Fundamentals of Econ

Question 1

Why is the consumer considered "king" in a capitalist economy?

Accepted Answer

consumers determine what products will be produced

Question 2

In a free enterprise system, what motivates individuals to start a business?

Accepted Answer

the desire to earn a profit

Question 3

In a command economy, how is it determined what goods and services will be produced?

Accepted Answer

government planning decides what to produce

Question 4

Which of the following is NOT one of the factors of production?

Accepted Answer

wants

Question 5

_ when you perform tasks that you can do relatively more efficiently than others?

Accepted Answer

specialization

Question 6

Market where productive resources are bought and sold?

Accepted Answer

Factor Market

Question 7

The climate is an example of what factor of production?

Accepted Answer

land

Question 8

__ takes place when work is arranged so that individual workers do fewer tasks than before?

Accepted Answer

division of labor

Question 9

Manufactured goods that are used to produce other goods and services is called?

Accepted Answer

capital good

Question 10

_____________ occurs when a nation's total output of goods and services increase over time?

Accepted Answer

economic growth

Question 11

Market where producers sell their goods and services to consumers?

Accepted Answer

Product Market

Question 12

A contradiction between necessities and value is called? (Hint: value of water and diamonds)

Accepted Answer

Paradox of Value

Question 13

Communism and socialism are usually found in what type of economic system?

Accepted Answer

command

Question 14

What is the fundamental economic problem?

Accepted Answer

scarcity

Question 15

How does a traditional economy differ from a capitalist economy?

Accepted Answer

traditional system - decisions are based off of customs

Questions 15