PRINCIPLES OF ECONOMICS - D089 | WGU
STUDY GUIDE | QUESTIONS AND ANSWERS
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Updated Questions and Answers | 100% Verified Exam Prep
,Hidden Unemployment (Discouraged Workers) This type of unemployment includes people who are underemployed, in part-time jobs,
or discouraged.
A newspaper is trying to help citizens understand economic Increasing the money supply raises the standard of living for consumers in the long run
principles. Which misconception should the article address?
3 multiple choice options
A local government is making public policy decisions about What to produce
spending funds. The residents have differing opinions on
3 multiple choice options
whether the funds should be used for road repair, school
expansion, health care increases, or construction of a senior
center. The local government must decide the priority.
Which scenario covers a topic included in microeconomics? As a result of a hard freeze, the price of cherries increases.
3 multiple choice options
Circular Flow Model What shows the flow of payments between households and firms?
It can be in the form of intellectual discoveries. What accurately characterizes capital?
To describe the interaction of businesses and households in Why is the circular flow model used?
markets.
To produce more of one good, the economy gives up more What is a result of increasing opportunity costs?
and more of other goods.
As a constant slope, downward from left to right. How would a PPF be drawn for an economy that produces two goods with homogenous
resources?
The resources of the company are being inefficiently utilized. A company is operating at a point inside its PPF. What conclusion is accurate about this
company?
If production of Good A increases, then production of Good B A country produces two goods (A and B) and currently operates on the bowed out PPF.
will decrease. What is the relationship between the productions of Good A and Good B?
, Changes in income will shift the demand curve, and changes What accurately characterizes demand?
in the market price of the good will result in a movement
along the curve.
A fall in price will likely increase the quantity demanded. What is true about the law of demand?
Demand Schedule What is the name of a table depicting the relationship between the prices of a product
and the quantities that consumers are willing to buy at those prices?
Consumers will decrease hot cocoa purchases both to make What outcome is expected regarding the hot cocoa industry when the cost of cocoa
at home or while out. from South America increases in price, making it more expensive to U.S. businesses?
A shift to the right due to an increase in demand in When a resident heard of an expected tornado, the individual ran to the store to stock up
expectation of a shortage. on survival items including bread, peanut butter, batteries, and water. What is likely to
occur on the demand graph in response to this situation?
Consumers are willing to pay higher prices, and firms will seek Why do markets with excess demand move toward equilibrium?
higher profits.
They reduce supply, causing prices to rise. What describes how higher input costs affect equilibrium in the market for a good?
26.6% decrease The market price of a product increased by 7%. The absolute value of the price elasticity
of demand for this product is 3.8. What is the percent of change in quantity demanded?
Unit Elastic The average price of eggs increases from $1.10 to $1.30. In response, the quantity
supplied increases from 220 to 260 eggs. The elasticity of supply is equal to 1. What term
describes the price elasticity of this supply?
Perfect Competition What type of market is characterized by firms with no market power for any individual
firm?
Firms choose how much to produce. How do firms in a perfectly competitive market max profits when facing perfectly elastic
demand for their products?
Firms will experience zero long-run economic profits. What is an outcome of a perfectly competitive market?
STUDY GUIDE | QUESTIONS AND ANSWERS
| EXAM PREP | GRADED A+ |
GUARANTEED SUCCESS
Updated Questions and Answers | 100% Verified Exam Prep
,Hidden Unemployment (Discouraged Workers) This type of unemployment includes people who are underemployed, in part-time jobs,
or discouraged.
A newspaper is trying to help citizens understand economic Increasing the money supply raises the standard of living for consumers in the long run
principles. Which misconception should the article address?
3 multiple choice options
A local government is making public policy decisions about What to produce
spending funds. The residents have differing opinions on
3 multiple choice options
whether the funds should be used for road repair, school
expansion, health care increases, or construction of a senior
center. The local government must decide the priority.
Which scenario covers a topic included in microeconomics? As a result of a hard freeze, the price of cherries increases.
3 multiple choice options
Circular Flow Model What shows the flow of payments between households and firms?
It can be in the form of intellectual discoveries. What accurately characterizes capital?
To describe the interaction of businesses and households in Why is the circular flow model used?
markets.
To produce more of one good, the economy gives up more What is a result of increasing opportunity costs?
and more of other goods.
As a constant slope, downward from left to right. How would a PPF be drawn for an economy that produces two goods with homogenous
resources?
The resources of the company are being inefficiently utilized. A company is operating at a point inside its PPF. What conclusion is accurate about this
company?
If production of Good A increases, then production of Good B A country produces two goods (A and B) and currently operates on the bowed out PPF.
will decrease. What is the relationship between the productions of Good A and Good B?
, Changes in income will shift the demand curve, and changes What accurately characterizes demand?
in the market price of the good will result in a movement
along the curve.
A fall in price will likely increase the quantity demanded. What is true about the law of demand?
Demand Schedule What is the name of a table depicting the relationship between the prices of a product
and the quantities that consumers are willing to buy at those prices?
Consumers will decrease hot cocoa purchases both to make What outcome is expected regarding the hot cocoa industry when the cost of cocoa
at home or while out. from South America increases in price, making it more expensive to U.S. businesses?
A shift to the right due to an increase in demand in When a resident heard of an expected tornado, the individual ran to the store to stock up
expectation of a shortage. on survival items including bread, peanut butter, batteries, and water. What is likely to
occur on the demand graph in response to this situation?
Consumers are willing to pay higher prices, and firms will seek Why do markets with excess demand move toward equilibrium?
higher profits.
They reduce supply, causing prices to rise. What describes how higher input costs affect equilibrium in the market for a good?
26.6% decrease The market price of a product increased by 7%. The absolute value of the price elasticity
of demand for this product is 3.8. What is the percent of change in quantity demanded?
Unit Elastic The average price of eggs increases from $1.10 to $1.30. In response, the quantity
supplied increases from 220 to 260 eggs. The elasticity of supply is equal to 1. What term
describes the price elasticity of this supply?
Perfect Competition What type of market is characterized by firms with no market power for any individual
firm?
Firms choose how much to produce. How do firms in a perfectly competitive market max profits when facing perfectly elastic
demand for their products?
Firms will experience zero long-run economic profits. What is an outcome of a perfectly competitive market?
