AnswersPersonal FinanceMicroeconomics and Entrepreneurship

Microeconomics and Entrepreneurship — Test Answers

25 verified answers
1
Free Preview

What most likely will happen if the pie maker continues to make additional pies?

A
The marginal costs will continue to fall, decreasing the total cost, while the marginal revenue remains the same, increasing the profit earned for each pie.
B
The marginal costs will continue to fall, decreasing the total cost, while the marginal revenue remains the same, decreasing the profit earned for each pie.
C
The marginal costs will continue to rise, increasing the total cost, while the marginal revenue remains the same, decreasing the profit earned for each pie.
D
The marginal costs will continue to rise, increasing the total cost, while the marginal revenue remains the same, increasing the profit earned for each pie.
2
Free Preview

Brenda’s Boards manufactures skateboards. Each skateboard sells for $45 and includes the following expenses: $3 for the wheels and mounts, $1 for the plastic board, $1 for the paint, and $10 for the labor. What is the total profit the company earns after selling 100 boards?

A
$350
B
$300
C
$3,500
D
$3,000
3

Becoming informed about economics helps a person understand the

A
reasons a command economy is ideal.
B
reasons an economy must always be completely regulated.
C
why consumers receive tax revenue.
D
role of government in regulating production.
4

What led to Henry Ford’s success as an entrepreneur?

A
His commitment to improving labor laws.
B
His innovative production methods.
C
His desire to pay high wages.
D
His personal wealth.
5

An entrepreneur would most likely be a

A
low risk taker.
B
person who has a brief work week.
C
person who works well alone.
D
spontaneous person with an unclear vision.
6

A market supply schedule shows

A
the prices and quantity in an entire market.
B
how prices affect a group of consumers.
C
how prices affect a single producer.
D
the products of two companies only.
7

Which statement best describes a command economy?

A
The decisions made by producers and consumers drive all economic choices.
B
Producers and consumers make some economic choices while the government makes others.
C
Government intervention in economic choices is strictly forbidden.
D
The government determines economic choices and makes most decisions.
8

What is the best definition of ownership?

A
Ownership is the right to purchase goods alone.
B
Ownership is the right to possess land alone.
C
Ownership is the right to possess land or goods.
D
Ownership is the right to purchase land or goods.
9

How does a command economy differ from a mixed market economy?

A
In a command economy, citizens own all public property. In a mixed market economy, the government owns all private property.
B
In a command economy, citizens have fewer property rights. In a mixed market economy, citizens have more property rights.
C
In a command economy, citizens have more property rights. In a mixed market economy, citizens have fewer property rights.
D
In a command economy, citizens own all private property. In a mixed market economy, the government owns all public property
10

Which is an example of a product that is considered a need?

A
music player
B
video game
C
breakfast food
D
sports equipment
11

The most common economic system in the world is a

A
traditional economy.
B
closed economy.
C
mixed market economy.
D
command economy.
12

A person studying economics chooses to buy an economic textbook for their class, even though it means they cannot afford to buy a video game they want. This shows an understanding of

A
goods.
B
consequences and tradeoffs.
C
production.
D
services.
13

Goods that are considered to be needs tend to be

A
inelastic when the price changes.
B
elastic when the price changes.
C
elastic when the supply changes.
D
inelastic when the supply changes.
14

Which statement best describes a pure market economy?

A
The decisions made by producers and consumers drive all economic choices.
B
The government determines economic choices and makes most decisions.
C
Producers and consumers make some economic choices while the government makes others.
D
Producer intervention in economic choices is strictly forbidden.
15

What is the fundamental problem producers and consumers face?

A
resources
B
scarcity
C
services
D
inadequacy
16

The total amount of a product available in a market at a given price is called the

A
demand.
B
supply.
C
count.
D
number.
17

When supply is higher than demand, prices will

A
fall until the demand rises.
B
fall until the supply rises.
C
rise until the demand falls.
D
rise until the supply falls.
18

Which of these are influenced by personal economic choices? Choose four correct answers.

A
the manner in which you balance your time between work and leisure
B
the resources you have available
C
the amount of money you spend on a bus pass
D
the cost of your rent and utilities
E
the amount of money you put into your savings account
F
the money you decide to spend on leisure products
19

In economics, if a good is inelastic,

A
consumers have lost an interest in purchasing it.
B
its supply or demand is too sensitive to price changes.
C
producers have lost an interest in manufacturing it.
D
its supply or demand is not sensitive to price changes.
20

Which statements correctly explain price floors and price ceilings? Choose four correct answers.

A
Price ceilings help consumers by lowering prices.
B
Effective price ceilings are set below equilibrium.
C
Price floors help producers by raising prices.
D
Ineffective price floors tend to be too high.
E
Effective price floors are set above equilibrium.
F
Ineffective price ceilings tend to be too low.

Did you find these answers helpful?

More from this Course

Quiz
48 verified answers

Exam

Microeconomics and Entrepreneurship — Test…