Each point on a production possibilities curve shows

efficient utilization of resources.

The circular flow model shows

interactions between households and businesses

Which is a key economic question faced by all countries?

What goods and services should be produced?

Entrepreneurs are people who

put together land, labor, & capital to create new businesses

The free enterprise system of the United States is best described as a

mixed economy w/ economic freedom & government intervention.

The purpose of a production possibilities graph is to

show alternative ways to use an economy's resources.

Which of the following is NOT a factor of production?

the children whom the woman supports with her labor

people have trouble supplying the g&s at current prices.

Economics is the study of how people

choose from limited resources to meet their needs.

Thinking at the margins means deciding about

adding or subtracting one additional unit of some resource.

Which is NOT capital?

the person whose photo is snapped by the candid photographer

Scarcity always exists because

needs and wants are not limited, but resources are limited.

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Economics Basics

22 termsStudBud Administration26 plays

Chapters 1 and 2

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Questions 22

Answers

1
Each point on a production possibilities curve shows
underutilization of resources.
the relationship of shortage to scarcity.
the potential for future growth.
efficient utilization of resources.
2
The self-regulating nature of the marketplace is called
self-interest.
the invisible hand.
the safety net.
equity
3
The skills and knowledge gained by a worker through education and experience are
entrepreneurial.
physical capital
production possibilities.
human capital.
4
Using resources in such a way as to maximize the production of goods and services is called
growth
underutilization
thinking at the margins.
efficiency
5
The circular flow model shows
how many firms can support the needs of how many households.
interactions between households and businesses
what inputs are required for what outputs.
how profits are made.
6
Which is a key economic question faced by all countries?
How much money should be raised in taxes?
What goods and services should be produced?
How big should the army be?
How many schools should be built?
7
Giving up one alternative for another is called
human capital.
underutilization
efficiency
a trade-off.
8
The government decides which goods and services will be produced in a
market economy.
fluctuating economy.
planned/command economy.
mixed economy.
9
Entrepreneurs are people who
help settle labor disputes
work on the floor of the stock exchange
put together land, labor, & capital to create new businesses
produce all of a country's guns and butter.
10
Competition and self-interest are two important forces in
centrally-planned economies.
traditional economies
free market economies.
communist economies.
11
Countries choosing between producing military or consumer goods, a trade-off economists call
export or import.
farm goods or factory goods.
guns and butter.
a free market economy.
12
The free enterprise system of the United States is best described as a
planned economy
free market economy.
mixed economy w/ economic freedom & government intervention.
traditional economy.
13
The purpose of a production possibilities graph is to
show alternative ways to use an economy's resources.
tell farmers how many watermelons to plant.
show how a factory can use its workers in different ways.
give engineers a new way of deciding how to build plants.
14
Which of the following is NOT a factor of production?
the children whom the woman supports with her labor
the wood frame on which the quilt is sewn
the cotton cloth and thread used in the quilt
a woman who makes a quilt
15
Shortages occur when
the United States imports more than it exports.
many people are unemployed.
interest rates go up.
people have trouble supplying the g&s at current prices.
16
All the goods and services we produce are
scarce
expensive
efficiently produced
recyclable
17
Economics is the study of how people
respond to war and drought.
gain knowledge and skills from study and experience.
calculate their income tax.
choose from limited resources to meet their needs.
18
A country's production possibilities will grow if it
lowers its opportunity costs.
produces more guns than butter.
makes more trade-offs.
increases its resources.
19
The resources used to make goods and services are called
the gross national product.
the production possibilities frontier.
opportunity costs.
factors of production.
20
Thinking at the margins means deciding about
adding or subtracting one additional unit of some resource.
investing with borrowed money.
increasing or decreasing technical know-how.
maximizing goods and services.
21
Which is NOT capital?
the person whose photo is snapped by the candid photographer
the paint used by a housepainter
the state house where state govt is conducted
the computer used by an accountant
22
Scarcity always exists because
needs and wants are not limited, but resources are limited.
changes have occurred in global weather patterns.
machines and people are inefficient.
there are more poor people than rich people.

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