Macroeconomics

Which is NOT a characteristic of a monopoly?

• Seller sets the market price

• Firm sells a unique product

• One seller

• Entry into the market is easy

Perfect competition involves:

• Difficulty entering & exiting the market

• A large number of buyers & sellers

• Little information is available to buyers

• Sellers working together to set prices

What does it mean to be diversified?

• Having as much money in bonds as you do in stocks

• Having investments that react differently to market or economic events

• owning at least 20 stocks in whatever industry you think you own best

• having a financial advisor

What is the difference between a ROTH and a traditional retirement account?

• ROTH contributions are after-tax, while traditional retirement contributions are before tax

• ROTH contributions are pre-tax, while traditional retirement contributions are after tax

• ROTHs are for people who want a traditional retirement

When the supply of a product or service goes up and the demand stays the same the Price will typically do what?

• Rise

• Fall

• Stay the same

• Consumer

When the demand for a product or service is higher than the supply this causes what?

• shortage

• surplus

• consumer

• equilibrium

When a price ceiling is in place keeping the price below the market price, which is true of the quantity demanded & quantity supplied?

• Quantity Demanded is greater

• Quantity Demanded equals Quantity supplied

• Quantity Supplied is greater

What is the equilibrium quantity in this graph?

• $1.00

• $1.50

• 600

• 800

A disease has been affecting banana crops, and at the same time, consumers learn that bananas cure baldness. What will happen to the price and quantity of bananas?

• Price and quantity will rise

• Price will rise, while the quantity will fall

• Price will fall, while quantity change is unknown

• Price will rise, while the quantity change is unknown

The price of paper is rising and at the same time fewer people are reading paper books. In the market for books, what will happen to price and quantity?

• The change in price is unknown, but quantity will increase

• Price will rise and quantity will fall

• The change in price is unknown, but quantity will decrease

• Price will fall and quantity will rise