Economics

Question 1 (Multiple Choice Worth 5 points)

(03.02 MC)<object:standard:ss.912.e.1.1>

Your friend wants to open a hamburger stand. A necessary labor resource is

 a truck

 ground beef

 a grill

 a chef

Question 2 (Multiple Choice Worth 5 points)

(03.06 MC)<object:standard:ss.912.e.1.2>

© FLVS 2013

Use this image to answer the following question. The ice cream shop

 wants to produce mostly chocolate ice cream

 wants to produce mostly strawberry ice cream

 would operate inefficiently if it produced 6 gallons of both flavors

 is most efficient when it produces 2 gallons of strawberry ice cream

Question 3 (Multiple Choice Worth 5 points)

(03.05 HC)<object:standard:ss.912.e.1.7>

Marginal Cost Analysis Chart: ProPhone BlazerQuantity of JacketsPrice (in whole dollars)Total RevenueMarginal RevenueTotal CostMarginal CostProfit (or loss)022000900 120020020017080 218036016020030 316048012029090 415060012034050 514070010040060 613581090500100 7130910100620120 

The owner of ProPhone has charted the company’s marginal revenue and marginal cost for its latest line of smartphones, the Blazer. Use the chart to calculate the company’s profit. If ProPhone sells four phones, the company will

 break even

 lose money

 maximize profits

 make some profit

Question 4 (Multiple Choice Worth 5 points)

(03.04 MC)<object:standard:ss.912.e.1.6>

Why do monopolies and oligopolies benefit producers over consumers?

 Companies control price through demand.

 Competition is driven by factors other than price.

 Demand influences production more when competition is less.

 Few producers can generally control prices.

Question 5 (Multiple Choice Worth 5 points)

(03.03 MC)<object:standard:ss.912.e.1.5>

Your friend hopes to expand her business to multiple locations. It would be best for her to create a

 limited liability company

 sole proprietorship

 corporation

 partnership

Question 6 (Multiple Choice Worth 5 points)

(03.06 MC)<object:standard:ss.912. e.1.9=””>

A university has just hired additional faculty and staff. Who of the following is most likely to earn the highest pay?

 Chemistry professor with a doctoral degree

 Economics graduate student teaching assistant

 Education lecturer with a master’s degree

 Classics department office manager with a bachelor’s degree

Question 7 (Multiple Choice Worth 5 points)

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Quantity of JacketsPrice (in whole dollars)Total RevenueMarginal RevenueTotal CostMarginal CostProfit (or loss)020     12020 18  21938 33  31854 43  41768 55  51680 68  61590 83  71498 101  813104 120  

Based on this chart, what is the marginal cost, in dollars, to produce two jackets?

 Five

 15

 18

 33

Question 8 (Multiple Choice Worth 5 points)

< style=”font-family: ‘Times New Roman’; font-size: medium; line-height: normal;”>(03.04 LC)<object:standard:ss.912.e.1.8>

The greatest goal in advertising is to convince us

 “wants” are unnecessary

 the firm has the best price

 a particular product is a “need”

 the product is the same as other firm’s products

Question 9 (Multiple Choice Worth 5 points)

(03.06 HC)<object:standard:ss.912.e.1.2>

© FLVS 2013

Mad Hatter Publishing specializes in genre fiction for young adults. A movie company decides to make an adaptation of one of its popular science-fiction novels. Currently, production at Mad Hatter is at point T. To which point or points is production likely to shift?

 Q or R

 R or V

 T or V

 V or Q

Question 10 (Multiple Choice Worth 5 points)

(03.06 MC)<object:standard:ss.912.e.1.2>

© FLVS 2013

Use this image to answer the following question. The ice cream shop needs 5 pounds of strawberries for every gallon of strawberry ice cream. The shop chose to produce 4 gallons of chocolate ice cream. How many pounds of strawberries should the shop purchase?

 24

 30

 40

 60

Question 11 (Multiple Choice Worth 5 points)

(03.04 MC)<object:standard:ss.912.e.1.8>

“Buy our cell phone with built-in calendar and reminder features! This way you will never forget an appointment while on the go.” This advertisement targets your

 fears

 rituals

 emotions

 social values

Question 12 (Multiple Choice Worth 5 points)

(03.01 LC)<object:standard:ss.912.e.2.3>

Samuel F.B. Morse patented the

 telegraph

 automobile

 audio recorder

 radio transmitter

Question 13 (Multiple Choice Worth 5 points)

(03.06 MC)<object:standard:ss.912.e.1.9>

A company will continue to hire workers until

 there is no more room in the facility

 the government restriction on workforce is reached

 the additional profit is less than the cost of hiring

 there is no more money available for capital investment

Question 14 (Multiple Choice Worth 5 points)

(03.06 MC)<object:standard:ss.912.e.2.5>

Marco works as a freelance science writer. He wants to improve his productivity. Which of the following steps is he most likely to take?

 Build a website highlighting his expertise and publications

 Take a week off to relax and play video games

 Invest in a better computer and a faster Internet connection

 Take out an advertisement for his services

Question 15 (Multiple Choice Worth 5 points)

(03.02 MC)<object:standard:ss.912.e.1.1>

Meg and her mother are opening a cupcake shop. They buy an oven, a walk-in cooler, and a decorating table. In terms of factors of production, what are these items?

 Capital

 Entrepreneurship

 Labor

 Land

Question 16 (Multiple Choice Worth 5 points)

(03.06 MC)<object:standard:ss.912.e.2.5>

Which of the following is the most profitable investment for a game shop earning $2 profit from every game sold?

 Vehicle with $120 daily operating cost, delivering 80 games per day

 Inventory software with $10 daily operating cost, saving 30 games per day from theft

 Game cleaning system with $5 daily operating cost, increasing sales by 15 games per day

 Electronic billboard with $20 daily operating cost, increasing sales by 20 games per day

Question 17 (Multiple Choice Worth 5 points)

(03.03 MC)<object:standard:ss.912.e.1.5>

Stefan has inherited a large amount of money and decides he wants to start a skateboard shop. He has money to invest up front, but he lacks business expertise. Which of the following would be his best business options, depending on what he is willing to risk?

 Corporation or sole proprietorship

 Limited liability company or corporation

 Partnership or limited liability company

 Sole proprietorship or partnership

Question 18 (Multiple Choice Worth 5 points)

(03.05 MC)<object:standard:ss.912.e.1.7>

Quantity of JacketsPrice (in whole dollars)Total RevenueMarginal RevenueTotal CostMarginal CostProfit (or loss)020     12020 18  21938 33  31854 43  41768 55  51680 68  61590 83  71498 101  813104 120  

Based on this chart, what is the marginal revenue, in dollars, at quantity five jackets?

 12

 13

 52

 64

Question 19 (Multiple Choice Worth 5 points)

(03.04 LC)<object:standard:ss.912.e.1.6>

A monopoly is a market for a good or service that

 has few competitive firms

 is perfectly competitive

 has one buyer

 has one seller

Question 20 (Multiple Choice Worth 5 points)

(03.06 MC)<object:standard:ss.912.e.2.5>

Which of the following is the most profitable investment for a candy shop that earns $1 profit per pound of candy?

 Worker at $10 per hour, producing eight pounds of candy per hour

 Worker at $12 per hour, producing 16 pounds of candy per hour

 Machine with $5 per hour operating cost, producing 10 pounds of candy per hour

 Machine with $8 per hour operating cost, producing 14 pounds of candy per hour