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Unit 3 Test Review Fundamental Economic Concepts Flashcards | StudBud
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Unit 3 Test Review Fundamental Economic Concepts
Unit 3 Test Review Fundamental Economic Concepts
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Fundamental Economic Concepts
Flashcards
26 cards
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Questions
26
Answers
1
What is the opportunity cost of moving from point B to point C? (use cars)
10 cars
15 cars
5 cars
2
Name point B on the Circular Flow Model
Government
Business Firms
Households
3
What is the opportunity cost of moving from point D to point E? (use cars)
5 cars
10 cars
4
Name point A on the Circular Flow Model
Household
Business Firms
5
Which statement best explains the importance of economic decision making when scarcity is a factor?
Economic decisions are made by the majority.
Each choice must be made with incomplete information.
Each choice results in an opportunity cost.
Economic decisions provide access to more resources.
6
Which statement best explains the movement from S1 to S2 shown on this graph?
higher costs for natural resources
technological improvements in production
an increase in workers' salaries
7
What is the opportunity cost of moving from point A to point B? (use cars)
5 cars
20 cars
15 cars
10 cars
8
Which statement best describes the role of households within the circular flow model?
They collect taxes from businesses and individuals
They produce goods and services to sell to consumers
They sell labor to businesses and pay taxes to government
9
Which term replaces this question mark?
Supply
Marginal Benefit
Consumption
10
Name point C on the Circular Flow Model
Households
Government
11
Name point D on the Circular Flow Model
Goods and services
Product Market
Resource Market
12
Which statement best explains the move from D1 to D2 shown on this graph?
The cost of Product X increases.
There is an increase in personal income taxes.
There is a decrease in the price of a complementary good.
A government research study finds that Product X has health benefits.
13
Which statement best explains the economic concept of demand?
It is influenced by changes in price
It depends on government intervention.
14
Which factor can cause a shift on the demand curve?
improved manufacgturing efficiency
prices of other goods
investment capital
government regualtion
15
The lack of enough resources to produce everything people want is which central economic problem?
productivity
production possibilities
allocation
scarcity
16
Which phrase best completes the list below?
Urban growth
consumer demand
entrepreneurship
17
A winter freeze destroys 25 percent of the orange harvest. Which statement is the most accurate?
The price of orange juice will remain the same as the demand increases.
The price of orange juice will increase as the supply decreases.
The supply of orange juice will remain the same as the price decreases.
18
Which of the following provides services and collects taxes?
Government
Households
19
Which government action would most likely increase the flow of money from households to businesses?
an expansion of public services
a reduction of personal income tax
an increase in interest rates
20
A production possibilities curve illustrates the ____________ facing an economy that ___________ only two goods.
trade-offs, produces
price, sells
shortages, produces
trade-offs, consumes
21
Which of these most directly contributes to the problem of economic scarcity?
People must earn money to provide for their families.
People have unlimited wants for goods and services.
22
College graduates are a segment of which factor of production?
land
labor
23
How would this graph most likely change if the price of a complementary good were to increase?
The demand curve would shift to the left.
The supply curve would shift to the left.
24
Demand for a good will most likely decrease when
Producers develop a new technology that helps them produce more efficiently
There are many substitutes for it.
Consumer income rises by ten percent.
The price of it decreases.
25
Which of the following statements is true regarding the relationships in the circular flow of the economy?
Government buys goods and services from households in exchange for taxes
Businesses pay wages, and profits to households in exchange for resources
26
Maria has enough money to do only one thing on her list. What is the opportunity cost of Maria’s lunch choice?
Treating a friend to lunch
Buying her grandmother a present
Seeing a movie
