1
Created by Boundless
What is a primary characteristic of a market system?
A
The market system is competitive and focuses on seller
interests.
B
The market focuses on making the largest profit possible
without regard to consumer needs.
C
The market is competitive and focuses on consumer
interests.
D
The market system is competitive and balances seller and
consumer interests
2
Created by Boundless
On a demand and supply curve graph, consumer surplus is found (1)____ and
(2)____. Producer surplus is found (3)____ and (4)____.
A
(1) above the supply curve,(2) under equilibrium price,(3)
under the demand curve, (4) above equilibrium price
B
(1) along the demand curve,(2) greater than the equilibrium
price,(3) along the supply curve, (4) less than equilibrium
price
C
(1) under the demand curve,(2) above equilibrium price,(3)
above the supply curve, (4) under equilibrium price
D
(1) along the demand curve,(2) is equal to equilibrium price,
(3) along the supply curve, (4) is equal to equilibrium price
3
Created by Boundless
Fill in the blank. The gains from trade enables _______________ the production
possibility frontier.
A
Production inside
B
Consumption outside
C
Production outside
D
Consumption inside
4
Created by Boundless
Complete the sentence with the most suitable pairs of words: (1) is the only
sustainable way to consume outside the PPF curve and (2) allows us to shift the
PPF curve outward in the long run.
A
Efficiency (1); trade (2)
B
Technology (1); efficiency (2)
C
Trade (1); technology (2)
D
Trade (1); efficiency (2)
5
Created by Boundless
Which of these determines the location of the production possibilities frontier?
6
A
Amount of raw materials available
B
Level of technology
C
Amount of labor available
D
All of these answers
Created by Boundless
The circular flow diagram illustrates the exhange between __________.
A
resources and payments
B
inputs and outputs
C
firms and households
D
goods and services
7
Created by Boundless
The production possibilities frontier illustrates ___________.
A
the factors of production employed by an economy
B
the different combinations of inputs that are used by an
economy
C
the price of outputs at a given leve
D
the different combinations of outputs that can be produced
by an economy