Activity 13: Unit One Test (CIA4U)

1. A change in the price of a product will cause:

a shift in the supply curve

2. A market is in equilibrium:

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

3. A price ceiling means that:

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

4. A price floor means that:

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

5. A product has utility if it:

satisfies consumer wants

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

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

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

consumers wants are virtually unlimited and, therefore, incapable of being fully satisfied

8. An increase in demand means that:

the quantity demanded at every price is greater than before

9. An increase in the wages of construction workers will:

shift the supply curve of new homes to the left

10. Any point inside the production possibilities curve indicates:

that more output could be produced with available resources

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

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

12. Cuba is an example of a:

centrally planned economy

13. Economics can best be described as the study of how:

to distribute limited resources among alternative ends

14. Economists use the term demand to refer to:

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

15. 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:

increase equilibrium price and quantity.

16. 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:

none of the above

17. Macroeconomics approaches the study of economics from the viewpoint of:

entire economic sectors

18. Microeconomics is concerned with the:

behaviour of individual participants in various markets

19. One advantage of a centrally planned economy is:

the profit motive forces firms to be efficient

20. Quantity demanded refers to the:

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

21. The Canadian economy most closely approximates a:

modern mixed economy

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

limited resources to satisfy unlimited wants

23. The factors of production include:

land, labour, capital, management

24. The fundamental problem of economics is:

the scarcity of productive resources relative to consumer wants

25. The law of demand states that:

states that price and quantity demanded are inversely related.

26. The law of diminishing marginal utility states that:

beyond some point additional units of a product will yield less and less extra satisfaction
to a consumer.

27. The law of supply indicates that:

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

28. The price elasticity of demand indicates:

the extent to which a demand curve shifts as income changes

29. The price elasticity of supply measures how:

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

30. The scarcity problem

persists because a society's consumer wants exceed its available economic resources
31. When an economist says that the demand for a product has increased, he or she means
that:

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

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

"there is no such thing as a free lunch"

33. Which of the following is a capital resource?

a dump truck

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

automobiles