Econ Exam Review

Question 1

Unlimited Wants + Limited Resources = ?????.Which of the following best completes the above “equation”?

Accepted Answer

Scarcity

Question 2

How does the process of specialization change an economy?

Accepted Answer

Improves efficiency of production

Question 3

Which of the following is an economic goal of United States government policy?

Accepted Answer

To promote full employment

Question 4

Which of the following is the best example of the law of supply?

Accepted Answer

A sandwich shop increases the number of sandwiches when the price increases

Question 5

A hurricane hit Florida and destroyed half of the orange crop. What would most likely happen to the orange market?

Accepted Answer

The price of oranges will increase

Question 6

In economics, what is the choice people give up?

Accepted Answer

Opportunity Cost

Question 7

What is the central banking system in the United States?

Accepted Answer

Federal Reserve System

Question 8

Food, clothing, and shelter are examples of human __________?

Accepted Answer

Needs

Question 9

Which type of tax is the Michigan 6% Sales tax?

Accepted Answer

Proportional

Question 10

The six main characteristics of money are acceptability, portability, divisibility, uniformity,

Accepted Answer

scarcity and durability.

Question 11

What would the Federal Reserve Bank (FED) do to fight inflation?

Accepted Answer

Slow the growth of the money supply

Question 12

The buildings, structures, machinery, and tools used in the production process are called __________?

Accepted Answer

Capital Goods

Question 13

Who answers the 3 economic questions in a Market economy?

Accepted Answer

Producers and consumers

Question 14

Which of these does the Gross Domestic Product (GDP) represent?

Accepted Answer

The total value of finished goods and services produced in a year

Question 15

A company decides to install more machines and lay off workers. Which economic question is addressed directly?

Accepted Answer

How to produce

Question 16

Which factor will decrease the demand for a product?

Accepted Answer

A decrease in the number of buyers

Question 17

Which scenario best exemplifies the Paradox of Value?

Accepted Answer

Diamonds cost more than water

Question 18

Economics is the study of how resources are utilized to satisfy societies’ unlimited wants and needs?

Accepted Answer

True

Question 19

Which of the following is the best measure of a nation’s economic health?

Accepted Answer

Real GDP

Question 20

Who answers the 3 economic questions in a traditional economy?

Accepted Answer

Past practices and traditions

Question 21

Which of the following goods would be deemed elastic?

Accepted Answer

Designer Clothing

Question 22

Who answers the 3 economic questions in a Command economy?

Accepted Answer

The Government

Question 23

All of the following are factors of production EXCEPT?

Accepted Answer

Corporations

Question 24

A consumer’s desire for a new iPhone would fall into which category?

Accepted Answer

Want

Question 25

Which of these actions would most likely result in a decrease in consumer spending?

Accepted Answer

Increasing income taxes

Question 26

Producers and consumers require one another for either to be successful?

Accepted Answer

True

Question 27

What is the law of demand?

Accepted Answer

When the price goes up the quantity demanded goes down

Question 28

What is the “law of supply”?

Accepted Answer

When the price goes up the quantity supplied goes up

Question 29

What is the most basic economic issue for all societies?

Accepted Answer

Scarcity

Question 30

Salt would be a good example of a ___________ good.

Accepted Answer

Inelastic

Econ Exam Review

Questions 30

Econ Exam Review

Questions 30