Plato Economics

These graphs represent the price and output quantities of purses under perfect competition and monopoly. How much more or less will Jackie pay for a purse in a perfect competition than in a monopoly?

$20 less https://i.imgur.com/nUC4JB2.png

Identify if the following are Discretionary spending or Mandatory spending. 1) The federal government purchases new defense equipment 2) Gloria is a 70 year old retired woman. She pays her expenses with the income she receives from the government. 3) Nick receives a weekly amount from the government because he became unemployed when his company cut costs by laying off employees. 4) The federal government funds a new research project. 5) The government is planning to build more highways. 6) Jill receives inpatient hospital services even though she cannot afford them.

1) Discretionary Spending 2) Mandatory Spending 3) Mandatory Spending 4) Discretionary Spending 5) Discretionary Spending 6) Mandatory Spending

Match each situation with the agency or act that would address it. 1) Casey applied for a home loan, but the bank rejected her application because it found some problems in her credit report. She wants to know what those problems are. 2) Shoppers discover that the breakfast cereal they bought is contaminated. 3) John is pestered by marketers who keep sending him messages on his phone trying to sell him products.

1) Fair Credit Reporting Act 2) Food and Drug Administration 3) Federal Communications Commission

Match each agency with its purpose. 1)inspection and approval of food products 2)regulation of pollution and conservation of energy 3)protection and safety of workers

1) Food and Drug Administration 2) Environmental Protection Agency 3) Occupational Health and Safety Organization

Identify whether each acquisition is allowable under eminent domain. Label them Yes or No if they are allowable under Eminent Domain. 1) The local government wants to purchase the Connolly family's farmland to build a car showroom. 2) The state government plans to purchase a local school building to build a radio tower. 3) The federal government plans to take over Mr. Cooper's unused plot of land without any compensation to build a stadium. 4)The state government plans to purchase a few occupied houses on behalf of a multinational corporation that wants to develop the land into a public park.

1) No 2) Yes 3) No 4) Yes

Mach each scenario with the government agency it involves 1) Dwayne's company has clearly marked each container to indicate what chemical it contains and the threat it poses. 2)Ryan's new car is certified to meet federal emission standards. 3)Lisa finds that her favorite brand of yogurt has been taken off the shelf after the company ordered a recall.

1) Occupation Health and Safety Organization 2) Environmental Protection Agency 3) Food and Drug Administration.

Identify the type of money used for each transaction. 1) Karen bought a bike by exchanging it for her silver reciept. 2) Luke paid six apples for two dozen eggs. 3) Chris bought a bagel with coins issued by the government.

1) Representative money 2) Commodity money 3) Fiat money

Match each situation with the method of government intervention used to rectify it. 1) People have too much money, and there is a danger of inflation 2) The GDP has fallen to an all time low and there is low demand for most goods. 3) Few farmers produce cotton because profits are at equilibrium price. 4) Prices of staple foods have shot up because of shortages after an earthquake.

1) contradictory fiscal policy 2) expansionary fiscal policy 3) price floor 4) price ceiling

Match each economist to the scenario that exemplifies his economic philosophy. 1) A small Caribbean island's economy depends on tourism. However, in recent times, it has seen much less economic activity. Its government decides to let the market correct the situation. 2) Flour prices have risen in a country where bread is a staple part of the diet. As a result, bread prices have risen tremendously, in an effort to make bread affordable for its citizens, the government has limited how much bakes can charge for bread.

1)Hayek 2)Keynes

Arange the economic systems from least to most government involvement.

1)Market Economy 2)Mixed Economy 3)Socialist Economy 4)Communist Economy

The government of a country increased the minimum wage from $21 to $30. A factory owner had to lay off some of his workers because he could not afford to pay all of them. How many people lost their jobs?

8 workers lost their job. See screenshot.

How many workers would producers be willing to employ at a wage of $40 per hour?

8 workers. see screenshot

Which statements are true according to the law of supply?

A decrease in price leads to a decrease in supply. An increase in price leads to an increase in supply.

The table shows the federal government's budgeted revenue and expenditures from 2001 through 2010. Identify the years in which there was a budget deficit.

A deficit is when the revenue is less than the expenditure.

NOT SOLVED! Which of the following are non-price determinants of supply?

A) new producers entering the market B) government taxes and subsidies C) effect of mass media advertising D) cost of the product or services E) future expectation of prices

A small community uses cattle as money. A man from the community traded five cows for a plot of farmland. Which characteristic of his money allowed him to make this transaction?

Acceptability

According to ______, self-interest and competition act as an ________, guiding firms in a market-based economy.

Adam Smith, invisible hand

The North America Free-Trade ______ is an agreement among North American countries. The US government benefits from this agreement because it expands the market for American _____ by giving American ______ easy access to North American markets.

Agreement, products, exporters

Henry lives in a country where the government gives many incentives to produce military goods and few incentives to produce consumer goods. Henry knows a more efficient way to finish his task at work and feels like sharing it with his boss. However, he has no incentive to share it. Which type of economy does Henry most likely live in?

Command Economy.

Mario paid three bushels of rice for three boxes of wool at the market. What type of money did Mario use for this exchange?

Commodity

People who want to obtain _____ from financial institutions can use their _____ rights to do so

Credit, Property

What is dumping?

Dumping is exporting goods at prices that are lower than their value.

Which trade agreement or union does not include the United States?

EU

Classify each action as contractionary or expansionary monetary policy.

Expansionary - Reducing federal funds rate, reducing the required reserve ratio. Contractionary - Selling government securities, increasing the discount rate.

Susan is afraid that someone stole her identity using the details she provided for an online credit card application. Which agency can she complain to?

Federal Trade Commission

What allows consumers to receive goods and services in a non-price rationing system?

First come first serve.

The economy of country Y has experienced increased unemployment and reduced GDP for six months. The government therefore decides to implement fiscal policy that increases _____ and reduces ______.

Government spending, Taxes

All of a country's citizens pay the ______ an income tax that is 7% of their annual earnings. This tax is a(n) _______ tax.

Government, A proportional

Economic stability is a situation in which the economy experiences constant ____ and low _____.

Growth, Inflation

Why was Friedrich von Hayek against government intervention in an economy?

He believed It would reduce economic freedom.

Which basic economic question determines how a society will produce goods and services?

How can available resources be used efficiently?

A survey conducted recently in China showed that in the last two years, investments in businesses increased by almost 75%. The same survey also concluded that people became wealthy by investing in businesses, and this motivated other people to invest more in their respective businesses. What most likely triggered this increase in investment?

Incentives

The economy of a country has shown signs of overheating, such as high inflation rates. The government decides to implement fiscal policy. Which action should it take to achieve the nation's economic goals?

Increase taxes

The price of mangoes is currently $5.00 per pound. At this price, producers are supplying 4,000 pounds of mangoes. Point C on the graph shows the current equilibrium price and quantity. To which point will the equilibrium shift if the demand increases suddenly because of a non-price determinant of demand?

It will shift to point B since...see screenshot

Mark wants to sell his condo. Jack and Nick are two prospective buyers. Jack is willing to pay the amount quoted by Mark, while Nick is unable to pay such a high price for the condo. Because Jack is able to pay the asking price, Mark sells his condo to Jack. In which type of economy does this transaction take place?

Market economy

What type of economy is an economic system in which private businesses can operate freely with minimal state control?

Market economy

In a certain country, private enterprises provide various goods and services. But the government provides free public transportation and electricity to its citizens. Which type of economy exists in this country?

Mixed Economy

Which market structure has a single company or seller in a market with many barriers to entry?

Monopoly

Jack, Jamie, Ronnie, and Stephan own the only computer software manufacturing companies in the country. When Jack increases the price of his product and advertises extensively to promote it, the other three manufacturers immediately increase their prices and launch promotional strategies. What type of market structure do these four companies operate in?

Oligopoly

A communist country decides to give its people more economic freedom in an attempt to improve its failing economy. What outcome is the government most likely worried about in this case?

People will want more political freedom.

Which point on the graph indicates the lowest quantity supplied of goods?

Point A which is the lowest point on the supply line.

This graph shows the demand and supply of a particular brand of shampoo in the market. Which point on the graph indicates a surplus production of shampoo?

Point D which is the highest point on the supply line.

Which point on the demand curve represents the highest quantity demanded?

Point D which is the lowest point on the demand line.

Which term is defined as the maximum legal price for a good or service?

Price ceiling

John owns an apple orchard and makes a living by selling apples. He protects his land with utmost care and takes all the necessary security measures. What motivates John to protect his land?

Property Rights.

Jack has to pay _______ tax to the government for his house. This type of tax is _______ tax.

Property, a direct

Reserve Banks are _______ that help the ______ carry out its duties.

Regional Banks, Central Bank

With a _____ tax, the tax rate decreases as income increases. _______ individuals bear a greater burden with this type of tax.

Regressive, lower-income

Mark is an excellent cook. He does not have any formal training but learned to cook by following the recipes of several famous chefs and his mom. Every weekend, he invites friends over for dinner so he can try new dishes and get honest feedback from his friends. Mark wants to start his own restaurant someday because he thinks he would be successful and become wealthy. Which of Adam Smith's ideas made Mark think of starting a restaurant?

Self interest

Select the statement that indicates retaliatory protectionism.

Soon after, nation Y increased tariffs on imports of precious metals from country X.

Which type of unemployment is defined as people losing their jobs because their skill is no longer in demand?

Structural

Who makes decisions regarding changes in the discount rate?

The Board of Governors

Which factor determines who a society will produce goods and services for?

The Economic system in society.

Some of the money that people deposit into a bank eventually becomes an injection into the economy when

The bank makes loans

Which statement about progressive taxes is true?

The rate increases as income increases.

How does the rate of a proportional tax change with income?

The rate remains the same, even if income increases or decreases.

Select the statement that shows how Alvaria, a fictional country, practices protectionism.

Traders pay a 25% tariff on Colandian beef imported into Alvaria.

Jamie took a school trip to Africa to study the economy. In one village, he saw that the people performed only unskilled activities such as hunting and fishing. Also, they did not use money to acquire goods. Instead, they simply exchanged goods with each other. What type of economy does this village have?

Traditional Economy

Which government agency is responsible for protecting the nation's transportation systems to ensure freedom of movement for passengers and commerce?

Transportation Security Administration

If a society decides to produce consumer goods from its available resources, it is answering the basic economic question.

What to produce.

When does a natural monopoly arise?

When economies of scale occur over a relevant range of output

Cassandra is 80 years old. Last month, she broke her leg while biking with her grandchildren. She was admitted to a hospital for surgery. Which card should she show them to get benefits?

a Medicare insurance card

The table shows the federal government's budgeted revenue and expenditures from 2001 through 2010. Identify the years in which there was a budget surplus.

a surplus is when the revenue is greater than the expenditure.

Which phrase defines a demand schedule?

a table showing the quantity demanded for a good at different prices

What is a free trade agreement?

an agreement that removes trade barriers, such as import tariffs and quotas

Which phrase describes the substitution effect?

buying cheaper alternatives when a product becomes expensive.

Which of the following are characteristics of an economic union?

common trade regulations free movement of capital and labor free movement of goods

Which factors decrease because of protectionism?

competition goodwill with trade partners importation of goods

Which phrase defines complementary goods?

goods used in combination with other products

John is a producer in a perfectly competitive market structure. Identify the point where he will set his output.

https://i.imgur.com/FNGj1cw.png

Indicate the point where a monopoly will set its output.

https://i.imgur.com/dKz6w7C.png

Identify whether each scenario describes a drawback or an advantage of trade regulation.

https://i.imgur.com/jXgUHUJ.png

Which of the following scenarios would the National Highway Traffic Safety Administration be involved in?

investigating the use of a faulty gearbox in a semitrailer modifying the fuel efficiency standards for new cars

Which of the following is a characteristic of money?

limited supply

In a perfect competition, there are ________ buyers and sellers of _________ products, and there is ________ entry and exit in the market.

many, homogeneous, free

Which market structure predominantly uses product differentiation to attract consumers?

monopolistic competition

Companies under _________ market structures are interdependent. ________ is a secret agreement among companies that may result from this interdependence.

oligopolistic, Collusion

Glen found three brands of earbuds that have the specifications he wants. The three pairs of earbuds looked a bit different from each other, but Glen knew they would perform similarly. Still, each company offered its earbuds at a different price. What economic concept does this situation represent?

product differentiation

The GDP of a country hasn't improved in the past three years. The central bank decided to take a measure that will increase the amount of money people spend on goods and services. Which step should the central bank take?

reduce interest rates.

Which term is defined as the government setting the maximum amount that a property owner can charge a tenant?

rent control

During wartime, a small country issued certificates to the public to raise money. Each certificate promised to pay the holder a certain amount in silver. After the war was over, the population continued exchanging these certificates instead of converting them to silver. What type of money did this economy use?

representative

Which tax is an indirect tax?

sales tax

Which phrase describes the income effect?

the impact of price on consumers' purchasing ability and decisions

What is the federal funds rate?

the interest rate that banks charge each other for overnight loans

What is eminent domain?

the right of a state or national government to make public use of a private property.

What is the purpose of the Sherman Antitrust Act?

to break up monopolies in the market

Ally just bought a plane ticket. She notices that the fare includes a September 11 Security Fee. What is the government's purpose for imposing this fee?

to pay for security at airports

How many bushels of wheat are wholesalers willing to buy at $18 per bushel?

wholesalers are willing to buy 42 thousand bushels. see screenshot