Economics Final Review

Front

Which of the following is a characteristic of the U.S. free enterprise system?
Government controls prices,
No private property rights,
Competition among businesses,
Central planning of resources

Back

Competition among businesses

Front

What does the production-possibilities curve illustrate?

Back

Opportunity cost and scarcity

Front

Which economic philosopher is known for advocating free markets with minimal government intervention?

Back

Adam Smith

Front

How does the circular flow model represent households?

Back

Households are represented as consumers providing labor to firms in exchange for income.

Front

What is the primary problem of scarcity?

Back

limited resources and unlimited human wants.

Front

How do incentives drive economic decision-making in a free enterprise system?

Back

Incentives drive economic decision-making by motivating individuals and businesses to act in ways that maximize their benefits and minimize their costs.

Front

Which of the following best describes economic freedom in the U.S. free enterprise system?

Back

Economic freedom allows individuals and businesses to make their own economic choices with minimal government intervention.

Front

What role does government play in a free enterprise system?

Back

The government establishes rules, protects rights, and regulates to ensure fair competition in a free enterprise system.

Front

How does a production possibilities curve (PPC) demonstrate efficiency?

Back

A PPC demonstrates efficiency by showing the maximum output combinations of two goods that can be produced with available resources.

Front

What does a point inside the production possibilities curve represent?

Back

Inefficient use of resources.