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Introduction to Economics quiz #18

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  • Relationship of substantial reward compared to the amount of risk taken
    Risk-return tradeoff.
  • What best describes what a supply chain is (Everfi)?
    A network for producing and delivering products.
  • Are those buyers who want to be the first on the block to have a new product or service.
    Innovators.
  • Individuals have the right to decide what to buy, when to buy it, and how to use it.
    True.
  • Karl Marx was an influential German thinker and revolutionary who pioneered the idea of ______.
    Communism.
  • Communist countries usually have ______ economies.
    Command.
  • An increase in the international value of the United States dollar will most likely benefit
    U.S. consumers buying imports.
  • Health care, business, retail, and education are examples of ________ industries.
    Service.
  • What item is found in all economic systems?
    Scarcity.
  • The loanable funds market is best described as bringing together
    Savers and borrowers.
  • Buying and selling products online is called ____________.
    E-commerce.
  • What is the best reason for studying economics?
    To make informed decisions.
  • ______ comes in the form of wages, interest, rent, profit, and even from government programs.
    Income.
  • Which best describes the nature of cause and effect in the context of the business cycle
    Changes in demand and production cause fluctuations.
  • Anything that can be bought or sold.
    A good or service.
  • What happens to purchasing power during times of rising prices?
    Purchasing power increases.
  • What is the expected return on a security with beta of 1?
    Equal to the market return.
  • Of the options listed below, which is the best example of systematic risk?
    Economic recession.
  • What is the goal when companies concentrate on a single industry?
    Specialization and efficiency.
  • In a market economy, who makes the decisions that guide most economic activity?
    Consumers and producers.
  • What often occurs when a new firm enters an industry?
    Increased competition and lower prices.
  • What is true of a traditional economy?
    It relies on customs and traditions.
  • In the United States, what is the primary reason people go without nourishing meals?
    Limited income.
  • What is an example of vertical integration?
    A manufacturer buying its supplier.
  • Which items represent examples of Adam Smith’s 'invisible hand' at work?
    Competition and self-interest benefiting society.
  • What is a disadvantage faced by first movers in an industry?
    High costs and risk of failure.
  • Are households primarily buyers or sellers in the goods and services market? In the labor market?
    Buyers in goods market, sellers in labor market.
  • What are some disadvantages of being a first-mover?
    High costs and uncertainty.
  • What was an essential premise of the idea of mercantilism?
    National wealth depends on trade surplus.
  • What is an example of a retail store?
    A clothing shop.
  • What are disadvantages of being a first-mover?
    High costs and risk of failure.
  • What is the correct definition of price fixing?
    Collusion to set prices above market levels.
  • What is true about economic fluctuations?
    They are normal in market economies.
  • What is classified as investment in national income (GDP) accounting?
    Purchasing new equipment.
  • What example was used by the authors to explain economics?
    Buying and selling goods.
  • Economic cost can best be defined as
    The value of resources used, including opportunity cost.
  • A natural monopoly exists when
    One firm can supply the market at lower cost than multiple firms.
  • Cost-plus pricing occurs when
    A firm adds a markup to production cost.