In an economy in transition from central planning to free enterprise, you might expect to see

state firms sold to private individuals or entities.

Which of the following is not a factor of production?

the amount of money required to buy a car

Economics is the study of how people

choose from limited resources to meet their needs.

A centrally planned economy is

one where central planners make all the major decisions.

Each point on a production possibilities curve shows

efficient utilization of resources.

When two persons trade goods:

both persons usually gain from the exchange.

Government policies designed to promote efficiency:

usually do so at the expense of equity.

Why are scarcity and choice basic to the study of economics?

because there is not an endless supply of all resources

Which is NOT capital?

the person whose photo is snapped by the candid photographer

Rapid and persistent inflation occurs mainly due to:

rapid increases in the quantity of money in the economy.

a market system with some degree of government involvement

Which of the following is an entrepreneur?

a computer repair show owner who opens a second shop

Which of the following is NOT a factor of production?

the children whom the woman supports with her labor

Which of the following is an example of a shortage?

not having enough of 1 type of soda in a store on Saturdays

Why are individuals required to constantly make choices about how to best utilize resources?

There is always a scarcity of resources.

Thinking at the margins means deciding about

adding or subtracting one additional unit of some resource.

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Fundamentals of Economics: Unit Review

30 termsStudBud Administration322 plays

Delivered to students on 9/21/18

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Questions 30

Answers

1
What flows from businesses to households in a product market?
products
human capital
labor
money
2
The resources used to make goods and services are called
the production possibilities frontier.
opportunity costs.
the gross national product.
factors of production.
3
In an economy in transition from central planning to free enterprise, you might expect to see
increased gov. presence in the factor and product markets.
increased job security.
state firms sold to private individuals or entities.
private firms sold to the government.
4
The self-regulating nature of the marketplace is called
the invisible hand.
equity
self-interest.
the safety net
5
A government that implements a policy designed to reduce inflation can expect unemployment to:
increase in the long-run.
decrease in the short-run.
decrease in the long-run.
increase in the short-run.
6
Which of the following is not a factor of production?
the land required for a hog farm
the training required to repair an airplane engine
the teacher required to teach an economics class
the amount of money required to buy a car
7
A country's production possibilities will grow if it
produces more guns than butter.
increases its resources.
lowers its opportunity costs.
makes more trade-offs.
8
Using resources in such a way as to maximize the production of goods and services is called
underutilization
efficiency.
growth
thinking at the margins
9
Physical objects such as clothes or shoes are defined as
goods
services
wants
needs
10
Economics is the study of how people
make money
choose from limited resources to meet their needs.
respond to shortages
gain knowledge and skills from study and experience.
11
Competition and self-interest are two important forces in
traditional economies
free market economies
communist economies
socialist economies
12
How a society answers the key economic questions primarily depends on
how it combines factors of production.
the underutilization of resources.
how many resources it has available.
a society's goals and values.
13
A centrally planned economy is
an economic system that has no government involvement.
a form of free enterprise with minimal gov. involvement
one where central planners make all the major decisions.
always the most efficient economic system
14
Each point on a production possibilities curve shows
the relationship of shortage to scarcity.
underutilization of resources.
efficient utilization of resources.
the potential for future growth.
15
If Karen wakes 3 hrs early she could get an A. What is the opportunity cost of sleeping in?
three additional hours of sleep
hypertension
three hours of studying
an A
16
When two persons trade goods:
the overall well being of the two persons remains unchanged.
one person usually gains at the expense of the other.
both persons usually gain from the exchange.
one person always gains at the expense of the other.
17
Government policies designed to promote efficiency:
always fail.
tend to cause the economy to grow more slowly.
usually do so at the expense of equity.
require very high taxes.
18
Why are scarcity and choice basic to the study of economics?
because there is not an endless supply of all resources
because they are important factors of production
because there is an endless supply of all resources
because most people have limited wants and needs
19
Which is NOT capital?
the state house where state government is conducted
the computer used by an accountant
the person whose photo is snapped by the candid photographer
the paint used by a housepainter
20
The doctrine that government should not intervene in the marketplace is called
socialism
laissez faire
communism
the invisible hand.
21
Rapid and persistent inflation occurs mainly due to:
high wage increases demanded by labor unions.
greedy firms who charge prices that are too high
rapid increases in the quantity of money in the economy.
trade with other countries.
22
A mixed economy is
one where the gov. decides production levels and prices
a market and command system rolled into one.
a market system with some degree of government involvement
a socialist economic system.
23
Which economic goals are difficult to achieve in a pure market system?
stability and security
freedom and equity
efficiency and freedom
equity and security
24
The skills and knowledge gained by a worker through education and experience are
physical capital
entrepreneurial
human capital
production possibilities
25
Which of the following is an entrepreneur?
a computer repair show owner who opens a second shop
an ad executive who writes an award winning commerical
an insurance lawyer who wins a medical malpractice suit
a doctor who volunteers with Red Cross
26
What is the opportunity cost of moving from point A1 to B1?
5 services
6 services
4 goods
6 goods
27
Which of the following is NOT a factor of production?
the children whom the woman supports with her labor
a woman who makes a quilt
the wood frame on which the quilt is sewn
the cotton cloth and thread used in the quilt
28
Which of the following is an example of a shortage?
the price of oil going up b/c more people are driving cars
the price of grain going down when supplies are scarce
having a sale on soda b/c of too many sodas on the shelf
not having enough of 1 type of soda in a store on Saturdays
29
Why are individuals required to constantly make choices about how to best utilize resources?
They all have more needs than wants.
There is always a scarcity of resources.
They all have more wants than needs.
There is always a shortage of resources.
30
Thinking at the margins means deciding about
adding or subtracting one additional unit of some resource.
increasing or decreasing technical know-how.
maximizing goods and services.
investing with borrowed money.

Fundamentals of Economics: Unit Review Flashcards | StudBud