Economics Review Unit 1

Question 1

When can point X on the model be attained?

Accepted Answer

Introducing new technologies

Question 2

All the following are characteristics of the U.S. free enterprise system EXCEPT

Accepted Answer

Restricted price market

Question 3

What is required for economy producing at point B to move to point D?

Accepted Answer

Produce less coffee

Question 4

Ted likes to make decisions about his job, where he lives and what he likes to purchase. Which economy does Ted live in

Accepted Answer

Free Enterprise

Question 5

Our_____are limited, our wants & needs are______, we have to weigh all________. Which words complete sentence in order?

Accepted Answer

resources... unlimited... opportunities

Question 6

Competition in a free enterprise system results in

Accepted Answer

Lower prices for products

Question 7

What is opportunity cost?

Accepted Answer

The value of the next best alternative

Question 8

Which of the following is NOT a benefit of free enterprise?

Accepted Answer

Absence of laws

Question 9

Wealth creation, individual freedom, variety of goods, responsive prices and investment opportunities are

Accepted Answer

Benefits of the free enterprise system

Question 10

The characteristic of the free enterprise system that creates the incentive for people to work, save, and invest?

Accepted Answer

Private Property Ownership

Question 11

Bob can buy a TV or PlayStation 5. Bob buys the PlayStation 5. What is the opportunity cost of buying PlayStation 5?

Accepted Answer

TV

Question 12

Competition in the free enterprise system leads to

Accepted Answer

Best product at the lowest price

Question 13

Nancy purchases cosmetics in a department store. Where is Nancy in the Circular Flow Model?

Accepted Answer

Product/Goods and Services Market

Question 14

Austrian economist defended free markets against socialism and communism. Wrote "The Road to Serfdom"

Accepted Answer

Friedrich Hayek

Question 15

A country's economy is based on socialism because of this economic condition(even if it has some free markets)

Accepted Answer

Government funding of education & health care

Question 16

A communist country has plenty of fertile land and farmers. The country cannot produce enough food because of

Accepted Answer

A lack of incentives

Question 17

Which factor of production involves taking risks and combining the other factors of production to create businesses?

Accepted Answer

Entrepreneurs

Question 18

The motivations for people to work, save, and invest are

Accepted Answer

Incentives

Question 19

Jim is working at CVS. Where is he in the Circular Flow Model?

Accepted Answer

Factor market

Question 20

All human effort that goes into producing goods and services in an economy is __________.

Accepted Answer

Labor

Question 21

Scottish economist sometimes called "The Father of Economics" or "The Father of Capitalism"

Accepted Answer

Adam Smith

Question 22

Kroger is in which sector of the circular-flow model?

Accepted Answer

Business firms

Question 23

In a traditional economy, which question is NOT considered?

Accepted Answer

How productive they will be

Question 24

When Betty gets a job at a pet store, what is she doing?

Accepted Answer

Selling her resource

Question 25

Bill does not like to make choices, believes people should be rewarded equally, would be happy in this economic system?

Accepted Answer

Communist

Question 26

The idea of choice presents which of the problems in economics?

Accepted Answer

Decisions produce costs

Question 27

What gives individuals and businesses the opportunity to make their own decisions?

Accepted Answer

Economic freedom

Question 28

When we use the term opportunity cost in economics, it refers to all of the following situations EXCEPT

Accepted Answer

Buying chicken at store to fix for dinner

Question 29

With regard to coffee and sugar in production possibilities curve, what does point D represent?

Accepted Answer

Combination that can be attained if all resources are used 100% efficiently

Question 30

The government controls production, prices are regulated, and all decisions are centralized. This economy is _______

Accepted Answer

Command

Economics Review Unit 1

Questions 30

Economics Review Unit 1

Questions 30