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