AnswersISP ONLY Economics S5000XXInvesting and Financial Markets

Investing and Financial Markets — Unit test Answers

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1
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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.
2
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A
elasticity
B
quality
C
time
D
quantity
3

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

A
coordination.
B
disequilibrium.
C
equilibrium.
D
production.
4

A possible result of disequilibrium is

A
excess demand.
B
lower demand.
C
fixed prices.
D
stable availability.
5

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
6

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
7

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.
8

How do bank loans help the nation’s economy?

A
They ensure consumer spending and confidence.
B
They ensure the success of new businesses.
C
They allow businesses to expand and improve.
D
They allow consumers to quickly pay off debts.
9

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.

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