What is another way to refer to a command economy?

Centralized, Communist/Authoritarian

What is the best definition of capital in Economics?

The tools and buildings used in producing an item

How do individuals specialize?

By focusing on ONE job through division of labor

What is the definition of opportunity cost?

The next best alternative to a choice.

What is the best definition of profit motive?

Desire to make money and motivates people to work hard

What are the 3 economic questions that societies try to answer with economic systems?

What, How, For whom to produce?

What is the best definition of consumer sovereignty?

Extent to which people are free to choose in the market

What is the best definition of competition?

Attempts by two or more entities try to get the same G & S

What is a free rider problem?

When someone uses a good or service but doesn't pay for it

How do we define productivity?

The relationship between inputs and outputs

Who answers the 3 basic economic questions in a market economy?

Consumers and producers, Buyers and sellers

What is the definition of scarcity?

Human wants exceed ability of resources to satisfy wants

When do people behave in rational ways, according to economists?

When costs > benefits and the person does that action

What is the best definition of land in Economics?

All natural resources used in producing an item

What is true about any point inside of the production possibilities frontier?

Inefficient (unemployed) resources

What is the best definition of labor in Economics?

The physical work done to produce an item

A classic market failure is an externality. What is an externality?

When a third party is affected by a problem in a market

What is the best definition of government regulation?

Extent to which the government intervenes in the economy

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Fundamental Economic Concepts EOC Review

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Questions 30

Answers

1
What is another way to refer to a command economy?
Centralized
Capitalist
Decentralized
Communist/Authoritarian
2
What is the best definition of capital in Economics?
The tools and buildings used in producing an item
The knowledge of how to use tools to produce an item
The physical work done to produce an item
All natural resources used in producing an item
3
How do individuals specialize?
By focusing on ONE job through division of labor
By doing multiple tasks repeatedly
4
What is the definition of opportunity cost?
A means of allocating resources.
A choice that is made at the expense of other options.
The last alternative to a choice.
The next best alternative to a choice.
5
The following list is the example of which factors of production? Oil, water, forests.
Entrepreneurship
Labor
Land
Capital
6
What is the best definition of profit motive?
Attempts by two or more entities try to get the same G & S
Extent to which the government intervenes in the economy
Desire to make money and motivates people to work hard
Extent to which people are free to choose in the market
7
What is true about point Y?
Inefficient (unemployed) resources
A loss of product B
A loss of product A
An impossible production point
8
Who answers the 3 basic economic questions in a command economy?
Consumers and producers
Buyers and sellers
Customs and historic precedent
The government
9
When people trade, why do they both benefit?
They non-fraudulently exchange in a fair way
All answers are correct
They voluntarily exchange products they have for needs
They gain products they may not be able to make alone
10
What are the 3 economic questions that societies try to answer with economic systems?
What, Where, and For whom to produce?
What, How, For whom to produce?
Where, How, When to produce?
When, How, What to produce?
11
What is the best definition of consumer sovereignty?
Extent to which the government intervenes in the economy
Extent to which people are free to choose in the market
Desire to make money and motivates people to work hard
Attempts by two or more entities try to get the same G & S
12
What is another way to refer to a market economy?
Communist/Authoritarian
Centralized
Capitalist
Decentralized
13
What is the best definition of competition?
Extent to which people are free to choose in the market
Desire to make money and motivates people to work hard
Attempts by two or more entities try to get the same G & S
Extent to which the government intervenes in the economy
14
What is a free rider problem?
When someone pays for goods and services
When someone gets a ride in a cop car
When someone receives income for work done
When someone uses a good or service but doesn't pay for it
15
How do we define productivity?
The relationship between production and consumption
The relationship between inputs and outputs
The relationship between goods and services
The relationship between eating and sleeping
16
Who answers the 3 basic economic questions in a market economy?
Consumers and producers
Buyers and sellers
Customs and historic precedent
The government
17
The following list is the example of which factors of production? Roads, dams, equipment
Capital
Entrepreneurship
Land
Labor
18
A command economic system is best at addressing which economic goals?
Equity, growth, security
Freedom, growth, efficiency
Equity, security, stability
Freedom, security, equity
19
What is the opportunity cost of moving from point A to point C?
A loss of product B
A loss of product A
Inefficient (unemployed) resources
An impossible production point
20
A market economic system is best at addressing which economic goals?
Equity, growth, security
Freedom, growth, efficiency
Equity, security, stability
Freedom, security, equity
21
Who faces the problems of scarcity?
Individuals
Governments
All answers are correct
Businesses
22
What is the definition of scarcity?
Human wants exceed ability of resources to satisfy wants
Land is able to support all life forms
Needs exceed the available wants of the world
Unlimited resources are able to satisfy limited wants
23
Price, lottery, force, contests, sharing, command are all strategies used to ______ resources.
Distribute
Demand
Allocate
Aggregate
24
When do people behave in rational ways, according to economists?
When benefits > costs and someone does that action
When costs > benefits and the person does that action
Nobody can be rational
When decisions are made without thought
25
What is the best definition of land in Economics?
All natural resources used in producing an item
The knowledge of how to use tools to produce an item
The physical work done to produce an item
The tools and buildings used in producing an item
26
What is true about any point inside of the production possibilities frontier?
A loss of product A
An impossible production point
A loss of product B
Inefficient (unemployed) resources
27
What is the best definition of labor in Economics?
The knowledge of how to use tools to produce an item
The tools and buildings used in producing an item
All natural resources used in producing an item
The physical work done to produce an item
28
A classic market failure is an externality. What is an externality?
When a government intentionally makes a problem in a market
When a third party is affected by a problem in a market
When a person intentionally creates a problem in a market
29
What is the best definition of government regulation?
Extent to which people are free to choose in the market
Desire to make money and motivates people to work hard
Extent to which the government intervenes in the economy
Attempts by two or more entities try to get the same G & S
30
What happens to income and unemployment when one attains a higher level of education?
Income up, unemployment up
Income down, unemployment down
Income down, unemployment up
Income up, unemployment down

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