Economics Unit 1

An estimation of revenue and expenses over a specified period of time is known as

A budget

The former Soviet Union was an example of:

A command economy

Resources

factors or supplies from which benefit is produced, including such items as raw materials, energy, services, human labor, and knowledge.

Want

goods or services that are not necessary but that bring enjoyment.

Capital

one of the three factors of production, capital is the wealth, buildings, machinery and equipment owned by a business used to produce goods and services.

Scarcity

the idea that there are limited amounts of resources for an unlimited amount of wants and needs.

Well-being

the state of being healthy, happy and prosperous.

Economics

the study of how people make decisions on satisfying their wants and needs.

Supply

the total amount of a particular good or service available to consumers.

Which of the following is true about entrepreneurs and risk?

Entrepreneurs face high rates of risk.

The possibility that prices will rise in the future and that a business needs to plan for this is an example of:

Known risk

Comparing the benefits and costs of choosing a little more or a little less of a good is known as:

Marginal analysis

A type of agriculture in which the farmers focus on growing enough food to feed themselves and their families is known as:

Subsistence agriculture

Not using a resource efficiently or to the maximum potential value is known as:

Underutilization.

A tornado that destroys a factory would be considered to be an example of:

Unknown risk

Which of the following is NOT one of the four basic economic questions that each society must answer?

Where should factories be located?

Choice

a decision in which one alternative is selected over others.

Producer

a person or organization that creates goods and services.

An economy in which production, investment, prices, and wages are dictated by a government is known as:

A command economy.

An economy in which elements of both private enterprise and government intervention are present is known as:

A mixed economy

If a grocery store started advertising boxes of a popular breakfast cereal that normally sells for $4 at the new price of ten cents, the likely result would be:

A shortage.

A company in its first stage of its operations is often called:

A startup

A preference for known risks over unknown risks is best described a s follows:

Ambiguity aversion

A business professional who deals with the measurement and management of risk and uncertainty is best described as follows:

An actuary

Changes to which of the following does NOT result in a movement of the production possibilities curve?

An increase in demand for products.

Which of the following is NOT true about entrepreneurs and financing their new business?

Banks are very willing to loan money to entrepreneurs for their companies.

The change between the satisfaction you receive from drinking a first can of soda versus a fifth can of soda describes the concept known as:

Diminishing marginal utility

Which of the following is most accurate about starting a new business?

Entrepreneurs lose the security of a regular paycheck

Which of the following is most accurate about entrepreneurs and knowledge about the business?

Entrepreneurs need to be able to hire professionals for many aspects of their businesses.

The following statement best reflects entrepreneurs and delegation of responsibility:

Entrepreneurs need to be careful of what they delegate to employees.

Money used to start a company would be considered to be a form of:

Financial capital

A fundamental problem in economics is that human beings:

Have unlimited wants, but limited resources

A fundamental problem in economics is that human beings:

Have unlimited wants, but limited resources.

The workers at an automobile manufacturing plant would be considered to be a form of:

Human capital

The cost added by producing or consuming one extra item of a product is best described as:

Marginal cost.

The gain from an increase (or loss from a decrease) in the consumption of a good or service is known as:

Marginal utility.

An economy in which production, distribution, and exchange are controlled by individuals and businesses is known as:

Market economy

Which of the following is NOT true about a command economy?

Markets determine supply, demand, and price.

If Jacob decided to go to three movies one week instead of attending a more expensive concert, that concert would represent the following concept:

Opportunity cost.

Which of the following would be considered a land resource?

Petroleum.

The amount of money that has to be paid to acquire a given product or service is best expressed by the following term

Price

A measure of the effectiveness of productive effort is known as:

Productivity

The possibility that something of value may be lost is known as:

Risk

The idea that there are limited resources for an unlimited amount of wants and needs is best expressed by the following term:

Scarcity

The connections and relationships a salesperson developed would be considered to be a form of:

Social capital

Which of the following would NOT be a characteristic of an entrepreneur?

Someone who exhibits risk aversion.

The total satisfaction received from consuming a good or service is known as"

Utility.

Consumer

a person or organization that acquires goods or services for direct use rather than for resale or use in manufacturing.

Shortage

a situation where the quantity demanded is greater than the quantity supplied.

Surplus

a situation where the quantity supplied is greater than the quantity demanded.

Services

actions or activities that people pay other people to perform; examples or professions in the service sector might include hair stylists, lawyers, plumbers, or child care workers.

Demand

amount of desire for a particular good or service.

The full-time job not worked by a college student (and the waged not earned) because she has to spend a lot of time studying is an example of:

opportunity cost

Goods

physical objects produced for consumption, such as books or automobiles.

Need

something necessary for survival, such as food, water, and shelter.

Factors of production

the inputs used in the production of goods or services; these include land, labor, and capital.