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The Basics of Economics
The Basics of Economics
20 terms
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#basicsofeconomics
Flashcards
20 cards
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Questions
20
Answers
1
At the end of the Iraq war, U.S. policy makers cut back on military spending to improve society
none of these
this is cost/benefit analysis
this budgeting
this is an instance of guns and butter
2
Steve Jobs was an example of this productive resource.
capital
entreprenuer
labor
land
3
This refers to the use of fewer resources than the economy is capable of.
maximum output
none of these
efficiency
underutilization
4
What is the difference between shortage and scarcity?
There is no real difference
Scarcity results from falling prices
Scarcity concerns a single item
Scarcity always exists
5
This graph illustrates the opportunity costs a society faces because of scarcity of resources.
supple curve
demand curve
circular flow of economic activity
production possibilities frontier
6
one must make choices in using resources because of this.
opportunity cost
none of these
trade-off
scarcity
7
Which of these is NOT one of the three key questions that every society must answer because of scarcity?
How should the goods and services be produced?
What goods and services should be produced?
Who should the goods and services be produced for?
Who should produce these goods and services?
8
Economics is the study of how people seek to satisfy needs and wants by making
capital goods
entrepreneurs
choices
goods and services
9
What is the act of giving up one benefit in order to gain another greater benefit.
scarcity
marginal thinking
underutilization
opportunity cost
10
Why are goods and services scarce?
Resources used to produce them are limited.
Greedy people want too many goods.
People want more than they can have.
Some goods cost more than others.
11
Which of the following lists of factors of production would an economist categorize as land?
factories, office buildings, assembly lines, and workers
dams, bridges, rock quarries, oil wells
farm fields, tractors, pesticides, fertilizers
iron ore, natural gas, fertile soil, water
12
What does point X above the curve represent?
efficiency
maximum production
under production
economic growth
13
In car factory, a robot used to build a car is an example of this type of factor of production.
labor
capital
land
entrepreneurship
14
Which of these countries does not face scarcity.
Spain
United States
They all face scarcity
Mexico
15
What are the uses of a production possibilities curve?
to illustrate efficiency
to show alternative ways to use productive resources
to show growth
all of these
16
This represents an economy using all its resources to produce maximum output.
production possibilities frontier
underutilization
none of these
slope
17
What does point A under the curve represent?
under production
not possible
maximum production
none of these
18
What is the highest valued alternative given up when making a choice?
scarcity
trade-offs
abundance
opportunity cost
19
Economist use the terms guns and butter to represent trade-offs between these two options.
none of these
plastic toys and food
playing and eating
military spending and consumer spending
20
This is a situation in which people desire more than can be produced with available resources.
scarcity
abundance
surplus
poverty
