Economics Final
Why is economics considered a dynamic science? Select ALL that apply.
The economy is always changing. Human behavior is always changing.
What three basic economic questions must all societies answer? Select ALL that apply.
What to produce? How to produce? For whom to produce?
What does the gross domestic product measure?
a country's total output
scarcity
a fundamental problem in every society
Examples of idle resources include _________________________. Select ALL that apply.
a labor strike an empty factory
A consumer's opportunity cost differs from a business's opportunity cost in that it is associated with _________________________.
an item not purchased
The purpose of an economic model is to _________________________. Select ALL that apply.
analyze economic activity predict economic activity describe economic activity
Who was Adam Smith?
author of Wealth of Nations
The relationship between markets can best be described as_________________________.
circular
specialization
each worker learns one task very well each worker learns one task very well standard of living
When a business owner hires someone to run the cash register, that person and the business owner are participating in the _________________________.
factor market
What are the four factors of production?
land, capital, labor, entrepreneurs
capital good
manufactured good used to produce other goods or services
gross domestic product
measures a country's output and economic health
consumerism
movement that promoted the rights of buyers
What term describes the difference in value between the best option and the next best alternative that was not chosen?
opportunity cost
The two broad groups of people whose choices drive the economy are_________________________.
producers and consumers
A production possibilities curve diagrams all possible combinations of goods and services an economy can produce when _________________________.
productive resources are fully employed
standard of living
quality of life quality of life
economic interdependence
reliance on others to produce goods and services we need
production possibilities curve
represents the range of production possibilities
Economics is the study of how people try to satisfy their wants and needs through the careful use of _________________________.
scarce resources
What was the purpose of the consumerism movement that started in the 1960s? Select ALL that apply.
to expect higher quality products to demand safer products to educate buyers about purchases
Economists measure economic growth by examining _________________________.
total output of goods and services over time
What two characteristics must an item possess to have monetary value?
utility and scarcity
factor market
where all of the factors of production are bought and sold
nondurable goods
food is an example of one
What term describes a society in which the majority of economic choices are made without government interference?
free enterprise
In the United States, consumer spending influences what type of economic decision?
goods to produce
Paradox of value refers to the
high value of a nonessential item and the low value of an essential item.
What are the effects of specialization? Select ALL that apply.
increased efficiency economic interdependence
