Economics Chapter 1 Test Review

What are the four factors of production

The Catholic teaching that nothing should be done at a higher level that can be done well or better at a lower level.

Assignment of tasks to the workers, factories, regions, or nations that can perform them more efficiently.

A business that is employing all of its productive facilities is at

Way of thinking about a choice that compares the cost of an action to its benefits.

Sum of tangible economic goods that are scarce, useful and transferable from one person to another.

The loss of the second best option is the

Diagram representing the maximum combos of goods/services an economy can produce when all resources are fully employed.

Who answers the questions WHAT? HOW? FOR WHOM? in a free enterprise economy?

A Production Possibilities Curve

Dollar value of all final goods, services, and structures produced within a country's borders during a one-year period.

Ability or capacity of a good or service to be useful and give satisfaction.

As consumers, we participate in the flow of economic activity by

Alternative that is available whenever a choice is to be made.

Measure of the amount of output produced with a given amount of productive factors.

Specialization can lead to

We use decision-making tools to

Adam Smith’s idea that resources make their way to where they need to be because of a producer's self-interest

We study economics to

Social science dealing with how people satisfy seemingly unlimited wants and needs with limited resources.

Look at the graph. What represents the opportunity cost in wine given up when we move from point A to B?

A company producing at point X on the curve represents

Economics helps us answer these questions:

What is scarcity?

The quality by virtue of which person or persons create laws, give orders, and expect obedience.

Productive resources that make up the four categories of land, capital, labor, and entrepreneurs.

Fundamental economic problem of meeting people's virtually unlimited wants with scarce resources.

Adam Smith believed this to be the source of our nation's wealth.

If something has utility it is

According to the Catechism, authority is necessary because

Cost-benefit analysis is used to

Economic Growth can lead to

The person who first voiced the idea of division of labor was

Most important factor for productivity is

Tools, equipment, and factories used in the production of goods and services.

To receive full credit for my short answer and essay questions I should use

Increase in a nation's total output of goods and services over time.

We will make decisions based on greed, convenience, materialism, control, comfort unless we

Choices can have a cost in dollars and cents and a cost of

What about a product causes it to command a price?

Monetary worth of a good or service as determined by the market.

The observation that some necessities have low value while non-necessities have higher value

Have you studied your vocabulary for the test tomorrow ?

Two decision making tools in economics are

In the circular flow of economic, businesses buy these, create these, and end with this.