Econ unit 1
What are the two important reasons that full employment is accepted as an important economic goal?
B. It provides households with an income, and it increases the level of an economy's output.
Which is NOT one of the Three Economic Questions?
How much we produce
Which of the following statements best describes the purpose of the production possibility curve?
It identifies all possible combinations of goods and services an economy can produce.
BLANK is the term used to describe a hands-off approach by the government towards the economy. This term is also time referred to as the "invisible hand of the market."
Laissez faire
Leaders who take risks to develop original ideas and start new industries are called
entrepreneurs
A traditional economy is characterized by the BLANK of goods in which two people trade their possessions with each other.
exchange
It is where all of the factors of production are bought and sol
factor market
Land, capital, labor, and entrepreneurs are?
factors of production
Land, labor, entrepreneurship and capital make up the
factors of production
Productive resources that make up the four categories of land, capital, labor, and entrepreneurship.
factors of production
T/F Communist countries like North Korea and Cuba are examples of mixed economies.
false
T/F In general, people do not want their economic system to create as many jobs as possible.
false
T/F Mixed economies work to the degree that they embrace democracy.
false
Money used to buy the tools and equipment used in production.
financial capital
How many distinct "factors of production" do economists recognize?
four
The term BLANK refers to water, forests, and all other natural resources used to produce goods and services.
gift of nature
People must make choices to satisfy their needs and wants.
goods and service are limited or scarce
Natural resources or "gifts of nature" not created by human effort: one of four factors of production.
land
The South's rainy season.
land
Businesses are owned by private individuals.
market
Competition between privately owned businesses.
market
In a Answer economy, questions of what, how, and for whom to produce are answered by the buying and selling activity of individuals.
market
The people decide what is produced.
market
The people decide what is sold.
market
BLANK economies are driven by BLANK and demand.
market supply
A system in which the factors of production are owned by private citizens is called which of the following?
market economy
What is the name of the federal health insurance program for senior citizens?
medicare
Traditional economies do not use BLANK as a medium for trade.
money
Land is best described as:
naturally occurring resources
Cost of the next best alternative use of money, time, or resources when one choice is made rather than another.
opportunity cost
The _______ of going to a football game instead of working would include the money not earned at your job.
opportunity cost
Scarcity always exists.
our needs and wants are always greater than our resource supply
Factories, machinery, and pencils are all examples of BLANK capital.
physical
Which one of these is a characteristic of a traditional economy?
predictable
Which of the following is currently considered one of the seven major economic and social goals in the United States?
price stability
The rights and privileges to control one's own possessions and ideas are?
private property right
It is where producers sell their goods and services.
product markets
A diagram that represents various possibilities of goods and services an economy can produce when all its resources are efficiently used.
production possibilities curve
All goods and services are scarce.
the land, labor and capital need to produce them are scarce
The opportunity cost of an action:
the value of the best alternative
Entrepreneurs are important to the production of goods and services.
they bring the factors of production together
Inflation causes people to _______ .
to work more to pat for necessities
When deciding how to use resources, you need to evaluate the costs and benefits of each choice to decide which meets your criteria. These are called
trade offs
Which of these is most closely associated with "opportunity cost"?
trade offs
Developing countries often face a problem in that increased production and higher living standards lead to increased environmental damage. This is an example of which of the following?
trade-offs
The alternative that must be given up when one choice is made rather than another.
trade-offs
In this economy there is very little technology.
traditional
The people use old-fashioned ideals (ideas) to decide what to buy
traditional
The way the 19th-century Inuit divided the "spoils of the hunt" demonstrates a Answer economy.
traditional
An economic system in which ritual, habit, and custom dictate most economic and social behavior is?
traditional economy
Which of the following descriptions best explains the meaning of opportunity cost?
The cost of choosing one alternative over another
Which of the statements best describes the communist ideal?
A classless society in which everyone works for the common good
Which type of economic system most accurately describes the U.S. economy?
A. a mixed economy, primarily dependent on the market system Correct
Which types of economic systems must contend with the three basic economic problems of what, how, and for whom to produce?
A. market economies Incorrect B. all of them C. centrally directed economies D. traditional economies
Protection from layoffs, illnesses, injuries or disabilities falls under the goal of _______ .
economic security
A society's organized way of providing for its people's wants and needs is:
economic system
The study of how people seek to meet their needs and wants by making choices is
economics
The increased use of robots in manufacturing can lead to trade-offs between the attainment of which two economic goals?
efficienty and full employment
Ancient rules determine what is produced for this society.
command
In a Answer economy, production questions are answered by the government.
command
The government decides what is made and sold.
command
The government owns and operates the basic industries.
command
The government tells you what you can and cannot buy.
command
The government tries to end inequalities of wealth.
command
There is very little freedom of choice.
command
In BLANK economic systems the BLANK has total control over the economy.
command government
An economic system in which a central authority makes economic decisions is:
command economy
Command economies are characteristic of nations that embrace the political ideology of BLANK
communism
Economic products designed to satisfy people's wants and needs are called?
consumer goods
People who use goods and services to satisfy their wants and needs are called?
consumers
Money allows BLANK and producers to connect with each other much more BLANK than bartering.
consumers efficiently
Developer of a new smartphone app.
entrepreneur
Which of the following is NOT a feature of a market economy?
C. Decisions are made by a central planning authority. Correct
What is the importance of a society's economic goals?
D. They provide a framework for making economic choices.
In a mixed-market economy, the government acts as all of these EXCEPT:
D. director of market activity
Entrepreneurs are:
D. the work of people who devise new products and methods of delivery of educational materials
Capital is:
D. tools use to produce other goods and services
Which of the following states an advantage of a traditional economy?
Everyone knows exactly what their function is.
T/F In the modern world, economic decisions are no longer made with reference to tradition.
False
T/F The opportunity cost of a specific choice is the same for everybody who is affected by that choice.
False
T/F U.S. economic and social goals are likely to remain unchanged in the future.
False
What does an economist mean when she says, "Resources are scarce"?
Resources are limited relative to human wants.
How is the principle of "There's No Such Thing As A Free Lunch" illustrated in a socialist economy?
Socialist economies tend to offer extensive government services but have high tax rates.
U.S. is
a mixed market economy
Which is NOT a reason that entrepreneurship benefits the economy?
a. entrepreneurs want lots of government interference.
There is an inverse relationship between energy production and the amount of clean air. This means that
as energy production increases, there is less clean air.
Economic equity is usually considered a trade-off with which economic goal?
b. efficiency
Computers used to produce magazine articles.
capital
The only factors of production that are themselves the result of earlier production are?
capital
Tools, equipment, and factories used in the production of goods and services; one of four factors of production.
capital
When people make resources for producing other goods and services they are creating
capital goods
The two categories of capital are physical and
human
A rise in the general level of prices is called?
inflation
Which one fo these is a weakness of a command economy?
inflexible
Physical capital is an important factor of production.
it can save people time and money
A third-grade teacher.
labor
People with all their abilities and efforts; one of four factors of production, does not include the entrepreneur.
labor
The manager of a car repair shop.
labor
What is one of the benefits related to economic equity?
receiving equal payoff equal work
Societies embrace various economic systems to deal with the fundamental problem of Answer
scarcity
What arises because society does not have enough resources to produce all the things people would like to have?
scarcity
Which of the following is an economic concept?
scarcity
The driving force that encourages people and organizations to try to improve their material well-being is:
self interest
Persons who perform such actions as cutting hair or teaching school are providing a
service
When producers will not or cannot offer goods and services at current prices, a BLANK occurs.
shortage
T/F Economic growth is necessary as a nation's population increases.
true
T/F Social Security is one example of how Americans have modified their free enterprise economy.
true
T/F Socialist economies include aspects of both command and free-enterprise systems.
true
T/F There is always some degree of government involvement in a mixed economy.
true
T/FThe minimum wage was established at national and state levels as the lowest legal wage that can be paid to the majority of workers.
true
Our economy is characterized by:
unlimited want and needs
The underlying cause of scarcity is:
unlimited wants and resources
What is another name for the capacity of a product to be useful?
utility
Scarcity can be avoided by making:
wants and need limited