ch 7 and 11

Question 1

Pure competition is characterized by all of the following EXCEPT

Answer 1

small number of buyers and sellers.

Question 2

What type of monopoly is the result of the location of abusiness firm?

Answer 2

geographic monopoly

Question 3

Monopolistic competition is separated from pure competition by

Answer 3

product differentiation

Question 4

All of the following are major types of market structures EXCEPT

Answer 4

collusion

Question 5

Oligopoly is a market situation with a great deal of

Answer 5

interdependence among firms

Question 6

Market situation in which there are only a few very largesellers of a product.

Answer 6

oligopoly

Question 7

Market situation in which there is only one seller of aproduct that has no close substitutes.

Answer 7

monopoly

Question 8

Situation in which large size leads to efficiency

Answer 8

economies of scale

Question 9

Philosophy that Government should not interfere with commerce

Answer 9

Laissez-faire

Question 10

Market situation in which a large number of independentand well-informed buyers and sellers deal with identicalproducts.-

Answer 10

pure competition

Question 11

All of the following may lead to a market failure EXCEPT

Answer 11

resource mobility

Question 12

Which of the following is an example of a public good?

Answer 12

main street

Question 13

What is the result of inadequate competition?

Answer 13

any of the above

Question 14

Which of the following is an example of resource mobility?

Answer 14

an engineer taking a job at a different factory

Question 15

Why is adequate information needed by the buyers and sellers in a market?

Answer 15

information is needed to make economic decisions

Question 16

Economic side effect that harms a third party

Answer 16

negative externality

Question 17

Economic side effect that benefits a third party

Answer 17

positive externality

Question 18

Economic side effect that affects a third party

Answer 18

externality

Question 19

Situation when a market fails to perform as expected and problems develop.

Answer 19

market failure

Question 20

Products that are collectively consumed by the population

Answer 20

public good

Question 21

Legally formed combination of corporations or companies

Answer 21

trust

Question 22

1890 act designed to “protect trade and commerce against unlawful restraints and monopoly”

Answer 22

Sherman Antitrust Act

Question 23

Order requiring a company to stop an unfair business practice

Answer 23

cease and desist order

Question 24

Practice of charging customers different prices for the same of the same product.

Answer 24

price discrimination

Question 25

Requirement that businesses reveal information to thepublic

Answer 25

public disclosure

Question 26

Which of the following antitrust laws was enacted first?

Answer 26

Sherman Antitrust Act

Question 27

Why are trusts regulated by the government?

Answer 27

to promote competition

Question 28

The Federal law that forbade rebates and discounts on the sale of goods to large buyers unless rebates and discounts were available to all

Answer 28

Robinson-Patman Act

Question 29

Public disclosure supports competition by

Answer 29

providing buyers and sellers with information

Question 30

Government participation in the American economy is designed to

Answer 30

eliminate or reduce market failures

Question 31

A __________ economy is a moneyless economy that relies on trade.

Answer 31

barter

Question 32

A __________ is something accepted by all parties as payment for goods and services.

Answer 32

medium of exchange

Question 33

To be successful, money must be __________.

Answer 33

portable, durable, divisible, and limited in supply

Question 34

Money functions as all of the following EXCEPT

Answer 34

a monetary standard

Question 35

Any substance that functions as a medium of exchange, ameasure of value, and a store of value

Answer 35

money

Question 36

What is the origin of the American dollar?

Answer 36

the Spanish peso and Austrian taler

Question 37

To be successful medium of exchange, money must be all ofthe following EXCEPT

Answer 37

easily available

Question 38

Expression of worth and a function of money

Answer 38

measure of value

Question 39

Money in the form of coins

Answer 39

specie

Question 40

Under what monetary standard does the United States currently operate?

Answer 40

The inconvertible fiat money standard

Question 41

All of the following currencies were in use after the Civil War EXCEPT

Answer 41

state bank notes

Question 42

Which of the following statements about gold standard is FALSE?

Answer 42

nder the gold standard, it is easier to expand the money supply.

Question 43

Which of the following statements about money in the United States is FALSE?

Answer 43

The United States money supply is convertible into gold.

Question 44

A fiat currency that must be accepted in payment for debts

Answer 44

legal tender

Question 45

Mechanism designed to keep the money supply portable,durable, divisible, and stable in value.

Answer 45

monetary standard

Question 46

Monetary standard under which the basic unit of currency is equivalent to and can be exchanged for a set amount of gold.

Answer 46

gold standard

Question 47

All of the following are requirements of a bank joining the national banking system EXCEPT

Answer 47

The bank must charter under a state or federal government.

Question 48

Each of the following is an example of a depository institution except

Answer 48

The Federal Deposit Insurance Corporation

Question 49

System that allows banks to obtain charters from either state or the federal government.

Answer 49

dual banking system

Question 50

System that functions as the central bank of the United States.

Answer 50

federal reserve system