Elasticity and Incentives — Unit test Answers
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Which best describes how specialized producers decrease their opportunity costs?
A
by reducing production costsB
by focusing on target marketsC
by increasing production of certain itemsD
by limiting the types of goods produced2
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The chart shows the marginal cost and marginal revenue of producing apple pies. What most likely will happen if the pie maker continues to make additional pies?
A
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.B
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.C
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.D
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.3
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.4
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.5
Which quality best describes a producer with an absolute advantage?
A
efficientB
fastC
accurateD
prolific6
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.7
Look at the chart comparing the price of graphic T-shirts to the quantity supplied.
A
demand curve.B
demand schedule.C
supply curve.D
supply schedule.8
When prices drop below the point where supply and demand meet, it results in
A
coordination.B
disequilibrium.C
equilibrium.D
production.Did you find these answers helpful?
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