) There will be a shortage of corn. d) There will be a surplus of corn.
c
Match each type of incentive with its definition. extrinsic incentive: a) a reward or other enticement that encourages a behavior b) a penalty that discourages a behavior c) external rewards such as wealth, fame, or praise d) internal psychological rewards
c
One of the biggest incentives for consumers is a low ______. a) value b) return c) price d) convenience
c
Private individuals who develop new products and technologies can protect their invention by filing for a(n) ______. a) trademark b) copyright c) patent d) exemption
c
The price of a good or service when it's sold in the market is called the __________. a) sale price b) equilibrium price c) market price d) service price
c
What are activities designed to create innovative new products or improve existing products? a) efficiency management b) capital improvement c) research and development d) technological science
c
What two choices does a company have when production costs rise? (choose all that apply) a) The company can sue the government. b) The company can decrease their prices. c) The company can increase their prices. d) The company can accept lower profits.
c d
Which of the following would result in a lower equilibrium price for milk? Assume that milk is a normal good. (choose all that apply) a) a decrease in the number of milk producers b) a decrease in the price of cereal c) a decrease in consumer preference for drinking milk d) a decrease in consumers' incomes
c d
Profit made from the sale of an investment such as stock or real estate is a _______ ____.
capital gain
A shift in the supply curve caused by a change in the determinants of supply is called _______. a) change in quantity supplied b) change in supply schedule c) change in net supply d) change in supply
d
If the market price for Super Bowl tickets is $2,000, and the equilibrium price is $3,000, there will be a(n) ________ of Super Bowl tickets. a) complement b) surplus c) elasticity d) shortage
d
If the price of milk increases, then what will happen to demand for milk, if all other things remain the same? a) Demand will increase. b) Demand will create supply. c) Demand will stay the same. d) Demand will decrease.
d
Illegal goods such as fake handbags or illegal drugs are sold on the _________ market. a) red b) labor c) stock d) black
d
In this market, the "sellers" are the workers looking to sell their time and skills in return for wages, while the "buyers" are the businesses looking to hire these workers. a) black market b) employee market c) stock market d) labor market
d
Increased productivity helps businesses make greater profits, but it also helps consumers by __________________. a) allowing them to buy goods and services on credit b) reducing the impact of inflation on wage growth c) giving them access to more training and education d) giving them access to cheaper goods and services
d
Match each type of incentive with its definition. intrinsic incentive: a) a reward or other enticement that encourages a behavior b) a penalty that discourages a behavior c) external rewards such as wealth, fame, or praise d) internal psychological rewards
d
Physical capital is another name for _____________. a) exercise b) labor c) healthy living d) capital resources
d
Which entrepreneur revolutionized the automobile industry by introducing the moving assembly line? a) Adam Smith b) Karl Benz c) Soichiro Honda d) Henry Ford
d
In a competitive market economy, the ____________ producers are driven out of business by a fall in price.
inefficient
If demand for canned beans rises when consumers' income decreases, that means that canned beans are a(n) ___________ good.
inferior
___ ______ GDP is calculated by dividing a nation's real GDP by its population and represents each person's share of the nation's production if it were divided equally among its citizens.
per capita
The degree to which buyers and sellers respond to price changes is called ________.
price elasticity
The income generated by the sale of goods and services is called ________.
revenue
The real cause of rising prices is a ________ of goods or a surplus of money.
scarcity
When the equilibrium price is above the market price, it results in a ___________.
shortage
In Chapter 15, Hazlitt writes, "Everything, in short, is produced at the expense of forgoing __________ _____."
something else
If demand for PlayStation consoles increases when the price of Xbox consoles increases, that means the two goods are ____________.
substitutes
Oil prices collapsed in 2014 for two main reasons: an increase in _________ and a decrease in demand.
supply
When the market price is above the equilibrium price, it results in a ___________.
surplus
Hazlitt argues that in situations where workers are being paid below their market worth, the situation should be remedied not by a minimum wage, but instead by __________.
unionization
From left to right, supply curve always slope __________ while demand curves slope __________.
upward; downward
The satisfaction consumers get from goods and services is known as _________.
utility
Supply is the ability and the ____________ to produce and sell specific quantities of a good or service at different prices in a specific time period, all things remaining the same.
willingness
