A government payment to support a business or market

What are “goods and services”?

Physical products and intangible activities that satisfy consumer needs

What is equilibrium price?

The price at which quantity demanded equals quantity supplied

What is macroeconomics?

The study of the economy as a whole

What did John Maynard Keynes believe about government involvement in the economy?

Government should intervene during economic downturns

What is the ultimate goal of communism, according to Marxist theory?

A society where wealth is distributed equally and the state withers away

What is deficit spending?

When the government spends more money than it collects in revenue

What is human capital?

Knowledge and skills, of workers that contributies to economic productivity

How do you define “capital”?

Physical tools, machinery, and money used to produce goods and services

What are “product markets”?

Markets where final goods and services are sold to consumers

What is the primary goal of a business in a market economy?

To maximize profits by efficiently using resources

What is a public good?

Provided by the government that benefits everyone, like roads and parks

A tax on imported or exported goods

What are “resource markets”?

Where factors of production (land, labor, and capital) are bought and sold

What did Karl Marx believe about the government and the economy?

Government should control all production and distribution

The total amount of money a business earns before expenses

What is microeconomics?

The study of individual consumers and businesses

What is a potential negative consequence of imposing tariffs?

Higher prices for consumers on imported goods

What are wants and needs?

Needs are essential for survival; wants are desires beyond basic needs

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Economics Basics 2

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Questions 20

Answers

1
What is a subsidy?
A type of private investment
A government payment to support a business or market
A tax on imported goods
A fee paid by businesses to operate legally
2
What are “goods and services”?
Only services like banking and healthcare
Government-provided items
Only physical products like food and clothing
Physical products and intangible activities that satisfy consumer needs
3
What is equilibrium price?
The price at which quantity demanded equals quantity supplied
The highest price a seller can legally charge
The price that remains constant over time
The price set by the government in a command economy
4
What is macroeconomics?
The study of only stock market trends
The study of household finances
The study of individual markets
The study of the economy as a whole
5
What did John Maynard Keynes believe about government involvement in the economy?
Government should intervene during economic downturns
The economy should be controlled by private companies
Inflation is not affected by government policies
Government should never interfere in the economy
6
What is the ultimate goal of communism, according to Marxist theory?
A monarchy that controls the economy
A permanent dictatorship to manage resources
A free market with minimal government intervention
A society where wealth is distributed equally and the state withers away
7
What is deficit spending?
When supply exceeds demand
When the government spends more money than it collects in revenue
When businesses lower prices below production costs
When individuals spend more than they earn
8
What is human capital?
The amount of goods produced in a country
The physical tools and machinery used in production
The total amount of money in circulation
Knowledge and skills, of workers that contributies to economic productivity
9
How do you define “capital”?
Only money used in business transactions
The total wealth of a nation
The value of all imported goods
Physical tools, machinery, and money used to produce goods and services
10
What are “product markets”?
Markets where final goods and services are sold to consumers
Markets where only raw materials are traded
Places where businesses buy resources
Government-controlled markets
11
What is the primary goal of a business in a market economy?
To eliminate competition
To provide goods and services at no cost
To follow government-set prices
To maximize profits by efficiently using resources
12
What is a public good?
A product that can only be used by one person at a time
A good that private businesses sell
Provided by the government that benefits everyone, like roads and parks
A type of government tax on businesses
13
What is a tariff?
A fee businesses pay for licensing
A tax on imported or exported goods
A type of loan given by the government
A limit on how much businesses can charge for products
14
What are “resource markets”?
Only international trading hubs
Where factors of production (land, labor, and capital) are bought and sold
Places where consumers buy finished goods
Markets that only sell natural resources
15
What did Karl Marx believe about the government and the economy?
Government should control all production and distribution
Free markets should dictate prices
Government should have no economic role
Private property leads to economic growth
16
What is revenue?
The total amount of money a business earns before expenses
The amount of money left after paying taxes
A government-imposed tax on businesses
The profit a business makes after expenses
17
What is microeconomics?
The study of government spending
The study of inflation and unemployment
The study of individual consumers and businesses
The study of the entire global economy
18
Which major historical event heavily influenced Keynes' economic theories?
The American Revolution
The Great Depression
The Fall of the Roman Empire
The Industrial Revolution
19
What is a potential negative consequence of imposing tariffs?
Decreased government revenue
Increased unemployment in protected industries
Strengthened international trade relationships
Higher prices for consumers on imported goods
20
What are wants and needs?
Needs can always be ignored
Wants are more important than needs
Needs are essential for survival; wants are desires beyond basic needs
There is no difference between wants and needs

Economics Basics 2 Flashcards | StudBud