Middle Exam Review form B

Middle Exam Review form B

Basic Economic Problem1. The total amount of goods and services that can be produced in the world economy will be:

A. Determined by the amount of natural resourcesB. UnlimitedC. Just enough to satisfy all consumer wantsD. Less than what consumers want

Price of Related goods2. Cola and lemonade are substitute goods. What will happen when the price of lemonade increases?A. The demand for lemonade will increaseB. The price of cola will increaseC. The demand for cola will increaseD. The supply of chicken nuggets will rise

Individual supply vs. Market Supply3. The sum of all the individual supply curves for a product is called?A. total supply.B. market supply.C. aggregate supply.D. total output.

Scarcity4. In which of the following situations is a good NOT scarce?

Consumers give up nothing to obtain more of the good.B. Consumers can purchase as much of the good as they want at its current market price. C. Large quantities of the good are available in the marketplace.D. There is a surplus of the good at some positive price.

A good is not scarce if you do not have to give anything up to get it!

Market Demand vs. Individual Demand

5. The market demand curve:A. is the sum (total) of all individual demand curves.B. is the demand curve for every product in an industry.C. shows the average quantity demanded by individual demanders at each price. D. is always flatter than an individual demand curve.

QD vs Curve Shift6. When quantity demanded increases at every possible price, the demand curve has: A. shifted to the left.B. shifted to the right.C. not shifted; rather, we have moved along the demand curve to a new point on the same curve.D. not shifted; rather, the demand curve has become steeper.

QD vs Demand7. An increase in the price of a good will: A. increase demand.B. decrease demand.C. increase quantity demanded. D. decrease quantity demanded.

PRICE DOES NOT SHIFT THE CURVEThis question was not marked8. The quantity demanded of a good is the amount that buyers are : A. willing to purchase.B. willing and able to purchase.C. willing, able, and need to purchase. D. able to purchase.

QD vs. Demand9. Which of the following doesnt influence the demand:A. Cost of productionB. PriceC. WeatherD. Income

QD vs. Demand9. Which of the following doesnt influence the demand:A. Cost of productionB. PriceC. WeatherD. Income

PRICE DOES NOT SHIFT DEMANDEquilibrium price = S= D 10. Equilibrium price is the price at which?A. Everything that is produced is soldB. The number of buyers equals the number of sellersC. The amount of buyers demand is equal to the amount sellers supplyD. Supply exceeds demand

Equilibrium price = S= D 10. Equilibrium price is the price at which?A. Everything that is produced is soldB. The number of buyers equals the number of sellersC. The amount of buyers demand is equal to the amount sellers supplyD. Supply exceeds demand

Expectations of future price11. If a seller expects higher basket prices in the near future, the currentA. supply of baskets will increase.B. supply of baskets will decrease.C. supply of baskets will be unaffected.D. demand for baskets will decrease.

Expectations of future price11. If a seller expects higher basket prices in the near future, the currentA. supply of baskets will increase.B. supply of baskets will decrease.C. supply of baskets will be unaffected.D. demand for baskets will decrease.

This one was not easy12. Which of the following is a determinant of the market supply curve but not a determinant of an individual sellers supply?A. production technologyB. expectationsC. input pricesD. the number of sellers

These Choices were terrible 13. What is a mixed economy?A. One in which both capital and consumer goods are producedB. One in which both necessities and luxuries are producedC. One in which there is both an agricultural and manufacturing sectorD. One in which there is both a private and a public sector

Come on ~ you should know this14. What is meant by opportunity cost?A. The best alternative forgone (given up)B. The cost of the item selectedC. The cost of exploring business opportunitiesD. The labor used in producing the product

Come on ~ you should know this14. What is meant by opportunity cost?A. The best alternative forgone (given up)B. The cost of the item selectedC. The cost of exploring business opportunitiesD. The labor used in producing the product

Basic Economic Question15. The basic economic problem of all countries is the existence of: A. tax increases and budget deficitsB. limited resources and unlimited wantsC. unemployment and inflationD. government and private industry

Basic Economic Question15. The basic economic problem of all countries is the existence of: A. tax increases and budget deficitsB. limited resources and unlimited wantsC. unemployment and inflationD. government and private industry

PED 4 steps16. When the price of used CDs is $4, Daphne buys five per month. When the price is $3, she buys nine per month. Daphnes demand for used CDs is:A. elastic, and her demand curve would be relatively flat. B. elastic, and her demand curve would be relatively steep. C. inelastic, and her demand curve would be relatively flat.D. inelastic, and her demand curve would be relatively steep.A figure out Q1 P1: Q2 P2B determine the % change in QC determine the % change in PD PED = change in Q/Change in PHe dead17. Which of the following is an illustration of the market for original paintings by deceased artist Vincent Van Gogh?

Which graph shows a dead supplier and normal demand?

CPerfectly Elastic18. When small changes in price lead to infinite changes in quantity demanded, demand is perfectly?A. elastic, and the demand curve will be horizontal. B. inelastic, and the demand curve will be horizontal. C. elastic, and the demand curve will be vertical.D. inelastic, and the demand curve will be vertical.

THE PRIVATE FIRM AS PRODUCER AND EMPLOYER19. If the price of walnuts rises, many people would switch from consuming walnuts to consuming pecans. But if the price of salt rises, people would have difficulty purchasing something to use in its place. These examples illustrate the importance of:A. the availability of close substitutes in determining the price elasticity of demand. B. a necessity versus a luxury in determining the price elasticity of demand.C. the definition of a market in determining the price elasticity of demand. D. the time horizon in determining the price elasticity of demand.

20. If muffins and bagels are substitutes, a higher price for bagels would result in a(n)? A. increase in the demand for bagels. B. decrease in the demand for bagels. C. increase in the demand for muffins. D. decrease in the demand for muffins.20. If muffins and bagels are substitutes, a higher price for bagels would result in a(n)? A. increase in the demand for bagels. B. decrease in the demand for bagels. C. increase in the demand for muffins. D. decrease in the demand for muffins.21. When quantity demanded increases at every possible price, the demand curve has:

A. shifted to the left. B. shifted to the right. C. not shifted; rather, we have moved along the demand curve to a new point on the same curve. D. not shifted; rather, the demand curve has become steeper.21. When quantity demanded increases at every possible price, the demand curve has:

A. shifted to the left. B. shifted to the right. C. not shifted; rather, we have moved along the demand curve to a new point on the same curve. D. not shifted; rather, the demand curve has become steeper.22. If Max experiences a decrease in his income, then we would expect Maxs demand for: A. each good he purchases to remain unchanged. B. normal goods to decrease. C. luxury goods to increase. D. inferior goods to decrease.22. If Max experiences a decrease in his income, then we would expect Maxs demand for: A. each good he purchases to remain unchanged. B. normal goods to decrease. C. luxury goods to increase. D. inferior goods to decrease.23. During the 1990s many countries in Eastern Europe transformed from planned economies to more market-oriented economies. Which of the following best describes this change? A. More public sector control of resources B. Increased use of the price mechanism to allocate resources C. Less private sector ownership of resources D. Increased use of price controls23. During the 1990s many countries in Eastern Europe transformed from planned economies to more market-oriented economies. Which of the following best describes this change? A. More public sector control of resources B. Increased use of the price mechanism to allocate resources C. Less private sector ownership of resources D. Increased use of price controls24. A boat owner employs a crew to catch fish to sell on the market. Which factors of production are involved in this activity?

A. Labour, capital and enterprise only B. Land, labour, capital and enterprise C. Land and labour only D. Labour and capital only24. A boat owner employs a crew to catch fish to sell on the market. Which factors of production are involved in this activity?

A. Labour, capital and enterprise only B. Land, labour, capital and enterprise C. Land and labour only D. Labour and capital only25. In the diagram below what is the opportunity cost of increasing the output of cars from 550 per week to 640 per week ?26. The market for a normal good is in equilibrium at point X. Consumers incomes fall and the cost of producing the good rises. In which area of the diagram will the new equilibrium be? 27. Why might a free market economy be more advantageous than a mixed economy? A. Equality of income is encouraged. B. In a mixed economy, governments use taxes which are inefficient. C. Production is determined solely by consumer wishes. D. Social costs are taken into consideration.27. Why might a free market economy be more advantageous than a mixed economy? A. Equality of income is encouraged. B. In a mixed economy, governments use taxes which are inefficient. C. Production is determined solely by consumer wishes. D. Social costs are taken into consideration.28. Each month Jacquelyn spends exactly $50 on ice cream regardless of the price of each container. Jacquelyn's price elasticity of demand for ice cream is: A. 0 B. 1 C. greater than 1, but less than 5 D. less than 1, but greater than 028. Each month Jacquelyn spends exactly $50 on ice cream regardless of the price of each container. Jacquelyn's price elasticity of demand for ice cream is: A. 0 B. 1 C. greater than 1, but less than 5 D. less than 1, but greater than 029. Any point inside a production possibilities curve is? A. better than points on the production possibilities curve B. allocatively efficient but technologically inefficient C. associated with inefficient use or unemployment of some resources D. associated with movements along the production possibilities curve29. Any point inside a production possibilities curve is? A. better than points on the production possibilities curve B. allocatively efficient but technologically inefficient C. associated with inefficient use or unemployment of some resources D. associated with movements along the production possibilities curve30. Which of the following might cause the demand curve for an inferior good to shift to the left? A. a decrease in income B. an increase in the price of a substitute C. an increase in the price of a complement D. none of the above is correctMobile Learning Sign UpRules of using the internet in classIf I catch you playing ~ you get 1 warningIf I catch you again I take your phone/pad/computer for class3. If I catch you a 3rd time I take your phone/pad/computer and give to your home-room teacher4. If I catch you a 4th time I take your phone/pad/computer and give to the grade 10 leader and you lose internet privileges for 1 month

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Here you will have all of our ppts, quizzes, and notes1. a. Complement goods are goods sold separately, but dependent on each other for sales. Give any TWO groups of complement goods. b. Substitutes can satisfy the same want. Give any TWO groups of substitutes. c. Suggest any FOUR reasons why market demand of coffee bean may fall.Qo$5

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1PDemand Schedule10 20 30 40 50 60 70 8059PQd$510$420$330$250$180DSSupply SchedulePQs$550$440$330$220$110Supply and Demand are put together to determine equilibrium price and equilibrium quantity Qo$5

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1PDemand Schedule10 20 30 40 50 60 70 8060PQd$510$420$330$250$180Supply SchedulePQs$550$440$330$220$110DSWhen there is a surplus, producers lower pricesThe FREE MARKET system automatically pushes the price toward equilibrium.When there is a shortage, producers raise pricesAt a price of $3 dollars, what do we call it in the market?Equilibrium ----- 5 pointsb. At a price of $4 dollars, which situation will happen? And what is the quantity?a surplus of 20 Q ----- 5 pointsc. At a price of $2, which situation will happen? And what is the quantity?a shortage of 30 Q ----- 5points

2. a. Complement goods are goods sold separately, but dependent on each other for sales. Give any TWO groups of complement goods.

b. Substitutes can satisfy the same want. Give any TWO groups of substitutes. c. Suggest any FOUR reasons why market demand of coffee bean may fall.Answers:Cars and gasoline, butter and bread ----- 2.5 points Cars and subway, Ipad and laptop ---- 2.5 points

C(1)a fall in disposable incomes after tax--- 2.5 points(2)a fall in the price of tea--- 2.5 points(3)a rise in the price of a milk shake ---- 2.5 points(4)a fall in the population -----2.5 points

You own a small town movie theatre. You currently charge $5 per ticket for everyone who comes to your movies. Your friend who took an economics course in college tells you that there may be a way to increase your total revenue. Given the demand curves shown, answer the following questions.a.What is your current total revenue for both groups?The elasticity of demand is more elastic in which market?What is the elasticity of demand between the prices of $5 and $2 in the adult market? Is this elastic or inelastic?

You own a small town movie theatre. You currently charge $5 per ticket for everyone who comes to your movies. Your friend who took an economics course in college tells you that there may be a way to increase your total revenue. Given the demand curves shown, answer the following questions.

e.Given the graphs and what your friend knows about economics, he recommends you increase the price of adult tickets to $8 each and lower the price of a child's ticket to $3. How much could you increase total revenue if you take his advice?

Total Revenue = P*Q.A. Total revenue from children's tickets is $100 ($5*20) and from adult tickets is $250 ($5*50). (Total revenue from all sales would be $350.) ----2 points b.

B. The demand for children's tickets is more elastic (It is flatter). ----- 2 point

The elasticity of demand between $5 and $2 is 0.21, which is inelastic. 3 points

A. P1Q1, P2Q2: = P1=$5, Q1=50: P2=$2, Q2=60

B % change in Quantity = Q2-Q1/(Q2+Q1)/2 = 60-50/(60+50)*1/2 = 10/55 = .18%

C. % change in Price = P2-P1/(P2+P1)/2 = $5-$2/(5+2)*1/2 = 3/3.5 = .85%

D. PED=% change Q/% change P = .18%/.85% = .21

.21 is less than 1 so we know it is inelastic

e.Total revenue in the adult market would be $320 ($8*40). Total revenue in the childrens market would be $120 ($3*40), so total revenue for both groups would be $440. $440 - $350 is an increase in total revenue of $90. -----3 points

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