ScholarMatic: Explanation & Answer
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Economics 372 Assignment 1 ___ 1. In the circular flow model, the business sector _____ goods and services in _____
markets.
a.
demands; product
c.
supplies; product
b.
demands; resource
d.
supplies; resource
___ 2. In the circular flow model, the household sector _____ goods and services in _____
markets.
a.
demands; product
c.
supplies; product
b.
demands; resource
d.
supplies; resource
___ 3. In the circular flow model, the business sector _____ the factors of production (inputs) in _____
markets.
a.
demands; product
c.
supplies; product
b.
demands; resource
d.
supplies; resource
___ 4. In the circular flow model, the household sector _____ the factors of production (inputs) in
_____ markets.
a.
demands; product
c.
supplies; product
b.
demands; resource
d.
supplies; resource
___ 5. Which of the following would best explain an increase in the demand for jeans?
a.
A decrease in income, assuming jeans are normal goods
b.
A decrease in the popularity of jeans
c.
An increase in the number of schools that allow students to wear jeans
d.
A decrease in the price of jeans
___ 6. An increase in the demand for oranges is expected to cause:
a.
an increase in the price of an orange.
b.
an increase in the number of oranges consumed.
c.
an increase in the number of oranges sold.
d.
all of the above.
___ 7. According to the law of supply, an increase in the price of cell phones causes:
a.
an increase in the quantity of cell phones supplied.
b.
an increase in the demand for cell phones.
c.
a decrease in the supply of cell phones.
d.
A decrease in the quantity of cell phones demanded.
___ 8. When a market is in equilibrium:
a.
quantity supplied exceeds quantity demanded.
b.
quantity demanded exceeds quantity supplied.
c.
quantity demanded equals quantity supplied.
d.
there is either a shortage or a surplus. Use the data below to answer questions 9 – 10:
Consumption Expenditures (C)
Investment Expenditures (I)
Government Expenditures (G)
Exports (EX)
Imports (IM)
Depreciation $12,100 billion
$2,800 billion
$3,200 billion
$2,500 billion
$2,760 billion
$2,200 billion ___ 9. Gross Domestic Product (GDP) is equal to ________.
a.
$22,800 billion
b.
$25,560 billion
c.
$19,760 billion
d.
$17,840 billion
___ 10.Net exports are equal to __________.
a.
$5,260 billion
b.
–$260 billion
c.
– $560 billion
d.
$2,500 billion
ScholarMatic: Explanation & Answer
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