Chapter 4: Section 1 Quiz

1. Fuzzy dice, pet rocks, and nose rings are all examples of ______________, or consumer trends.

Fuzzy dice, pet rocks, and nose rings are all examples of fads. Fads refer to short-lived, popular trends that quickly gain popularity but also fade away quickly. These items were all trendy at some point but eventually lost their appeal and fell out of fashion. Fads are often driven by social influence and can be seen as a way for individuals to conform or express their individuality.

Explanation

Fuzzy dice, pet rocks, and nose rings are all examples of fads. Fads refer to short-lived, popular trends that quickly gain popularity but also fade away quickly. These items were all trendy at some point but eventually lost their appeal and fell out of fashion. Fads are often driven by social influence and can be seen as a way for individuals to conform or express their individuality.

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2. The law of supply states that producers supply more goods and services when they can sell them at ________________ prices and fewer goods and services when they must sell them at lower prices.

The law of supply states that producers supply more goods and services when they can sell them at higher prices and fewer goods and services when they must sell them at lower prices. This is because higher prices incentivize producers to increase their production and supply in order to maximize their profits. On the other hand, lower prices make it less profitable for producers to supply goods and services, leading to a decrease in supply.

Explanation

The law of supply states that producers supply more goods and services when they can sell them at higher prices and fewer goods and services when they must sell them at lower prices. This is because higher prices incentivize producers to increase their production and supply in order to maximize their profits. On the other hand, lower prices make it less profitable for producers to supply goods and services, leading to a decrease in supply.

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3. A perfectly inelastic supply curve in completely horizontal ( left to right across the graph paper)

True

False

A perfectly inelastic supply curve is not completely horizontal. It means that the quantity supplied does not respond to changes in price. In other words, even if the price increases or decreases, the quantity supplied remains the same. This is represented by a vertical supply curve, not a horizontal one. Therefore, the given statement is false.

Explanation

A perfectly inelastic supply curve is not completely horizontal. It means that the quantity supplied does not respond to changes in price. In other words, even if the price increases or decreases, the quantity supplied remains the same. This is represented by a vertical supply curve, not a horizontal one. Therefore, the given statement is false.

4. A supply curve plots on a graph the information from a demand schedule?

True

False

If false give the correct information.

Explanation

If false give the correct information.

5. What are 3 conditions that must be meant to satisfy the inelastic supply principle. Production requires a great deal of:

Time, money, and human capital

Money, raw materials, and investments

Time, money, and resources that are not readily available

None of the above

To satisfy the inelastic supply principle, three conditions must be met. Firstly, production requires a significant amount of time, meaning that it cannot be easily increased or decreased in the short term. Secondly, it requires a substantial amount of money, indicating that a significant investment is needed for production. Lastly, it necessitates resources that are not readily available, suggesting that the inputs required for production are scarce or limited in availability. Therefore, the correct answer is time, money, and resources that are not readily available.

Explanation

To satisfy the inelastic supply principle, three conditions must be met. Firstly, production requires a significant amount of time, meaning that it cannot be easily increased or decreased in the short term. Secondly, it requires a substantial amount of money, indicating that a significant investment is needed for production. Lastly, it necessitates resources that are not readily available, suggesting that the inputs required for production are scarce or limited in availability. Therefore, the correct answer is time, money, and resources that are not readily available.

6. The picture on the first page of chapter 4 shows two ladies holding a container of garden vegatables, which helps describe the business that they are in.

True

False

If the answer is false, put in the correct information to make in true.

Explanation

If the answer is false, put in the correct information to make in true.

7. In the supply schedule given below, which choice or choices would companies producing the product of toothpaste, most likely want to chose? https://www.google.com/imgres?imgurl=https://www.amosweb.com/images/MkSp31.gif&imgrefurl=https://www.amosweb.com/cgi-bin/awb_nav.pl?s%3Dwpd%26c%3Ddsp%26k%3Dsupply%2Bschedule&h=203&w=218&sz=4&tbnid=eLXzUZ1Pvb-qFM:&tbnh=90&tbnw=97&zoom=1&usg=__QDBxxlE7luXS9iKLV5AaQ1T0n8Q=&docid=dx08352Y8D0nZM&sa=X&ei=jwOPUK2FJ-qY2wWTsYGgAw&ved=0CEMQ9QEwBQ&dur=6

Choice A

Choice B

Choice C

Choice J

Choice I

Choice H

Based on the supply schedule provided in the link, the companies producing toothpaste would most likely want to choose Choice H. This is because Choice H represents a higher quantity supplied at a higher price, indicating that the companies would be willing to produce and supply more toothpaste at higher prices. This suggests that the companies would want to maximize their profits by choosing the option that allows them to produce and sell more toothpaste at higher prices.

Explanation

Based on the supply schedule provided in the link, the companies producing toothpaste would most likely want to choose Choice H. This is because Choice H represents a higher quantity supplied at a higher price, indicating that the companies would be willing to produce and supply more toothpaste at higher prices. This suggests that the companies would want to maximize their profits by choosing the option that allows them to produce and sell more toothpaste at higher prices.

8. Why would the prices for sports memorabilia increase in price during a season in which that team was successful? Check all that apply.

The buyers know that the price of the items will decline.

If a team is successful their proud fans want to display their items to the public.

Rival fans will buy up some of the items knowing that they should go up in price.

The supply of these items is low and they will be expensive.

When a team is successful, their proud fans want to display their items to the public. This increases the demand for sports memorabilia, leading to an increase in prices. Additionally, rival fans may buy up some of the items, anticipating that their value will go up in price. This further drives up the demand and prices. Overall, the combination of high demand from proud fans and rival fans, along with limited supply, causes the prices for sports memorabilia to increase during a successful season.

Explanation

When a team is successful, their proud fans want to display their items to the public. This increases the demand for sports memorabilia, leading to an increase in prices. Additionally, rival fans may buy up some of the items, anticipating that their value will go up in price. This further drives up the demand and prices. Overall, the combination of high demand from proud fans and rival fans, along with limited supply, causes the prices for sports memorabilia to increase during a successful season.

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9. Match two items that are examples of elastic supply and two items that are examples of inelastic supply.

elastic

inelastic

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