Study Guide Final Exam Ap micro

Front

With respect to the circular flow model, businesses provide households with which of the following?
- taxes and interest
- labor and taxes
- goods, services, and incomes
- public goods and transfer payments

Back

goods, services, and incomes

Front

A volcano erupts in Hawaii that destroys or damages many of the orchards that supply the U.S. with pineapples. What will be the effect on price and quantity of pineapples sold, assuming all else is equal?

Back

Price will rise but quantity will drop.

Front

A market that has few barriers to entry, in which products that are not of identical quality and style are sold, and, therefore, firms can make greater-than-normal profits for short periods of time, is BEST described as

Back

monopolistically competitive

Front

A breakthrough in nanotechnology allows silicon chips for computers to be produced much more quickly and cheaply. If demand for computers remains unchanged, what will be the effect upon market price and supply?

Back

The supply will rise while the price falls.

Front

All of the following are characteristics of perfectly competitive markets EXCEPT: production is similar in quality, there is a large number of buyers and sellers, there are few barriers to entering the market.

Back

the firm's prices are kept confidential.

Front

A minimum price consumers are required to pay for a good or service.

Back

Price Floor

Front

A maximum price consumers are required to pay for a good or service.

Back

Price Ceiling

Front

The level of profit-maximizing output is reached when marginal cost is

Back

equal to marginal revenue

Front

Rent payments and property taxes would be counted as

Back

fixed costs

Front

According to the Profit Maximizing Formula, how many units should this firm produce?

Back

4