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Chapter 1: The Economic Way of Thinking Flashcards | StudBud
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Chapter 1: The Economic Way of Thinking
Chapter 1: The Economic Way of Thinking
30 terms
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#basic economic concepts
Flashcards
30 cards
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Practice quiz
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Questions
30
Answers
1
What does a point inside the PPC indicate?
more resources are required
not all resources are fully employed
all resources are fully employed
less resources are required
2
Which of the following best describes a want?
unlimited and never changes
limited and ever changing
limited and never changes
unlimited and ever changing
3
What does the saying "There is no such thing as a free lunch" mean?
everything costs something
most things cost something
most things have little cost
some things costs more than others
4
Which of the following would NOT push the PPC outward?
Increased labor resources
New technology for more efficient production
more trade-offs
Additional natural resources
5
The satisfaction received from using one more unit of a good or service is called....
opportunity cost
marginal benefit
marginal cost
trade-off
6
A combination of companies that make the same product or service.
vertical merger
conglomerate merger
horizontal merger
linear merger
7
Public parks, libraries and swimming pools are considered _______________ wants.
collective
comparative
reoccurring
complementary
8
Which of the following is NOT true about
partnerships
?
has unlimited liability
Has high government regulation
has limited life
a Lancaster example would be a Lancaster Dental Associates
9
Which of the following buys goods for personal use?
entrepreneur
consumer
client
producer
10
Which of the following is NOT an advantage of a
market economy
?
It awards only productive services
private property rights
Consumer choice is high
can adapt to change quickly
11
He is considered the "Father" of modern market system economies.
Karl Marx
Adam Smith
Tom Marx
John Smith
12
Goods that go together are said to be.......
complimentary goods
comparative goods
public goods
neutral goods
13
Into what four categories do economists divide the factors of production?
land, labor, capital and money
land, labor, money and enterprise
resources, clients, money and enterprise
land, labor, capital and entrepreneurship
14
Which is NOT true about the government in the US?
It serves as the planner
It serves as the protector
It serves as a producer
It serves as a consumer
15
What does the production possibilities curve (PPC) illustrate?
economies of scale
opportunity cost
utility and satisfaction
efficiencies
16
Which of the following is feature of
perfect competition
?
Product/service is identical with many close substitutes
Difficult entry and exit into the market
Has total influence over price
An example wold be car producers
17
Which is NOT a feature of a
corporation
?
Has limited liability
The largest number of business organizations in the US
Has the highest form of government regulation
Has unlimited life
18
To be a successful entrepreneur requires a willingness to......
play it safe
borrow money
limit spending
take risks
19
The fundamental economic problem is.......
wants
costs
underutilization
scarcity
20
Which is NOT considered a need?
food
shelter
clothing
television
21
Adam Smith's concept that an "invisible hand" will guide the economy.
laissez faire
ceteris paribus
quid pro quo
carpe diem
22
Which of the following is NOT a feature of a
monopoly
?
Considered a 'price taker"
Sells a product/service with no close substitute
Difficult entry into the market
An example would be Fireball Lanes
23
Which is NOT a disadvantage of a
command economy
?
Economic decisions could be incorrect
Little incentive for worker productivity
No incentive to use resources wisely
It seeks to provide for everyone
24
From the choices given, and by it's true definition, the best example of capital is would be...
job-training
a raise in wages
a chef
a tractor
25
Which of the following is NOT a basic economic question answered by different economic systems?
When to produce?
For whom to produce?
How to produce?
What to produce?
26
Opportunity cost is the ______________ of a trade off.
utility
efficiency
value
scarcity
27
Which is NOT a feature of a
traditional economy
?
Little disagreement over economic roles
Unpredictable
Resists change
Less personal choice
28
Economics is best defined as the study of......
equilibrium
utility
satisfying unlimited wants with limited resources
supply and demand
29
The PPC curve is bowed in shape because of....
the law of underutilization
the law of law of increasing opportunity costs
the law of scarcity
the law of efficiency
30
An example of a trade-off is.....
going to a movie that your favorite actor is in
giving up going to a movie to study
going to a movie because of good reviews
giving up going to a movie because of bad reviews
