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Fundamentals of Economics Review Flashcards | StudBud
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Fundamentals of Economics Review
Fundamentals of Economics Review
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A review to go over concepts for the Unit 1 test.
Flashcards
31 cards
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Questions
31
Answers
1
Why is specialization so important in a business?
Allows workers to share each job equally
Allows owners to hire more workers than they really need
Allows owners to hire less workers and still make a profit
Allows workers to focus on one area of expertise
2
Which of the following is an example of an investment in human capital?
a worker learns how to operate a computer
a state builds a new highway
a county hires a new tax collector
a company buys a new piece of equipment
3
Why do we have opportunity costs?
We have unlimited wants but limited productive resources
Marginal costs are greater than marginal benefits
Because there is a cost with everything we do in life
We have limited wants but unlimited productive resources
4
A business gets a subsidy from govt to produce electric cars. What kind of incentive is this?
negative
neither positive or negative
whats a subsidy?
positive
5
What is the greatest disadvantage of someone moving from a command to market economy?
Loss of freedom
Loss of getting to choose your own career
Loss of pure quality goods
Loss of a guaranteed job
6
Why is buying a car an example of Voluntary Exchange?
Because the car company earns a profit and you have a debt
Because you have limited resources and choices in car types
Because both parties gain from the exchange
Because the car company must sell car for a certain price
7
Being awarded a college scholarship based on your GPA is what kind of allocation choice?
First come/ First serve
Personal Characteristic
Force
Authority
8
You go out to eat and notice a waiter, a cook, and a dishwasher. This is an example of...
shared consumption
specialization
economy of scale
marginal productivity
9
What is the most important alternative that we give up whenever we make choices
Opportunity Cost
Marginal Revenue
Trade offs
Opportunity Gained
10
An assembly line can increase a factory’s productivity because it allows workers to...
diversify their skills
put in overtime hours on the job
specialization or work on a specific task
use a wide range of knowledge
11
What does moving point B to C represent?
A gain of 30 tons of consumer goods
A loss of 30 tons of capital goods
A gain of 30 tons of capital goods
A loss of 30 tons of consumer goods
12
Any resources that are made by humans and then used to create goods and services are called
services
production
labor
capital
13
If a bridge needs to be built in a Market economy, who will pay for the bridge?
The city government will decide
The state government will allocate its taxes to pay
The owners of the property
The federal government will raise taxes to pay for it
14
In the image what does Y represent?
Impossible
Opportunity Costs
Efficiency
Inefficiency
15
Which one of the following is NOT one of the three basic economic questions?
How to produce
For whom to produce
When to produce
What to produce
16
Maria decides to buy $10 of art pencils instead of a book. What is her opportunity costs?
The time she spent shopping for books
the satisfaction she would receive from reading the book
The time she spent drawing with the pencils
the satisfaction she will receive from drawing
17
In the production of chocolate chip cookies, which represents the factor of Physical CAPITAL?
the worker who decorates the cookies
the retailer who sells the cookies
the oven used to bake the cookies
the property where the factory is located
18
What is an economist example of Land?
factories, trucks, and machines
iron ore, cotton, water, trees
cashier, cook, and manager
buildings, offices, and barns
19
In the image what does X represent?
Opportunity Costs
Inefficiency
Impossible
Efficiency
20
Which of the following is a Public Good?
Georgia State HWY 400
Delta Airlines
Town Center Mall
Neighborhood swimming pool
21
Productivity goes up whenever...
the same output is produced with fewer inputs
there is a cut in pay
more resources are discovered
the government raises taxes
22
What are the two main goals of a market economy?
Redistribution of wealth and Equity
Security and profit
Equity and security
Efficiency and profit
23
Which is NOT a strategy for allocating scarce resources?
random selection
first come, first served
market correction
supply and demand
24
What is the rule for rational decisions?
Marginal benefit is equal to or greater than marginal cost
Marginal profit exceeds marginal benefits
The intersection of profit and costs
Marginal cost is equal to or greater than marginal benefit
25
What of the following is NOT a goal or motivation of an entrepreneur?
Guaranteement of a job
Job creation
Innovation and Profit
Improving society
26
Which type of economy does the majority of modern economies fit into?
Command
Fixed
Mixed
Free Market
27
The fundamental problem of economics is:
the scarcity of FOP vs. unlimited wants of humans.
establish an equitable system of taxation
equitable distribution of money in order to reduce poverty
establish a democratic political framework
28
When a country’s businesses invest heavily in new technology, what will result?
economic stability
economic depression
economic growth
economic decline
29
In a market economy how are goods and services produced which benefit the community?
Various government departments would build whats necessary
It's up to individuals/businesses to build at their expense
Governments raise the needed funds
Taxes are collected and funds used to build goods/services
30
Which is best for Consumers....Regulation or Deregulation?
Deregulation
Neither
Both
Regulation
31
Which is best for Producers....Regulation or Deregulation?
Regulation
Both
Neither
Deregulation
