Econ 3NW Review

One result of competition in a free enterprise system is ----

• Fewer Consumer Choices

• Lower Prices for Products

• Increasing Wages and Income

• Improved Social Security Benefits

Which of the following is a basic characteristic of all economic systems?

• Price Controls

• Wage Incentives

• Small Business Owners

• Distribution of Goods and Services

The late twentieth century has been characterized by an increase in free trade agreements. Advocates of free trade argue that it results in

• Higher Unemployment

• Increased Immigration

• Lower Corporate Tax Rates

• Increased Economic Growth

Recently, the price of a popular perfume has increased by $10. How will the price change likely affect the quantity demanded and supplied?

• Supply will stay the same, and demand will increase

• Supply will decrease, and demand will increase

• Supply will increase, and demand will decrease.

• Supply will increase, and demand will stay the same.

In a competitive market, which action occurs when the price a consumer is willing to pay for a good goes up?

• Some companies will shift resources to make more of the good

• The government will subsidize the production of the good

• All companies will decide to produce alternate goods

• The amount of other goods purchased will also increase.

What type of market structure is described by the following info:

Few Sellers

Some control over price

High market entry barriers

Some product differentiation

• Natural Monopoly

• Oligopoly

• Pure Competition

• Monopolistic Competition

The market structure of pure competition is distinctive because ...

• Only one seller is needed in this market

• There are no examples of this type of market structure

• The sellers in this market have no control over price

• The are large barriers to entry

How do fluctuations to the international exchange rate of a nation's currency affect its balance of trade?

• If a country's exchange rate increases, the country can import goods less expensively

• If a country's exchange rate increases, the balance stays the same.

• If a country's exchange rate decreases, a negative trade balance occurs.

• If a country's exchange rate decreases, the balance stays the same.

With a given amount of resources, a country with a comparative advantage will produce a product with ...

• Decreased demand

• Cheaper natural resources

• Lower opportunity costs

• Higher quality specifications

Which of the following accounts for why countries specialize in particular trade products?

• Government regulations

• Unequal distribution of resources

• Variation in the size of markets

• Variety in the types of economic systems