Final Exam Questions Economics with correct answers 2024

Economics is about - answer-Choice people make to satisfy their needs and wants Food, clothing, and shelter are examples of human - answer-need A resource is - answer-materials that are needed by a producer to make a good or service the buildings, structures, machinery, and tools used in the production process are called - answer-capital resources an entrepreneur is a - answer-person who is willingly risk failure to start a new business or introduce a new product The basic fact of economic life is - answer-scarcity You are in the clothing store. You see a pair of pants and a T-shirt that you like. However, you have only enough money for one item of clothing. You decide to buy the pants. What is the opportunity cost of your choice? - answer-first item over the second item an accepted medium of exchange is known as - answer-money the term that means a consumer can use an item before they have completely paid for it is - answer-credit in truth, all economies today are - answer-mixed economies in which economic system are the answers to the basic economic questions determined by custom - answer-traditional system the economic system in which the basic economic questions are answered by government planners are called a - answer-command planned system economic system be individuals answer the basic economic questions - answer-market system according to Adam Smith, the invisible hand that helps guide the economy is - answer-self-interest acts, free market ownership of private property is a characteristic of - answer-free enterprise, mixed market economy making the best use of scarce resources is called economic - answer-efficiency the two concerns of the goal of economic stability are - answer-full employment and stable prices in economics, the amount of a product a consumer is willing and able to buy at various possible prices during a given time is called - answer-demand the tendency of consumers to replace a relatively more expensive product with a similar, lowered price product is called - answer-substitution effect satisfaction a consumer receives from consuming a product is - answer-utility if the price of butter Rises, what will happen to the demand for substitute Goods, such as margarine? - answer-will rise, increase construction of new houses increases. What will happen to demand for such complementary Goods as Timber, paint, and paint brushes? - answer-increase when the price of a good or service is too low, the result will be - answer-shortage when the price of a good or service is too high, the result will be - answer-Surplus receiving less satisfaction from a good as you consume more of it is called - answer-diminishing marginal utility after producers have paid all their cost amount of money remaining is - answer-profit if a good can be made quickly, and expensively, and using a few, readily available resources it has - answer-elastic Supply if producing a good takes great deal of time, money, and resources that are not readily available, that good has - answer-inelastic Supply the three stages of production that can be predicted by the law of diminishing returns are increasing returns, diminishing returns and - answer-negative returns the production cost that do not change with the level of output are called - answer-fixed cost the production costs that change as the level of output changes are called - answer-variable cost the sum of the fixed and variable production cost is a company's - answer-total cost production costs that don't change as the level of output changes are called - answer-fixed cost the additional cost of producing one more unit of output - answer-marginal cost what situation exists when quantity supplied and quantity demanded for a product are equal at the same price? - answer-equilibrium price when a surplus exists in a market, prices - answer-decreased a government regulation that sets a maximum price for a particular good is called - answer-price ceiling a government regulation that sets a minimum level for prices is called a - answer-price floor overtime, a price ceiling may cause - answer-shortage overtime, a price floor may cause - answer-Surplus the system in which a government or other institution decides how to distribute a good or service is called - answer-rationing the place where goods are exchanged illegally at prices that are higher than officially established prices is called a - answer-Black Market under perfect competition, products must be - answer-same, identical one key difference between perfect competition and monopolistic competition is that - answer-sellers offer different rather than identical products which of the following is a market structure dominated by a few large sellers - answer-oligopoly a market is considered an oligopoly if the largest three or four sellers produce - answer-identical or similar products When sellers secretly agree to set production levels or prices, it is called - answer-collusion what kind of monopoly often provides basic necessities, such as public utilities? - answer-natural, government most common type of business organization in the United States is - answer-sole proprietorship the disadvantages of sole proprietorship include lack of longevity, sole responsibility, limited growth potential, and - answer-zoning laws In what business organization do two or more people enjoy equal decision-making authority? - answer-partnership what type of business has limited liability? - answer-corporation two disadvantages that sole proprietorship and partnerships share are lack of longevity and - answer-unlimited liability the business structure allows a large business to be treated as a single person is the - answer-corporations the most common way that corporations raise money is by - answer-selling stock which form of business organization does not focus on financial gain for it's members? - answer-non profit organization for many people, the most important factor in choosing a job is - answer-wages employers are required to pay the same wages to male and female employees who do the same job by the - answer-equal pay act of 1963 the situation in which workers cannot be hired unless they are union members is called a - answer-closed shop a union composed of mainly skilled workers is called - answer-craft Union a union composed of mainly unskilled workers is called - answer-industrial Union a part of a labor contract that automatically raises wages to match widespread price increases is the - answer-seniority if contract negotiations fail, the Union might - answer-strike a refusal to buy the products of any firm that does business with a company whose employees are on strike is called a - answer-secondary boycott the payment that financial institutions receive in return for making loans is called - answer-interest an income stock provides - answer-consistent dividends to investors a growth stock provides - answer-order to increase value of their assets the difference between the higher selling price of a stock and a lower original purchase price is the investors - answer-capital gain stock from a company that is well-known, stable and with good long-term prospects is called - answer-corporate finances which phase of the business cycle comes after contraction - answer-trough which phase of the business cycle is characterized by economic growth - answer-expansion which phase of the business cycle is characterized by a Slowdown in business - answer-contraction full employment means - answer-unemployment rate is 5% or less a person who leaves a job to look for a better one is example of - answer-frictional employment when jobs are permanently lost it is known as - answer-termination the general rise in prices that takes place over time is known as - answer-inflation 77 to 80 - answer-Do tomorrow or guess a flat rate tax is also called a - answer-proportional tax a tax that takes a larger percentage of income from a high-income person then from a low-income person is a - answer-progressive tax the federal individual income tax for the most part is a - answer-proportional tax because it falls more heavily on people in lower income groups, the sales tax is a - answer-regressive tax which of tax do most local governments rely on for tax revenues - answer-property taxes pay tax on a particular good or service is called a - answer-sales tax to help reduce inflation, Congress might - answer-reduce government spending or lower taxes tax on imported good is called - answer-custom tax a tax on the assets of a person who has died is called - answer-estate tax when a nation can produce a certain good with greater efficiency than a can a trading partner, that nation has a - answer-absolute advantage the difference between a nation's imports and exports is known as its - answer-balance of trade revenue tariffs are designed to - answer-raise money for output a law that cuts off imports from and exports to a particular country is called - answer-embargo which type of trade barrier is inactive just for political reasons - answer-embargo the term that means a country agrees to limit its exports to another country is known as - answer-voluntary trade restriction