Economics Practice Test - Units 3 & 4

9 Questions | Total Attempts: 72

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Economics Quizzes & Trivia

Practice Test for Mr. Campbell's Economics class.


Questions and Answers
  • 1. 
    Monopolistic competition is characterized by:
    • A. 

      A few firms and low barriers to entry

    • B. 

      Large number of firms and many barriers

    • C. 

      Large number of firms and low barriers

    • D. 

      Few firms and many barriers

  • 2. 
    What does it mean when demand for a product is inelastic?
    • A. 

      People will buy much less of the product as the price rises

    • B. 

      People will not buy any of the product when price goes up

    • C. 

      There are very few substitute products for the good.

    • D. 

      A price increase does not have a significant impact on purchasing habits.

  • 3. 
    What happens to supply when the selling price of an items down?
    • A. 

      The cost of the items goes down.

    • B. 

      The profit of the item goes down.

    • C. 

      Businesses will produce less goods.

    • D. 

      There is no relationship between the two.

  • 4. 
    Rent control is a type of:
    • A. 

      Rationing

    • B. 

      Price ceiling

    • C. 

      Price floor

    • D. 

      Surplus

  • 5. 
    In a publicly held corporation:
    • A. 

      Stockholders rarely trade their stock

    • B. 

      A large number of stock holders can buy and sell stock

    • C. 

      Stocks are not usually traded at stock exchange

    • D. 

      Family members are excluded from holding stock

  • 6. 
    How much control do firms in a perfect competition market have over price?
    • A. 

      None

    • B. 

      Very little

    • C. 

      Some

    • D. 

      Total control

  • 7. 
    What is an example of a variable cost in a Major League Baseball team?
    • A. 

      Players salaries

    • B. 

      Ticket sellers salaries

    • C. 

      Field maintenance

    • D. 

      Stadium rent

  • 8. 
    Which of the following is a disadvantage of sole proprietorship?
    • A. 

      High taxes

    • B. 

      Difficult to start up

    • C. 

      Legal fees

    • D. 

      Lack of permanence

  • 9. 
    A barrier to entry could be a:
    • A. 

      Technology

    • B. 

      Start up cost

    • C. 

      Licenses

    • D. 

      All of the above

    • E. 

      None of the above

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