Unit Test — Unit test Answers

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If consumer sovereignty is considered greatest in a system of pure competition, why is sovereignty still limited?

Consumers still rely on producers’ set prices.

Few products are actually sold on the basis of pure competition.

Choices are driven by price when goods are identical.

Limited price variations restrict actual choice.

Which is an example of a negative incentive for producers?

a chance to make more money

a special sale at a department store

a coupon clipped from a newspaper

a sharp increase in production costs

best

Incentives are mostly positive.

Incentives are mostly negative.

Incentives can be positive or negative.

Incentives are neither positive nor negative.

A consumer might respond to a negative incentive by

purchasing more of the products.

buying the good at a cheap price.

receiving a discount.

decreasing use of the product to save money.

The graph shows a demand curve.Which most likely accounts for the changes shown on the demand curve?

More consumers want a product. ✓ Correct

Fewer consumers want a product.

The price of a product rises a little.

The price of a product rises sharply.

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