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Economics Unit 1 Review Flashcards | StudBud
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Economics Unit 1 Review
Economics Unit 1 Review
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1
What is Human Capital?
the capital owned by individuals, not governments.
Machines that people use to make goods.
the physical skill and head knowledge of people.
the capital owned by individuals, not corporations.
2
A vacation costs $2,000. You don't work & earn $750. The opportunity cost of the vacation is
$2,750
$2,000
$750
$1,250
3
The resources used to make all goods and services are called the...
the production frontier
production tradeoffs
factors of production
natural resources
4
Which is not considered a need?
Clothing
TV
Shelter
Food
5
How do we define opportunity cost?
spending money on what you want
all other alternatives you give up to do what you want
marginal cost for non-fraudulent exchanges
the value of the next best alternative that is given up
6
Economics is the study of...
how societies, business, & people allocate scarce resources
how government regulations affect our daily lives.
the distribution of goods and services to societies.
ways to reduce wants to eliminate the problem of scarcity.
7
It which economic system can an entrepreneur thrive?
Communism
Feudalism
Capitalism
Socialism
8
Why is there scarcity in rich and in poor countries?
Entrepreneurs are scarce and companies need owners.
Some people are poor because needs are unlimited.
Resources are limited but wants are unlimited.
Wants are limited but needs are unlimited.
9
Which choice from factors of production is an example of Labor?
goods and services that are produced
sweat produced when working
mental and physical activity when producing
learning new skills
10
An entrepreneur
was a person who succeeded in a communist country.
has earned millions of dollars.
combined resources to create new products.
has many employees who work for them.
11
Moving from point D to point A requires...
a decrease in unemployment
both capital accumulation and a decrease in unemployment
technological change
decreasing output of X in order to boost output of Y
12
The term "land" in factors of production means ...
dirt
natural resources
unfinished goods
real estate
13
What is the opportunity cost of going to college?
significant student loan debt
high unemployment
no student loan debt
low unemployment
14
In every economic system, what must people choose to do?
Save money to reduce the national debt
Create an equal distribution of income
Make the best use of scarce resources
Satisfy all the wants of their society
15
The fundamental economic problem faced by all societies is ...
poverty
inequality
unemployment
scarcity
16
"Guns" (Capital/Government goods) and "butter" (Consumer/civilian goods) is the trade-off between...
Government & Consumer Needs and Wants
State & Federal
Guns & Butter
Dogs & Cats
17
What is a trade-off?
A product trade between companies
Giving away products for no cost
Giving up one benefit to gain another
Making a deal within a company
18
Why does every decision involves trade-offs?
some people have more money than others.
everyone’s resources are limited.
everyone has to make decisions.
some decisions are made for gov't, others for businesses.
19
What does the saying “There is no such thing as a free lunch” mean? TINSTAAFL
everything costs something
most things cost something
some things cost nothing
most things cost nothing
20
Into what four categories do economist divide factors of production?
land, labor, capital, and entrepreneurship
resources,labor,money, and entreprenuership
land, labor, money, and entrepreneurship
resources, labor, capital, and entrepreneurship
21
Which point on the graph is unattainable given current resources?
E
D
C
A
22
What do the points on the line represent?
Full employment of available resources
Budgeting for tomorrow
Inefficient use of available resources
Impossibile given current resources
23
The shift from line a (red) to line c (purple) means that
the economy has shrunk.
shoes and watermelons have become more expensive.
the economy has grown.
workers are probably earning less.
24
Necessities have little value while some non-necessities have a much higher value is known as
opportunity cost.
paradox of value.
economic interdependence.
trade-offs.
25
Which point on the graph is attainable given current resources, but inefficient?
C
B
A
E
26
Which of the following best describes a want?
Unlimited and ever changing
Limited and ever changing
Unlimited and never changes
Limited and never changes
27
What does the Production Possibilities Frontier tell us?
It maps trade between two nations.
It shows the possible outcomes when two goods are produced.
It tells us when we are in recession.
It predicts when unemployment is rising.
28
What is the economic rationale for the law of increasing opportunity costs?
Growth is limited by the pace of technological advancement.
Resources are not completely adaptable to other uses.
Full production of resources have not been achieved.
An economy’s present output is determined by technology
29
Which is the best definition of scarcity?
not having enough money to buy stuff
unlimited wants outpace limited resources
a shortage of goods
the allocation of goods and services
30
Which one of the following is a positive economic statement?
Pollution is the most serious economic problem
The government should provide basic healthcare to all citizens
As the price of gas increases, less gas will be purchased
Corporate profits are too high
