Economics - Unit 1 Review

Which of the following is not a factor of production?

Anticipation of a reward or fear of a penalty encouraging a person to behave in a certain way.

Which of the following is one way that the government encourage technological progress

What kind of government makes all decisions in an economy?

A country's maximum possible output of various good plotted on a graph is called:

Market failure refers to:

The central problem of economics, without which economics would be unecessary

On a PPF, a point that appears below (inside of) the production possibilities curve indicates:

Why does every decision involve a trade-off?

The arena of exchange in which firms purchase the factors of production from households

Poverty threshold refers to:

Which of the following is the best example of a public good?

When consumers want more of an item than producers are willing to produce at a particular price

The economic side-effect of a good or service being produced

What is one of the most important advantages of a free-market?

Concentration of productive efforts on a limited number of activities:

A decision is made on the margin when each alternative considers

The curve (not linear) usually seen in a production possibilities frontier can be explained by:

Human capital refers to:

Eminent domain refers to:

What is NOT one of the 3 key questions that an economic system must answer?

Who makes economic trade-offs?

Bob's test score improved by 8% by spending an extra hour studying. The gain from 1 hour added 

The next best alternative given up when a decision is made:

What happens as production of one item switches to the production of another item?

The principle that people have the right to control their possessions as they wish