Placeholder

ECO561 Economics Week 1 Knowledge Check

$12.00

Category: .

Product Description

ECO561 Economics  Week 1 Knowledge Check

Top of Form

1.

Revenue increases when

  • A.

producer surplus increases

  • B.

producer surplus decreases

  • C.

consumer surplus increases

  • D.

consumer surplus decreases

2. An increase in the price of an inelastic good

  • A.

decreases revenues

  • B.

decreases the percentage change in quantity less than the percentage change in price

  • C.

increases revenues

  • D.

increases the percentage change in quantity more than the percentage change in price

3. Price elasticity of Demand increases when

  • A.

the number of complementary goods decreases

  • B.

the number of substitute goods decreases

  • C.

people become more price sensitive over time

  • D.

people become less price sensitive over time

4.

The purpose of a market in a market system is to

  • A.

allow government to control what is sold

  • B.

set constraints between buyers and sellers

  • C.

bring buyers and sellers into contact

  • D.

allow an organization to set prices in relation to their products

5.

By specializing in the production of one good, a company is able to benefit from economies of scale which increases its revenue. Which of the following is an attribute of specialization?

  • A.

Reducing costs by creating a surplus

  • B.

Saving time by allowing a worker to focus on one task

  • C.

Encouraging workers to learn new skills

  • D.

Encouraging workers to learn a number of different skills

 

6 .  The market system promotes progress by

  • A.

creating incentive to continue to do things in the same way

  • B.

restricting the amount of capital directed to specific goods

  • C.

slowly adjusting to changes in the prices of resources

  • D.

providing incentive for technological advances

7.

Productive efficiency is achieved when

  • A.

the most valued combination of resources is used

  • B.

the best technology is used

  • C.

when production occurs at a fair cost per unit

  • D.

fewer resources are left for production of other goods

8.

The market is said to be in equilibrium when

  • A.

there is potential for a shortage but not a surplus

  • B.

there is potential for a surplus but not a shortage

  • C.

neither a shortage nor a surplus exists

  • D.

the quantity sold equals the quantity purchased

 

Top of Form

9.

The market will move to a higher equilibrium price if

  • A.

the decrease in supply is equal to the decrease in demand

  • B.

the increase in supply is greater than the increase in demand

  • C.

the decrease in demand is greater than the decrease in supply

  • D.

the increase in demand is greater than the increase in supply

 

10.

The intersection of supply and demand will be at a lower equilibrium price but a higher equilibrium quantity if

  • A.

supply is constant and demand increases

  • B.

supply is constant and demand decreases

  • C.

demand is constant and supply decreases

  • D.

demand is constant and supply increases

 

11.

When a price ceiling occurs

  • A.

the market price will be lower than the equilibrium price

  • B.

the market price will be higher than the equilibrium price

  • C.

the supply will exceed the demand

  • D.

buyers will not be willing to pay more than the ceiling price

 

12.

Because the goals of firms, entrepreneurs, and workers have different incentives, which of the following principles applies?

  • A.

Self-interest

  • B.

Invisible hand

  • C.

Moral hazard

  • D.

Free enterprise

 

Bottom of Form

 

Bottom of Form