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BMF - Chapter 1
BMF - Chapter 1
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Chapter 1 - Economic Decisions & Systems
Flashcards
30 cards
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Practice quiz
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Questions
30
Answers
1
A demand curve illustrates the relationship between quantity demanded of a product and
production costs
quantity supplied
profit
price
2
The primary reason why businesses invest resources and take risks is to
improve products
earn a profit
provide jobs
produce goods & services
3
Most nations of the world can be classified as having a
command economy
market economy
traditional economy
mixed economy
4
The first step in the decision-making process is to
ID the choices
define the problem
review decision
evaluate advantages/disadvantages
5
Things that are required in order to live are wants.
False
True
6
In a _______________________ the resources are owned and controlled by the government.
Market economy
Mixed economy
Traditional economy
Command economy
7
An entrepreneur is an economic resource.
True
False
8
The market price for a product is the point where demand exceeds supply.
False
True
9
If you decide to purchase a DVD instead of a pair of jeans, the value of the jeans is the
trade-off price
profit
market price
opportunity cost
10
A marketplace is always a physical location where economic transactions take place.
False
True
11
_____________ refers to the quantity of a good or service that businesses produce.
demand
supply
trade-off
scarcity
12
The equilibrium or market price is where supply meets demand
true
false
13
Competition keeps prices low
False
True
14
Market price is determined by all of the following EXCEPT
supply
competition
opportunity cost
demand
15
three economic questions that must be answered by all nations EXCEPT:
What needs and wants will be satisfied?
Who will receive the profits earned?
What goods and services will be produced?
How will the goods and services be produced?
16
Tangible products you can purchase to meet your wants and needs are called goods.
False
True
17
Consumers are individuals that determine what products will be available for sale.
True
False
18
Economic decision-making is the process of deciding _________________________________.
how to use your income
how to spend your time
whether to buy products now or later
which needs & wants will be satisfied
19
Capitalism is another name for a traditional economic system.
False
True
20
Competition forces businesses to search for new ways to satisfy customers’ wants and needs.
False
True
21
Which of the following is not a principle upon which the U.S. economic system is based?
private property
competition
freedom of choice
government regulation
22
Water, air, and minerals are examples of
capital resources
consumer resources
human resources
natural resources
23
____________________ include tools and equipment used to produce goods and services.
natural resouces
capital resources
consumer resources
human resources
24
The United States is the largest producer of goods and services in the world.
True
False
25
Which of the following is an example of a service?
The hammer that is used to install the new shingles.
The effort of the worker you hire to put on that new roof.
The shingles used to put a new roof on your home.
The increased value of your home after a new roof.
26
China is the largest producer of goods and services in the world.
False
True
27
The basic economic problem results from scarcity.
False
True
28
An mp3 player is an example of a product that fulfills a need.
False
True
29
When many more people wish to purchase a product, its price will tend to ________.
stay the same
increase
fall
decline only to rise again
30
When you decide to buy a jacket instead of a concert ticket, you are making a trade-off.
False
True
