Economics Test Review

What happens to a demand curve if consumer income increases.

A new technology makes it cheaper to produce smartphones. What happens to the supply curve?

• It shifts to the right

• It shifts to the left

• It remains unchanged

• It becomes vertical

Which of the following best represents an opportunity cost?

• Buying a phone and getting a free case

• Choosing to study instead of going out with friends

• Earning a paycheck for working overtime

• Selling a used car to buy a new one

Which of the following is an example of an entrepreneur?

• A farmer harvesting crops

• A teacher educating students

• A person starting their own online business

• A company buying new machines

If a country's real GDP increases, this means:

• Prices of goods have increased

• The economy has produced more goods and services

• The inflation rate has risen

• The unemployment rate is higher

If the U.S. GDP decreases for two consecutive quarters, what is the country experiencing?

• Inflation

• A recession

• A budget surplus

• Deflation

What happens to a supply curve shifts when raw material costs decrease?

• It shifts to the right

• It shifts to the left

• It remains unchanged

• It becomes vertical

Which of the following best represents an opportunity cost?

• Buying a phone and getting a free case
  

• Choosing to study instead of going out with friends

• Earning a paycheck for working overtime

• Selling a used car to buy a new one

Which definition best describes scarcity?

• Is a short-term, artificial condition

• Is a long-term, natural condition

• Is a temporary, natural condition

• Is a permanent, artificial condition

Scarcity is different from a shortage because scarcity:

• Can be eliminated with government intervention

• Is a long-term, natural condition

• Only applies to luxury goods

•  Happens when demand exceeds supply