Which scenario best illustrates the law of diminishing marginal utility?

a new toy is less exciting the more a child plays with it

efficiency with which goods and services are produced

government payment to a household or firm

an agreement between buyer and seller

people make their own decisions without interference

government funded projects: dams, roads, bridges

economic decisions are made by a powerful ruler or government

limited resources but unlimited wants

right to do what you want with what you own

Why did the Soviet Union experience many surpluses and shortfalls?

central planners could not manage every detail

What would government do in a model free enterprise system?

protect property rights and enforce contracts

the exchange of one benefit or advantage for another

tools, machines, buildings used to produce goods

cost-benefit analysis

a way to compare the costs and benefits

factors of production

land, labor, capital and entrepreneurship

money earned after subtracting operating costs

free enterprise system

economic system with private ownership and profit

What does it mean to maximize utility?

to gain the most satisfaction possible

economic system where decisions are left up to individuals

goods and services are available when people want them

next best alternative when making a choice

the fairness with which an economy distributes its resources and wealth

something that motivates a person to take a course of action

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Unit 1 Progress Check

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Questions 38

Answers

1
mixed economy
government funded projects: dams, roads, bridges
government payment to a household or firm
economic system in which government & individuals both play important roles
economic system with private ownership and profit
2
When Amy returns a good library book without furnishing it so she won't have to pay a fee, what is her opportunity cost?
paying for something else
reading a different book
finishing the book
paying the fee
3
entrepreneurship
the willingness and ability to take risks involved in starting businesses
land, labor, capital and entrepreneurship
efficiency with which goods and services are produced
tools, machines, buildings used to produce goods
4
traditional economy
goods and services are available when people want them
economic decisions are made based on custom
economic decisions are made by a powerful ruler or government
economic system where decisions are left up to individuals
5
Which scenario best illustrates the law of diminishing marginal utility?
a new toy is less exciting the more a child plays with it
someone who doesn't listen to music does not care about getting a new CD
a car breaks down more as it gets older
a collector of china figurines is eager to get a new one
6
productivity
tools, machines, buildings used to produce goods
land, labor, capital and entrepreneurship
the willingness and ability to take risks involved in starting businesses
efficiency with which goods and services are produced
7
transfer payments
government payment to a household or firm
economic system in which government & individuals both play important roles
economic system with private ownership and profit
government funded projects: dams, roads, bridges
8
contract
an agreement between buyer and seller
money earned after subtracting operating costs
right to do what you want with what you own
9
economic freedom
people make their own decisions without interference
next best alternative when making a choice
the fairness with which an economy distributes its resources and wealth
economy is expanding
10
public works
government funded projects: dams, roads, bridges
economic system with private ownership and profit
government payment to a household or firm
economic system in which government & individuals both play important roles
11
command economy
economic system where decisions are left up to individuals
economic decisions are made based on custom
economic decisions are made by a powerful ruler or government
goods and services are available when people want them
12
scarcity
limited resources but unlimited wants
the exchange of one benefit or advantage for another
something that motivates a person to take a course of action
a way to compare the costs and benefits
13
property rights
right to do what you want with what you own
money earned after subtracting operating costs
an agreement between buyer and seller
14
Why did the Soviet Union experience many surpluses and shortfalls?
the cold Russian climate made farming hard
the country depended on imports to obtain resources
the labor force was not well educated
central planners could not manage every detail
15
Which of these economic goals is most important in a traditional economy?
stability
freedom
efficiency
growth
16
Which kind of economy is most common today?
command
market
mixed market
traditional
17
People’s wants are unlimited. This fact means that which of the following is always present?
. scarcity
marginal utility
shortages
costs of production
18
What are the factors of production?
wages, salaries, and profits
risk and opportunity
land, labor, and capital
goods and services
19
What is the best title for the following list? -innovator -strategist -risk taker
capitalist
laborer
investor
entrepreneur
20
What would government do in a model free enterprise system?
ensure that prices remain reasonable
support entrepreneurs to encourage innovation
stay out of economic activity altogether
protect property rights and enforce contracts
21
tradeoff
something that motivates a person to take a course of action
the exchange of one benefit or advantage for another
limited resources but unlimited wants
a way to compare the costs and benefits
22
capital
land, labor, capital and entrepreneurship
tools, machines, buildings used to produce goods
efficiency with which goods and services are produced
the willingness and ability to take risks involved in starting businesses
23
cost-benefit analysis
a way to compare the costs and benefits
the exchange of one benefit or advantage for another
something that motivates a person to take a course of action
limited resources but unlimited wants
24
factors of production
the willingness and ability to take risks involved in starting businesses
tools, machines, buildings used to produce goods
land, labor, capital and entrepreneurship
efficiency with which goods and services are produced
25
What is the best title for the following list? -innovator -risk taker -strategist
laborer
capitalist
entrepreneur
investor
26
profit
right to do what you want with what you own
an agreement between buyer and seller
money earned after subtracting operating costs
27
The three fundamental economic questions are what to produce, ___________, and for whom.
where
when
why
how
28
free enterprise system
government funded projects: dams, roads, bridges
economic system with private ownership and profit
economic system in which government & individuals both play important roles
government payment to a household or firm
29
What are the factors of production?
goods and services
wages, salaries, and profits
land, labor, and capital
risk and opportunity
30
What does it mean to maximize utility?
to become as efficient as possible
to gain the most satisfaction possible
to strengthen a national infrastructure
to strengthen skills of a workforce
31
Why are tradeoffs necessary?
advertiesrs promote products
resources are limited
every product has flaws
people want different things
32
market economy
economic decisions are made based on custom
economic system where decisions are left up to individuals
economic decisions are made by a powerful ruler or government
goods and services are available when people want them
33
economic stability
economic system where decisions are left up to individuals
goods and services are available when people want them
economic decisions are made based on custom
economic decisions are made by a powerful ruler or government
34
economic growth
next best alternative when making a choice
economy is expanding
people make their own decisions without interference
the fairness with which an economy distributes its resources and wealth
35
opportunity cost
next best alternative when making a choice
economy is expanding
people make their own decisions without interference
the fairness with which an economy distributes its resources and wealth
36
People’s wants are unlimited. This fact means that which of the following is always present?
marginal utility
costs of production
shortages
scarcity
37
economic equity
next best alternative when making a choice
economy is expanding
people make their own decisions without interference
the fairness with which an economy distributes its resources and wealth
38
incentive
something that motivates a person to take a course of action
limited resources but unlimited wants
a way to compare the costs and benefits
the exchange of one benefit or advantage for another

Unit 1 Progress Check Flashcards | StudBud