_____2. a Product That Is Commonly Used with Another Products

NAME______EGovernment & Economics

DATE______Ch 3 4 5

Matching

_____1. The amount of a particular good or service that a consumer is willing and able to buy at each particular price

_____2. A product that is commonly used with another products.

_____3. This exists when a small change in a good’s price has a large impact on the quantity demanded.

_____4. Examples of these include wages and raw materials

_____5. A product that can be used to replace the purchase of similar products when prices rise.

_____6. Exists when even a large change in price has little impact on the quantity demanded

_____7. Examples of these include rent, interest on loans, and salaries

A. elastic demandB. variable costsC. substitute good D. income effect

E. inelastic demandF. fixed costs G. quantity demanded H. complementary good

_____8. A demand curve only displays a ‘snapshot” of a market because

1. prices or products often increase

2. it is based on a demand schedule

3. economists cannot make long-term projections

4. it represents a specific time period

_____9. As income rises, demand for goods

1. decreases3. remain stable

2. increases4. fluctuates

_____10. Which direction will the demand curve shift if consumers’ income rise?

1. to the right3. upward

2. to the left4. downward

_____11. A products’ demand elasticity is affected by

1. whether or not it has available substitutes

2.whether or not it is a necessity

3. the portion of the consumers’ income that the product’s cost represents

4. all of the above

_____12. The nonprice determinants of demand include

1. income, prices of related goods, demand curves

2. consumer tastes, market size, and decisions by private businesses

3. demand curves, market size, and income

4. market size, income, and prices of related goods

_____13. If a price of resources fall, supply will

1. decrease3. fluctuate

2. increase4. stabilize

_____14. Which of the following is a government tool that can cause the supply of goods and services to shift?

1. taxes3. regulations

2. subsidies4. all of the above

_____15. Competition in a market tends to

1. decrease supply3. increase supply

2. cause supply to fluctuate4. have little effect on supply

_____16. Nonprice determinants of supply include

1. supplies curves, government tools, & producer expectations

2. prices of resources, government tools, & competition

3. prices of resources, technology, & profit

4. prices of related goods, taxes, & supply schedules

_____17. According to the law of ______, producers will supply fewer goods at lower prices and more goods at higher prices

1. depreciation3. supply

2. demand4. subsidation

_____18. Gold is an example of a good that has

1. negative returns3. elastic supply

2. inelastic supply4. diminishing returns

_____19. A business makes a profit when its costs of production are less then its

1. overhead3. variable costs

2. revenues4. fixed costs

_____20. Which of these is not a determinant of supply?

1. government subsidies3. competition

2. prices of resources4. consumer expectations

_____21. The lessening in value of capital goods is called

1. depreciation3. overhead

2. marginal costs4. revenues

_____22. When a surplus exists in a market, price is

1. above equilibrium3. higher than quantity supplied

2. below equilibrium4. lower than quantity supplied

_____23. The minimum wage is an example of a

1. price floor3. black market

2. price ceiling4. rationing system

_____24. Which of these is not an example of a limitation of the price system?

1. pollution created by manufacturing

2. national defense

3. natural disasters cause instable in prices

4. the efficiency of the price system

_____25. Which of the following is an example of a public good?

1. national defense3. college education

2. malls4. housing

_____26. What is the main form of communication between producers and consumers in a free-enterprise market?

1. information3. the media

2. prices4. market failure

_____27. If a company lowers the price of a good with elastic demand, there will be a

1. slight fall of demand for that product

2. large increase in the quantity demanded

3. slight increase in the quantity supplied

4. large rise in the demand for that good

_____28. The law of ______states that an increase in a good’s price causes a decrease in the quantity demanded

1. depreciation3. supply

2. demand4. subsidation

_____29. A person not receiving as much satisfaction out of eating their 7th hot dog as they did eating their 1st hot dog is an example of

1. depreciation3. rationing

2. diminishing marginal utility4. elastic supply

_____30. Which of the following is not a determinant of demand?

1. Income3. Market size

2. Producer expectations4. Prices of related goods

_____31. What causes producers to vary their supply of goods & services by wanting to supply more at higher prices?

1. depreciation 3. profit motive

2. variable costs 4. price floors

_____32. What was the key state profiled in the USA Today as the key state in the upcoming Presidential election?

_____33. Why was George Tenet resigning as the head of CIA?

_____34. Why will the Presidential election be decided in 17 states?

_____35. What state was Ronald Reagan born in?