Unit Test Review Microeconomics

Which statements correctly explain price floors and price ceilings? Check all that apply.

3-Price floors help producers by raising prices. 4-Price ceilings help consumers by lowering prices. 5-Effective price floors are set above equilibrium. 6-Effective price ceilings are set below equilibrium.

Which statement best explains the role of producers in economics?

A. Producers supply goods and services.

If supply for a product is low but demand is high, what most likely needs to happen to achieve equilibrium?

C. The supply needs to be raised.

In which way do producers try to differentiate themselves in monopolistic competition?

C. product features

A possible result of disequilibrium is

A. excess demand.

The highest amount a landlord can charge for rent is an example of

C. a price ceiling.

What most likely will happen if the pie maker bakes a seventh pie?

B. The marginal cost will most likely increase to $2.00

What most likely will happen if the pie maker continues to make additional pies?

A. The marginal costs will continue to rise, increasing the total cost, while the marginal revenue remains the same, decreasing the profit.

Look at the chart comparing the price of graphic T-shirts to the quantity supplied.
This chart is an example of a

D. supply schedule.

Which quality best describes a producer with an absolute advantage?

A. efficient

Motherboards, Inc., manufactures computer parts. The company’s total revenue is

D. the amount the company receives from the sale of all of its computer parts.

According to the graph, the marginal cost begins to increase when the producer makes

C. four pies.

Excess supply is created when price or move away from the equilibrium point.

quantity

Which food truck has the absolute advantage?

D. Lunch on the Go

Equilibrium occurs when supply and demand coordinate to

B. set prices and production.