Question 1 Which of the following best addresses the economic question For whom to produce? (5 points) Compass Learning Group contracts a team from India to write a course. Head Tome runs a social networking site with incorporated advertising. Lady Zigzag's agent makes concert tickets available on a new smartphone app. InFocus conducts focus groups to determine its target market. Question 2 Jen is starting a nonprofit store. She plans to sell handmade African scarves and jewelry. Which economic question(s) would Jen still need to answer? (5 points) For whom to produce? How to produce? What to produce? and For whom to produce? What to produce?and How to produce? Question 3 Which of the following addresses all three of the basic economic questions? (5 points) You start your own lunch delivery service serving area businesses and featuring all organic meals baked in your home. You start a wedding planning business and advertise your services online. You decide to work from home using your existing office as your headquarters. You launch a nanny-referral service focusing on young, working families in your community. Question 4 Devon enters his poem in a nationwide contest, rather than joining his friends at a football game. Which would be a long-term benefit of his choice? (5 points) Getting extra credit in his literature class Saving money on food concessions at the game Watching his favorite team win the championship Winning a scholarship for his writing Question 5 Use the cost-benefit analysis table to answer the question: Should Mrs. Baxter allow her students to take an open-book test? Which of the following would best fill the blank space? (5 points) Mrs. Baxter will have to make the test harder. Parents may complain about grades. Students may not bring their books to class. Students will be happier with Mrs. Baxter. Question 6 Use the cost-benefit analysis table to answer the question: Should Philip customize his motorcycle? Philip is thinking about customizing his motorcycle. A paint job, saddlebags, and a radio would cost $600. His motorcycle is older, so he also knows that he will need to get another motorcycle sometime in the next two years. He creates a cost-benefit analysis table to examine his choices. What statement would best complete the chart, and why? (5 points) He will be able to drive his motorcycle on his upcoming vacation. He will be able to lengthen the life of his motorcycle. He will temporarily have less money in his bank account. He will spend more time with friends during the repairs. Question 7 Yao's Asian Market sells dragon fruit for $3 each. The store usually sells 20 dragon fruits a week. Dragon fruit is in season, and the market could maintain a steady delivery. The produce manager decides to have a sale on dragon fruit and reduces the price to $2 each. Which of these would happen? (5 points) The demand would not keep up with the supply. The supply would not keep up with the demand. The quantity demanded would decrease. The quantity demanded would increase. Question 8 Which statement best interprets the graph? (5 points) As the quantity demanded decreases, the price increases. As the quantity demanded increases, the price remains the same. As the price decreases, the quantity demanded increases. As the price increases, the quantity demanded increases. Question 9 Use the above graph to answer the following question. Which line indicates an increase in demand? (5 points) 1 2 3 4 QUESTION 10 A vendor makes a new smartphone and presells four thousand units for $300 each. The factory has the capacity to produce one thousand smartphones per month. Anticipated sales are five hundred units per month. Which of these would occur during the first few months of sales? (5 points) Limited demand would increase the price. Limited supply would increase the price. Unlimited demand would decrease the price. Unlimited supply would decrease the price. QUESTION 11 Creative Commons Attribution-Share Alike 3.0 Unported Look at the graph. Where P is price and Q is quantity, how are point A and line S related? (5 points) Point A is the quantity supplied at a given price; line S represents the demand. Point A is the quantity supplied at a given price; line S represents the total supply. Point A is the quantity demanded at a given price; line S represents total supply. Point A is the quantity demanded at a given price; line S represents the equilibrium price. QUESTION 12 If the x-axis is Quantity and the y-axis is Price, what does the 85 in point (85, 5) represent? (5 points) The quantity supplied at time 1 The quantity supplied at time 2 The price at time 1 The price at time 2 QUESTION 13 An increase in demand causes the demand curve to (5 points) shift to the left shift to the right increase its slope decrease its slope QUESTION 14 When Hurricane Katrina shut down many oil refineries, the supply curve for oil (5 points) shifted to the left shifted to the right stayed the same became equal to zero QUESTION 15 The supply and demand curves show data for trendy smartphone covers. How would the graph change if the producer hired a popular actor as spokesperson for the product? (5 points) Add D2 to the right of D, showing a decrease in demand and increase in equilibrium price. Add D2 to the right of D, showing an increase in demand and increase in equilibrium price. Add D2 to the left of D1, showing a decrease in demand and decrease in equilibrium price. Add D2 to the left of D1, showing an increase in demand and decrease in equilibrium price. QUESTION 16 Which may occur as a result of a decrease in the price of laptop computers? (5 points) Increase in demand Increase in quantity demanded Decrease in demand Decrease in quantity demanded QUESTION 17 Creative Commons Attribution-Share Alike 3.0 Unported, and Creative Commons Attribution-Share Alike 2.5 Generic license The supply and demand curves reflect the availability and cost of a new gaming system. The producer announces that the new system will be compatible with existing games under the same brand. Which change will most likely occur to the graph? (5 points) Demand will shift left, lowering the market price. Demand will shift right, raising the market price. Supply will shift right, lowering the market price. Supply will shift left, raising the market price. QUESTION 18 Sam takes a five-dollar bill from his wallet. He exchanges the bill for four quarters and four one-dollar bills. He then uses the change to buy a bottle of water from a vending machine. Which characteristics of money has Sam best demonstrated? (5 points) Acceptability, divisibility, and portability Divisibility, scarcity, and stability of value Durability, portability, and standard Medium, scarcity, and value