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Practice Test Answers

12 verified answers
1
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Which food truck has the absolute advantage?

A
Kimchi Kim’s
B
Lunch on the Go
C
Frank’s Falafels
D
Deli Delight
2
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According to the graph, the marginal cost begins to increase when the producer makes

A
four pies.
B
five pies.
C
two pies.
D
three pies.
3

Which manufacturing company has the comparative advantage for car parts?

A
Company A
B
Company B
C
Company C
D
Company D
4

This chart is an example of a

A
demand schedule.
B
demand curve.
C
supply schedule.
D
supply curve.
5

A clothing store has ordered a new supply of jeans for the fall season and wants to sell off the remaining items from the previous spring. What action would the store owner most likely take?

A
The store owner would most likely raise the price of the spring jeans to encourage producers.
B
The store owner would most likely lower the price of the spring jeans to encourage consumers.
C
The store owner would most likely lower the price of the spring jeans to encourage producers.
D
The store owner would most likely raise the price of the spring jeans to encourage consumers.
6

Equilibrium occurs when supply and demand coordinate to

A
set excess demand.
B
maintain excess supply.
C
raise prices and production.
D
set prices and production.
7

Why are utilities, such as electricity and water, examples of natural monopolies?

A
The cost of production restricts competition in the market.
B
There are limited natural resources to meet demand.
C
There is no need for alternative options.
D
Consumers only trust known companies to provide these essentials.
8

What does elasticity measure in economics?

A
how the amount of a good changes when the producer uses new materials
B
how the amount of a good changes when its distribution expands
C
how the amount of a good changes when its price goes up or down
D
how the amount of a good changes when the producer hires more employees
9

A monopoly is a market that has

A
many sellers of a variety of products.
B
many sellers of the same item.
C
a single supplier of a good or service.
D
few competing businesses.
10

Which statement best explains the role of producers in economics?

A
Producers create theories about the market.
B
Producers sell shares for companies in the market.
C
Producers purchase goods and services.
D
Producers supply goods and services.
11

If quantity demanded exceeds quantity supplied, what most likely needs to happen to achieve equilibrium?

A
The supply needs to increase.
B
The price needs to increase.
C
The demand needs to increase.
D
The price needs to decrease.
12

What most likely will happen if the pie maker bakes a seventh pie?

A
The marginal revenue will most likely increase to 12 point 0 0 dollars .
B
The marginal cost will most likely increase to 2 point 0 0 dollars
C
The marginal cost will most likely decrease to 1 point 0 0 dollars
D
The marginal revenue will most likely decrease to 8 point 0 0 dollars .

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