How do we define opportunity cost?

the value of the next best alternative that is given up

Of the three fundamental questions of economics, which is one of these options?

how to produce goods and services

What does Point H represent?

An impossible level of production.

Mr. Goodwrench, an auto mechanic, requires capital resources. These are:

a garage, tools and a telephone

Which is the best definition of scarcity?

unlimited wants outpace limited resources

Consumer sovereignty is defined as ...

consumers choose which products will be produced

Why would the richest person in the world experience scarcity?

Because productive resources are limited.

An efficient economy is one in that ...

Uses its resources with very little waste.

Human capital is defined as:

the knowledge and skills that a labor resource possesses

What is the best characteristic of a mixed economy?

Government sets a minimum wage for private business.

Which choice is the correct example of opportunity cost?

Mr. King decides to buy a mule instead of new clothes.

In a market economy ...

prices reflect scarcity and wants

The study of economics is concerned with:

making choices to use scarce resources efficiently

What does the Production Possibilities Frontier tell us?

It shows the possible outcomes when two goods are produced.

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Economics Fundamentals

28 termsStudBud Administration232 plays

This is a Quiz to test our knowledge of the foundational ideas of #economics.

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Questions 28

Answers

1
How do we define opportunity cost?
all other alternatives you give up to do what you want
the value of the next best alternative that is given up
marginal cost for non-fraudulent exchanges
spending money on what you want
2
Two ways of allocating scarce resources are:
supply and demand, and leverage
supply and demand, and contest
authority and consensus
command and control
3
Of the three fundamental questions of economics, which is one of these options?
who will receive goods and services
how much goods and services will cost
how goods are allocated
how to produce goods and services
4
What does Point H represent?
Our long-term hopes and dreams.
An impossible level of production.
Nothing
The maximum amount we can produce right now.
5
Which choice is a capital factor of production?
Ms. Payne
steel
air conditioning
a computer
6
What is the opportunity cost if we move from Point C to Point B?
100,000 pizzas
300,000 pizzas
both pizzas and robots
7,000 robots
7
When one decision is made, the next-best alternative is:
comparative advantage
additive resource
opportunity cost
comparative disadvantage
8
The fundamental economic problem faced by all societies is ...
poverty
scarcity
unemployment
inequality
9
Mr. Goodwrench, an auto mechanic, requires capital resources. These are:
money, a garage and employees
a garage, tools and a telephone
customers, tools and land
a garage, lenders and customers
10
For a factor of production to be scarce, it must be...
rare and expensive
unevenly allocated
limited and desirable
unlimited and cheap
11
Which is the best definition of scarcity?
a shortage of goods
unlimited wants outpace limited resources
the allocation of goods and services
not having enough money to buy stuff
12
Which choice from factors of production is an example of LABOR?
sweat produced when working
mental activity when producing
goods and services that are produced
learning new skills
13
Consumer sovereignty is defined as ...
producers advertise goods and services
producers create demand for products
consumers choose which products will be produced
consumers determine how resources are allocated
14
Why would the richest person in the world experience scarcity?
Because prices are too high.
Rich people do not experience scarcity.
Because productive resources are limited.
Because workers wages keep going up.
15
An efficient economy is one in that ...
Makes a high profits for each product.
Has low levels of unemployment.
Uses its resources with very little waste.
Gets more work done in less time.
16
Human capital is defined as:
the number of people in the workforce
how much money someone earns
the knowledge and skills that a labor resource possesses
hiring new people
17
The term "land" in factors of production means ...
natural resources
unfinished goods
dirt
real estate
18
What is the best characteristic of a mixed economy?
Farmers engage in a barter economy.
Government sets a minimum wage for private business.
Scarcity is experienced by all.
All factories produce for the government's needs.
19
Which choice is the correct example of opportunity cost?
Teachers take on the extra duty of driving buses.
You make a toy from leftover popsicle sticks.
You buy a new jacket with birthday money.
Mr. King decides to buy a mule instead of new clothes.
20
In a market economy ...
governments interfere
governments intervene
governments plan production
prices reflect scarcity and wants
21
In a command economy, the key driver of the economy is...
entrepreneurs
the government
consumers
businesses
22
Profit motive is defined as:
how a business creates income
the desire to work
a business's desire to spend money
an incentive to make money
23
The study of economics is concerned with:
making choices to use scarce resources efficiently
customs and traditions
making sure businesses succeed
efficiently allocating society's products
24
An economic system formed around habits, customs and religion is ...
primitive system
natural system
traditional system
archaic system
25
Which economic system has a very low unemployment rate?
market
planned
command
mixed
26
The outwardly bowed shape of the production possibilities curve tells us:
that marginal costs are expensive
that production is inefficient
how opportunity costs increase
that growth is unsustainable
27
What does the Production Possibilities Frontier tell us?
It predicts when unemployment is rising.
It maps trade between two nations.
It shows the possible outcomes when two goods are produced.
It tells us when we are in recession.
28
The resources used to make all goods and services are called the...
the production frontier
natural resources
factors of production
production tradeoffs

Economics Fundamentals Flashcards | StudBud