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ECON Unit 1 Review Flashcards | StudBud
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ECON Unit 1 Review
ECON Unit 1 Review
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Answers
1
One of the characteristics of a capitalist free enterprise economy is
voluntary exchange.
consumerism.
central planning.
the minimum wage.
2
Which of these do economists use to illustrate combinations of output?
a division of labor
a cost-benefit analysis
a factor of production
a production possibilities curve
3
In a command economy, how is it determined what goods and services will be produced?
Businesses decide what to produce on the basis of market conditions.
Consumers decide through their behavior in the marketplace.
Central government planning decides what will be produced.
Supply and demand control production and price.
4
Consumers waiting in long lines for a new product is an example of
consumerism.
consumer rights.
consumer responsibilities.
scarcity.
5
The three synonymous terms to describe the US economic system are free enterprise, capitalism, and
economic freedom.
limited role of government.
free market.
competition.
6
Inflation causes people to
take more time off work.
spend less for the same amount of goods and services.
work the same hours for the same pay.
work more to pay for basic necessities.
7
How does the government operate in a free enterprise economy?
It tells businesses what to produce and what to sell.
It takes a “hands off” approach to business.
It interferes with business only when it is profitable.
It establishes laws and rules to maintain competition.
8
When a business needs to decide whether a certain action is worth the cost, the most helpful analysis would be a(n)
needs assessment.
production possibilities comparison.
economic model.
cost-benefit analysis.
9
Consumers can influence the production and sale of goods by
“voting” with their dollars.
paying off their debts.
saving their money.
reducing their spending habits.
10
Which of the following helps determine something’s value?
utility
utility and scarcity
scarcity
beauty
11
What is one of the benefits related to economic equity?
conserving resources
unemployment compensation programs
living on a fixed income
receiving equal pay for equal work
12
Which of these statements best describes the communist ideal?
society where the working class is motivated by incentives to produce goods
classless society where everyone works for the common good
society where a small ruling class administers resources for common good
classless society where workers are motivated by financial incentives
13
In which system is the gov't most likely to provide ppl with goods/services they could not otherwise afford?
a traditional economy
a socialist economy
a free-enterprise economy
a market economy
14
Division of labor is practiced because
it prevents specialization.
it increases efficiency by ensuring all workers become good at every task.
it increases efficiency by ensuring that workers are good at certain tasks
companies do not want workers to talk to one another.
15
One advantage of a market economy is its ability to
control the price of labor.
adjust to changes over time.
sell goods at a high price.
limit consumer choices.
