Answers2102320-Economics HONORS - Edgenuity TeacherElasticity and Incentives

Elasticity and Incentives — Unit test Answers

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21
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Which is the best title for this diagram?

Question illustration
A
The Definition of Supply
B
Factors That Affect Supply
C
Elasticity and Competition
D
The Law of Supply
22
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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
Consumers only trust known companies to provide these essentials.
D
There is no need for alternative options.
23

Which is likely to occur if there is a price increase for a good which exhibits elastic demand?

A
People might buy a more expensive substitute good.
B
People might buy a less expensive complementary good.
C
People might buy a less expensive substitute good.
D
People might buy a more expensive complementary good.
24

What are the factors of production in business?

A
land, labor, and capital
B
land, capital, and interest
C
land, labor, and customer base
D
capital, customer base, and interest
25

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.
26

What are the factors of production in business?

A
land, labor, and capital
B
land, capital, and interest
C
land, labor, and customer base
D
capital, customer base, and interest
27

Which best describes the relationship between consumers and producers?

A
They usually ignore each other.
B
They interact with each other.
C
They agree on prices.
D
They dislike each other.
28

[BLANK]

A
increases
B
decreases
C
stays the same
29

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

A
price
B
advertising
C
product features
D
image
30

Both a demand curve and a demand schedule show how

A
prices affect consumer demand.
B
consumer demand affects income.
C
prices affect complementary goods.
D
consumer demand affects substitute goods.
31

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.
32

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
Consumers only trust known companies to provide these essentials.
D
There is no need for alternative options.
33

Producers hoping to earn profits supply goods and services to

A
debtors.
B
themselves.
C
competitors.
D
consumers.
34

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
35

What does elasticity measure in economics?

A
how the amount of a good changes when the producer hires more employees
B
how the amount of a good changes when the producer uses new materials
C
how the amount of a good changes when its price goes up or down
D
how the amount of a good changes when its distribution expands
36

[BLANK]

A
combination
B
prices
C
value
37

A chart that shows the connection between consumer demand and price is a

A
market schedule.
B
market curve.
C
demand curve.
D
demand schedule.
38

A possible result of disequilibrium is

A
excess demand.
B
lower demand.
C
fixed prices.
D
stable availability.
39

The graph is a marginal cost curve that compares expenses for producing apple pies.According to the graph, the marginal cost begins to increase when the producer makes

Question illustration
A
two pies.
B
three pies.
C
four pies.
D
five pies.

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