Unit 2 Test- Supply, Demand And Competition
- 1.Demand can only occur when a buyer is _________
- A.
Limited by time
- B.
Willing and able to buy
- C.
Buying substitutes
- D.
Determined to sell
- 2.If an item has a substitute it is defined as:
- A.
Complementary
- B.
Elastic
- C.
Inelastic
- D.
Utility
- 3.According to the Law of Supply, if price increases, supply:
- A.
Is not determined
- B.
Is elastic
- C.
Increases
- D.
Decreases
- 4.Competition has what effect on price?
- A.
Increases price
- B.
Has no effect on price
- C.
Keeps price low
- D.
Destroys the market
- 5.Which of the following is NOT a factor of demand?
- A.
Increase in customers
- B.
Income goes up
- C.
Substitution
- D.
Increase in capital goods
- 6.Following are factors of capitalism except:
- A.
Markets
- B.
Competition
- C.
Economic Freedom
- D.
State owned factories
- 7.The most competitive type of competition is _________
- A.
Perfect Competition
- B.
Monopoly
- C.
Monopolistic Competition
- D.
Oligopoly
- 8.If two products are commonly used together, they are considered:
- A.
Elastic
- B.
Complements
- C.
Substitutes
- D.
Inelastic
- 9.What economics concept explains how the recent rise in gas prices has not affected demand:
- A.
Inelasticity
- B.
Diminishing marginal utility
- C.
Oligopoly
- D.
Equilibrium
- 10.In general, as more suppliers enter the market:
- A.
Demand drops
- B.
Supply rises
- C.
Demand rises
- D.
Supply drops
- 11.If quantity supplied is greater than quantity demanded there will be a:
- A.
Surplus
- B.
Complement
- C.
Shortage
- D.
Substitute
- 12.According to the Law of Demand; if prices increase, demand
- A.
Increases
- B.
Decreases
- C.
Remains the same
- D.
Goes crazy
- 13.The government agency regulates advertising is:
- A.
FDA
- B.
EPA
- C.
CPSC
- D.
FTC
- 14.A hurricane hit the gulf coast of closing oil refineries. What will happen to the price of oil?
- A.
It will decrease
- B.
It will increase
- C.
It will remain the same
- D.
It will go crazy
- 15.Which of the following is characteristics of an elastic product?
- A.
Consumers have no option
- B.
Many competing brands
- C.
Occurs in a monopoly
- D.
Dominated by one seller
- 16.Peanut Butter and Jelly are used together. What will happen to the demand for jelly if the price of peanut butter decreases?
- A.
Increases
- B.
Decreases
- C.
Stays the same
- D.
Goes crazy
- 17.What would it be called if Cold Stone Creamery and Baskin Robbins joined together?
- A.
Trust
- B.
Merger
- C.
Monopoly
- D.
A big milky mess
- 18.A drought will cause the supply curve of water hungry vegetable to shift which way?
- A.
Left
- B.
No shift occurs
- C.
Right
- D.
Down
- 19.What determines the price in the U.S?
- A.
Utility
- B.
Supply and Demand
- C.
Consumers
- D.
Demand
- 20.Anti-trust laws are all of the following except:
- A.
Controls monopolies
- B.
Is a role of the government
- C.
Promotes competition
- D.
Combines companies
- 21.All of the following are private goods except:
- A.
Paper
- B.
Street lights
- C.
Rubber
- D.
Cars
- 22.An unintended side effect is also known as:
- A.
Utility
- B.
Merger
- C.
Externality
- D.
Monopoly
- 23.Individuals accepting the consequence of their actions is also known as:
- A.
Economic Freedom
- B.
Profit Motive
- C.
Property Rights
- D.
Competition
- 24.Adam Smith wrote about:
- A.
Wealthy people
- B.
Consumer safety
- C.
Economic Principles
- D.
Socialism
- 25.OPEC is an example of _______.
- A.
Monopolistic Competition
- B.
Cartel
- C.
Oligopoly
- D.
Perfect Competition
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