Answers2102320-Economics HONORS - Edgenuity TeacherProfit

Unit 2 Test Answers

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21
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Equilibrium occurs when supply and demand coordinate to

A
set excess demand.
B
set prices and production.
C
maintain excess supply.
D
raise prices and production.
22
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Why is pure competition considered an unsustainable system?

A
Price differentiation is often too minimal to matter.
B
Few barriers exist to entry, meaning that the market inevitably floods.
C
Consumers cannot distinguish between products.
D
Producers cannot make a profit if they keep dropping their prices.
23

Which statements correctly explain price floors and price ceilings? Choose four answers.Ineffective price floors tend to be too high.Ineffective price ceilings tend to be too low.Price floors help producers by raising prices.Price ceilings help consumers by lowering prices.Effective price floors are set above equilibrium.Effective price ceilings are set below equilibrium.

A
Ineffective price floors tend to be too high.
B
Ineffective price ceilings tend to be too low.
C
Price floors help producers by raising prices.
D
Price ceilings help consumers by lowering prices.
E
Effective price floors are set above equilibrium.
F
Effective price ceilings are set below equilibrium.
24

Wellness Pharmaceuticals has released a new antidepressant, Lexabuzac. Which type of monopoly does the company most likely have on this medication?

A
natural monopoly
B
de facto monopoly
C
government monopoly
D
technological monopoly
25

Which quality best describes a producer with an absolute advantage?

A
efficient
B
fast
C
accurate
D
prolific
26

A monopoly is a market that has

A
few competing businesses.
B
many sellers of the same item.
C
many sellers of a variety of products.
D
a single supplier of a good or service.
27

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28

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29

The graph shows a point of equilibrium.If quantity demanded exceeds quantity supplied, what most likely needs to happen to achieve equilibrium?

Question illustration
A
The supply needs to increase
B
The price needs to decrease
C
The price needs to increase
D
The demand needs to increase
30

Which statement best explains the role of producers in economics?

A
Producers supply goods and services.
B
Producers purchase goods and services.
C
Producers create theories about the market.
D
Producers sell shares for companies in the market.
31

When prices drop below the point where supply and demand meet, it results in

A
coordination.
B
disequilibrium.
C
equilibrium.
D
production.
32

Which best describes how specialized producers decrease their opportunity costs?

A
by reducing production costs
B
by focusing on target markets
C
by increasing production of certain items
D
by limiting the types of goods produced
33

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34

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35

Look at the chart comparing the price of graphic T-shirts to the quantity supplied.

Question illustration
A
demand curve.
B
demand schedule.
C
supply curve.
D
supply schedule.
36

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37

In which way do producers try to differentiate themselves in monopolistic competition?

A
price
B
advertising
C
product features
D
image
38

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39

A possible result of disequilibrium is

A
excess demand.
B
lower demand.
C
fixed prices.
D
stable availability.
40

When supply is higher than demand, prices will

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

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