IUPUI BUS-x100 Prep Exam 1 Questions
And All Solved Answers.
An economic system in which individuals and businesses make the decisions about what to produce and
what to buy, and the market determines how much is sold and at what prices is called a _________
economy.
A. product
B. producer's
C. command
D. market
E. planned - Answer Market
The market price of peaches is currently falling. In a free-market economy, the most likely explanation of
this price change is that:
A. the government has decided to set a lower price because sellers have been price gouging.
B. there is a surplus in the market for peaches.
C. the supply of money has increased.
D. the equilibrium price is higher than the market price.
E. there is a shortage of peaches in the market. - Answer there is a surplus in the market for peaches
"Monopolistic competition" differs from pure competition because it can be characterized by
A. many buyers and few sellers.
B. few buyers and many sellers.
C. product differentiation.
D. a few companies that control the market.
E. few buyers and few sellers. - Answer product differentiation
Which of the following is NOT a feature of the U.S. "Free Enterprise" system?
A. Competition
, B. Guaranteed income
C. Private ownership of property
D. Limited role of government
E. Profit motive - Answer guaranteed income
_______________ is a necessary and extremely important by-product of the U.S. "Free Enterprise"
system.
A. Monopoly
B. Competition
C. Communism
D. Socialism
E. Poverty - Answer competition
Because it controls the world's diamond deposits, the DeBeers Consolidated Mines, Ltd. has a(n)
A. comparative advantage.
B. advantage based on efficient production.
C. absolute advantage.
D. trade deficit.
E. trade surplus. - Answer absolute advantage
In a capitalist economy, the question of what to produce is answered by _________, and the question of
how to produce is answered by _________.
A. consumers; producers
B. consumers; government
C. producers; government
D. consumers; consumers
E. producers; producers - Answer consumers; producers
By definition, nations engage in international trade because every country has a(n) _________ advantage
in some product or service.
And All Solved Answers.
An economic system in which individuals and businesses make the decisions about what to produce and
what to buy, and the market determines how much is sold and at what prices is called a _________
economy.
A. product
B. producer's
C. command
D. market
E. planned - Answer Market
The market price of peaches is currently falling. In a free-market economy, the most likely explanation of
this price change is that:
A. the government has decided to set a lower price because sellers have been price gouging.
B. there is a surplus in the market for peaches.
C. the supply of money has increased.
D. the equilibrium price is higher than the market price.
E. there is a shortage of peaches in the market. - Answer there is a surplus in the market for peaches
"Monopolistic competition" differs from pure competition because it can be characterized by
A. many buyers and few sellers.
B. few buyers and many sellers.
C. product differentiation.
D. a few companies that control the market.
E. few buyers and few sellers. - Answer product differentiation
Which of the following is NOT a feature of the U.S. "Free Enterprise" system?
A. Competition
, B. Guaranteed income
C. Private ownership of property
D. Limited role of government
E. Profit motive - Answer guaranteed income
_______________ is a necessary and extremely important by-product of the U.S. "Free Enterprise"
system.
A. Monopoly
B. Competition
C. Communism
D. Socialism
E. Poverty - Answer competition
Because it controls the world's diamond deposits, the DeBeers Consolidated Mines, Ltd. has a(n)
A. comparative advantage.
B. advantage based on efficient production.
C. absolute advantage.
D. trade deficit.
E. trade surplus. - Answer absolute advantage
In a capitalist economy, the question of what to produce is answered by _________, and the question of
how to produce is answered by _________.
A. consumers; producers
B. consumers; government
C. producers; government
D. consumers; consumers
E. producers; producers - Answer consumers; producers
By definition, nations engage in international trade because every country has a(n) _________ advantage
in some product or service.
