Any human-made resource that is used to create other goods and/or services is A. a service. |
C. capital |
Why are scarcity and choice basic to the study of economics? A. because there is not an endless supply of all resources |
A. because there is not an endless supply of all resources |
Which of the following is NOT a factor of production? A. the land required for a hog farm |
D. the amount of money required to buy a car |
Something such as air, food, or shelter that is necessary for survival is a A. need. |
A. need |
Which of the following is an entrepreneur? A. a lawyer for an insurance company who wins a medical malpractice suit |
C. a computer repair shop owner who opens a second shop across town |
Physical objects such as clothes or shoes are defined as A. goods. |
A. goods |
Limited quantities of resources to meet unlimited wants is a A. shortage. |
B. scarcity |
Which of the following is an example of a shortage? A. he price of oil going up because more people are driving cars |
D. not having enough of one brand of soda in the store on Saturday because of a sale on |
Natural resources that are used to make goods and services are considered A. equipment. |
D. land |
Why are individuals, companies, and governments required to constantly make choices about how to best utilize resources? A. There is always a shortage of resources. |
B. There is always a scarcity of resources. |
Factors of production are A. all the human-made goods that are used to produce other goods and services; tools and buildings. |
B. land, labor, and capital; the three groups of resources that are used to make all goods and services. |
An example of an opportunity cost would be A. not being able to afford a family trip because the family buys a computer. |
A. not being able to afford a family trip because the family buys a computer. |
An opportunity cost is A. the most desirable alternative given up as the result of a decision. |
A. the most desirable alternative given up as the result of a decision. |
What is something you might use to help you make a choice between two seemingly equal alternatives? A. a decision at the margin |
C. a decision-making grid |
How are trade-offs and opportunity costs different? A. The opportunity cost is the most desirable trade-off. |
A. The opportunity cost is the most desirable trade-off. |
Which of the following is a guns or butter decision? A. A nation shifts money from building railroads to building highways. |
D. A nation decides to produce fewer fighter jets and more bridges. |
A phrase that refers to the trade-offs that nations face when choosing whether to produce more or less military or consumer goods is A. shortage or scarcity. |
C. guns or butter. |
Deciding whether to do or use one additional unit of some resource is A. a factor of production. |
B. thinking at the margin. |
A trade-off is A. a purchase in a marketplace. |
B. an alternative that we sacrifice when we make a decision. |
What are you doing when you make a decision at the margin? A. taking an all or nothing approach to a problem |
B. reviewing several options of how to use one additional unit of a resource |
Using fewer resources than an economy is capable of using is A. the law of decreasing costs. |
B. underutilization. |
Why are there always opportunity costs when we shift from making one product to another? A. Some resources are better suited for use in making the first product. |
A. Some resources are better suited for use in making the first product. |
A country’s production possibilities depend on A. its technological level and its available resources. |
D. all of the above. |
Production possibilities graphs are important tools for A. comparing costs and profits of producing goods and services. |
B. showing ways to use an economy’s productive resources. |
What is the name of the law that states that as we shift factors of production from making one good or service to another, the cost of producing the second item increases? A. the law of efficient production |
D. the law of increasing costs |
A production possibilities curve is a graph that shows A. alternative ways to use an economy’s resources. |
A. alternative ways to use an economy’s resources. |
The production possibilities frontier is A. the line on a production possibilities graph that shows the maximum possible output. |
A. the line on a production possibilities graph that shows the maximum possible output. |
Efficiency is A. using the maximum number of resources to produce goods and services. |
B. using resources in such a way as to maximize the production of goods and services. |
Using the factors of production to make one product always means that A. a nation can make more money. |
C. fewer resources are left to make something else. |
On a production possibilities graph, a point of underutilization would appear A. above or to the right of the production possibilities frontier. |
D. below or to the left of the production possibilities frontier. |
Chapter 1 Section Quizes
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