WGU D089 Principles of Economics Test 100% Accurate
Question :Which type of economy is characterized by a
government that plans and controls all economic activity?
Correct answer:Command
Question :What is an example of a normative economic
statement?
Correct answer:Marginal tax rates should be lowered on high-
income individuals.
Question :Which characteristic is associated with natural
resources from a business perspective?
Correct answer:They exist without human effort.
Question :How can the available supply of natural resources
be increased?
Correct answer:Discovering new ways to extract resources
Question :A ski resort sells tickets online at $70 per ticket.
The resort is not selling many tickets, so it offers a two-for- one opportunity. Which economic principle is being used?
Correct answer:People respond to incentives.
Question :What are the characteristics of the production
possibility frontier graph?
Correct answer:Trade-offs in choices and downward sloping
Question :How is scarcity represented on the production
possibility frontier?
Correct answer:By there being attainable and unattainable
points
Question :The government imposes new safety regulations on
the production of gas stoves. What will happen in the market for gas stoves?
Correct answer:Supply decreases.
Question :The price of steel has increased by 5%, which leads
to an increase in quantity supplied by 8%. Which outcome can be concluded from the demand and supply of steel?
Correct answer:The supply of steel is elastic.
Question :An individual wants to sell a car that frequently
requires costly repairs. Although the car performs worse and requires more repairs than similar products, the seller hopes to get a price equal to better performing cars since the buyers will not know about the problems. Why is this seller able to charge a price equal to other sellers?
Correct answer:Asymmetric information
Question :Which market failure is overcome by a money-back
guarantee strategy using mail-order catalogs?
Correct answer:Imperfect information
Question :Why do high labor-cost countries typically have
more capital than low labor-cost countries?
Correct answer:Firms choose technology that requires more
capital than labor to offset higher labor costs.
Question :A bakery operates in an industry with many
competitors and easy entry and exit. The firms in the industry are price takers. What is the price elasticity of demand for the bakery's bread?
Correct answer:Perfectly elastic
Question :A firm is operating in an environment with other
firms who differentiate their products with advertisements.The firm finds that its long-run economic profits equal zero.Which market environment is this firm operating in?
Correct answer:Monopolistic competition
Question :The market share of the top four firms was
measured, and the concentration ratio score indicated that a proposed merger would draw the attention of anti-trust authorities. Which concentration ratio score was calculated?
Correct answer:58%
Question :Who is included in the labor force participation
rate?