Question1

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A change in the price of a product will cause:

Select one:

a.a shift in the supply curve

b.a change in quantity supplied

c.a change in demand for a product

d.a change in consumer preferences

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Question2

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A market is in equilibrium:

Select one:

a.at all prices above that shown by the intersection of the supply and demand curves

b.provided there is no surplus of the product

c.if the amount that producers want to sell is equal to the amount that consumers to buy

d.whenever the demand curve is downward-sloping and the supply curve is upward-sloping

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Question3

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A price ceiling means that:

Select one:

a.government is imposing a legal price that is below the equilibrium price

b.government is imposing a legal price that is above the equilibrium price

c.sellers are trying to impose a minimum price to raise their revenues

d.the relevant product is currently available in excess supply

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Question4

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A price floor means that:

Select one:

a.some sellers are artificially restricting supply in order to raise prices

b.inflation is severe in this particular market

c.government is imposing a legal price that is below the equilibrium price

d.government is imposing a legal price that is above the equilibrium price

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Question5

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A product has utility if it:

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a.satisfies consumer wants

b.is useful

c.takes more and more resources to produce successive units of it

d.can be produced in unlimited quantities

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Question6

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A rightward shift in the demand curve for product C might be caused by a(n):

Select one:

a.increase in the price of a product that is complementary to C

b.increase in the price of a product that is a substitute for C

c.increase in income if C is an inferior good

d.decrease in income if C is a normal good

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Question7

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An economist who says that consumer wants are inexhaustible means that:

Select one:

a.the nature of consumer wants is highly unpredictable

b.economic resources -- natural, capital, and human resources, are scarce

c.economic resources are valuable only because they can be used to produce consumer goods

d.consumer wants are virtually unlimited and, therefore, incapable of being fully satisfied

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Question8

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An increase in demand means that:

Select one:

a.the price of the product has risen, so consumers move up to a new point on the demand curve

b.the quantity demanded at every price is greater than before

c.the quantity demanded at every price is less than before

d.the price of the product has fallen, so consumers move down to a new point on the demand curve

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Question9

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An increase in the wages of construction workers will:

Select one:

a.decrease the average annual incomes of construction workers

b.shift the demand curve for construction workers to the right

c.shift the supply curve of new homes to the left

d.lead to an increase the quantity supplied of new homes

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Question10

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Any point inside the production possibilities curve indicates:

Select one:

a.that resources are imperfectly shiftable among alternative uses

b.that the economy is saving a part of its income

c.that more output could be produced with available resources

d.the presence of inflationary pressures

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Question11

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At the point where the demand and supply curves for a product intersect:

Select one:

a.either a shortage or a surplus of the product might exist, depending upon the degree of competition

b.the quantity that consumers want to purchase and the amount producers choose to sell are the same

c.the market may, or may not, be in equilibrium

d.the "selling price" and the "buying price" need not to be equal

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Question12

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Cuba is an example of a:

Select one:

a.mixed free enterprise

b.free enterprise system

c.centrally planned economy

d.none of the above

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Question13

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Economics can best be described as the study of how:

Select one:

a.to distribute limited resources among alternative ends

b.government policies affect businesses and labour

c.to manage business enterprises for profit

d.profitably to invest one's income in stocks and bonds

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Question14

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Economists use the term demand to refer to:

Select one:

a.the total amount spent on a particular product over a given time period

b.the relationship between the various possible prices of a product and the quantities that consumers are willing to purchase at each price

c.a particular price-quantity combination on a demand curve

d.the amount of a product that consumers are willing to purchase at a certain price

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Question15

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Given a downward-sloping demand curve and an upward-sloping supply curve for a product, a decrease in the price of a complementary good will:

Select one:

a.decrease equilibrium price and quantity

b.decrease equilibrium price and increase equilibrium quantity

c.increase equilibrium price and decrease equilibrium quantity

d.increase equilibrium price and quantity

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Question16

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If Sprite and 7-Up are substitutes, a fall in the price of Sprite, other things being equal, will cause the demand curve for 7-Up to:

Select one:

a.shift upward to the right

b.slope upward from left to right

c.none of the above

d.shift downward to the left

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Question17

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Macroeconomics approaches the study of economics from the viewpoint of:

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a.entire economic sectors

b.governmental units

c.specific product and resource markets

d.individual consumers

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Question18

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Microeconomics is concerned with the:

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a.total levels of income, employment, and output

b.behaviour of specific segments of the economy

c.behaviour of individual participants in various markets

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Question19

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One advantage of a centrally planned economy is:

Select one:

a.the profit motive forces firms to be efficient

b.it has the ability to maintain full employment

c.individuals are able to exercise freedom of choice

d.competition is allowed and benefits the consumer in terms of lower prices

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Question20

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Quantity demanded refers to the:

Select one:

a.minimum amount of a product that a consumer purchases to continue collecting social assistance

b.independent variable in the relationship between price and quantity demanded

c.amount of a product that consumers would be willing to purchase if they only had the income to afford it

d.amount of a product that consumers are willing to purchase at a certain price

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Question21

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Refer to the below information. Equilibrium price will be

The data is at the end picture

Select one:

a.$2

b.$1

c.$4

d.$3

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Question22

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The Canadian economy most closely approximates a:

Select one:

a.market economy

b.traditional mixed economy

c.modern mixed economy

d.command economy

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Question23

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The economic problem is essentially one of deciding how to make the best use of:

Select one:

a.limited resources to satisfy unlimited wants

b.unlimited resources to satisfy limited wants

c.limited resources to satisfy limited wants

d.unlimited resources to satisfy unlimited wants

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Question24

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The factors of production include:

Select one:

a.natural resourced, labour, management, time

b.natural resources, labour, production, management

c.land, labour, capital, management

d.land, labour, product and price

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Question25

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The fundamental problem of economics is:

Select one:

a.the scarcity of productive resources relative to consumer wants

b.to establish prices that accurately reflect the relative scarcities of products and resources

c.to establish equity between personal and business taxation

d.to establish a democratic political framework for the provision of social goods and services

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Question26

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The law of demand states that:

Select one:

a.consumers buy more of a given product at high prices than they buy at low prices

b.price and quantity demanded are inversely related

c.the larger the number of buyers in a market, the lower the price of the product

d.price and quantity demanded are directly related

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Question27

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The law of diminishing marginal utility states that:

Select one:

a.additional units of a given product yield less and less extra satisfaction to a consumer

b.price must be lowered to induce firms to supply more of a product

c.total utility is maximized when consumers obtain the same amount of utility per unit of each product consumed

d.it takes increasingly larger amounts of resources, beyond a particular point, to produce successive units of a product

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Question28

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The law of supply indicates that:

Select one:

a.producers will offer more of a product at high prices than they will at low prices

b.the supply curve is downward-sloping

c.consumers will purchase less of a good at high prices than they will at low prices

d.producers will offer more of a product at low prices than they will at high prices

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Question29

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The price elasticity of demand indicates:

Select one:

a.how far business executives can stretch their fixed costs

b.the extent to which consumers respond to a change in price

c.the slope of the demand curve

d.the extent to which a demand curve shifts as income changes

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Question30

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The price elasticity of supply measures how:

Select one:

a.easily labour and capital can be substituted for one another in the production process

b.responsive the quantity supplied of Y is to changes in the price of X

c.responsive the quantity supplied of X is to changes in the price of X

d.responsive quantity supplied is to a change in incomes

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The scarcity problem

Select one:

a.persists because a society's consumer wants exceed its available economic resources

b.has been eliminated in all industrialized nations

c.has been eliminated in affluent societies such as Canada and the United States

d.persists only because contries have failed to achieve continual full employment

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Question32

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When an economist says that the demand for a product has increased, he or she means that:

Select one:

a.the product has become particularly scarce for some reason

b.consumers are now willing to purchase more of this product at every price

c.the demand curve has shifted to the left

d.the product's price has fallen and, consequently, consumers are buying a larger quantity of the product

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Which of the following expressions best states the idea of opportunity cost?

Select one:

a."All that glitters is not gold"

b."A penny saved is a penny earned"

c."there is no such thing as a free lunch"

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Question34

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Which of the following is a capital resource?

Select one:

a.a share of Microsoft stock

b.a savings account

c.a dump truck

d.a pair of stockings

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Question35

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Which of the following products is most likely to have an elastic demand?

Select one:

a.cigarettes

b.toothpicks

c.automobiles

d.insulin