Why does the government provide certain goods and services, like roads, in a free economy?

Impractical for individuals to pay/organize on their own

How do incentives affect competition in a free market economy?

They encourage firms to make products that consumers want at lower prices

What is a characteristic of a centrally planned economy?

The government controls production, pricing and what people can buy

What distinguishes communisms from socialism?

Communism, government controlls all, socialism allows more public choices

What is the main purpose of welfare program?

Financial aid to poor by redistributing wealth from collected taxes

What are the three main goals of policymakers for economic strength?

High employment, growth and stability

Drawing a production possibilities curve helps a country's economists determine what?

How the production of one good affect the production of another

Why does the U.S. government get involved in the economy?

To provide national defense and public schools

Which of the following is one of the basic questions that societies answer to manage their resources?

What goods and services should be produced?

What is the primary role of the government in the American free enterprise system?

To protect property rights, contracts, and business activities

What factors do societies consider when deciding how goods and services should be produced?

The availability of resources like land, labor, and capital

What is the purpose of government redistribution of income?

Provide funding for retirement and help people with disabilities

What is the fundamental principle of the free enterprise system regarding consumers?

Consumers have the freedom to make their own economic choices

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ECON REVIEW TOPIC 1.1 - 2.7

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Questions 20

Answers

1
The points on a production possibility frontier all represent what?
Different types of resources
Underutilization of resources
The efficient use of resources
The cost of using resources
2
What is the study of economic behavior in a nation's entire economy called?
Financial Literacy
Macroeconomics
Microeconomics
Business Ethics
3
Why does the government provide certain goods and services, like roads, in a free economy?
Only a small number of people use them
Private businesses refuse to build them
Impractical for individuals to pay/organize on their own
They generate high profits for the government
4
What are the three factors of production?
Human capital, physical capital, intellectual capital
Needs, wants, choices
Workers, management, entrepreneurs
Land, labor, capital
5
How do incentives affect competition in a free market economy?
They prevent firms frmincreasing prices
They eliminate the need for competition
They encourage firms to make products that consumers want at lower prices
They ensure that only one company controls the market
6
What is a characteristic of a centrally planned economy?
There is competition between different businesses
Consumers have more freedom to decide what to purchase
The government controls production, pricing and what people can buy
People can choose what to buy and set their own prices
7
What distinguishes communisms from socialism?
Communism allows private ownership, socialism does not
Communism there is not government, socialism has a government system
Communism doesn't believe in wealth redistribution, socialism does
Communism, government controlls all, socialism allows more public choices
8
What is the main purpose of welfare program?
To give unlimited financial support to all citizens regardless of income.
Financial aid to poor by redistributing wealth from collected taxes
Replace all private charities and non-profit organizations
To eliminate the need for employment
9
What are the three main goals of policymakers for economic strength?
Tax cuts, regualtion and innovation
Military spending, inflation, and ubanization
High employment, growth and stability
Trade control, education, and debt reduction
10
Drawing a production possibilities curve helps a country's economists determine what?
Which resources should be used to produce goods
How many factories and how much farmland the country should have
Which goods the country can produce
How the production of one good affect the production of another
11
Why are entrepreneurs important to the economy?
They promote economic growth
They are willing to take risks
They desire profits
They have talent and imagination
12
Why does the U.S. government get involved in the economy?
To ensure no on pays taxes
To limit economic freedom and innovation
To provide national defense and public schools
To create more jobs in the private sector
13
Why do individuals, businesses, and governments make trade-offs?
To make more money
To promote their values
Because resources are limited
Because large groups of people can't easily make decisions
14
Which of the following is one of the basic questions that societies answer to manage their resources?
How can we eliminate scarcity?
What is the best way to limit trade-offs?
How can we reduce technological advancement?
What goods and services should be produced?
15
What is the primary role of the government in the American free enterprise system?
To control all business activities and set prices
To eliminate competition between businesses
To own and operate major industries
To protect property rights, contracts, and business activities
16
Which statement best describes opportunity cost?
The value in dollars of a trade-off
The best alternative decision
The best choice in a decision
All the alternatives not chosen in a decision
17
What factors do societies consider when deciding how goods and services should be produced?
How much time is required for each product
The personal preferences of consumers
The weather conditions and natural disasters
The availability of resources like land, labor, and capital
18
What is the purpose of government redistribution of income?
To limit government involvement in the economy
To increase business profits
To stop businesses from fixing pirices
Provide funding for retirement and help people with disabilities
19
What is the fundamental principle of the free enterprise system regarding consumers?
Consumers have no influence on what businesses produce
Consumers must follow government regulations when making purchases
Consumers have the freedom to make their own economic choices
Consumers are required to buy goods from local businesses
20
Free market economy, who decides answers to the 3 basic economic questions-what and how to produce and who gets it?
The government
Voluntary exchanges in markets
Consumers only
Central planners

ECON REVIEW TOPIC 1.1 - 2.7 Flashcards | StudBud