Unit 1: Game of Economics_Study Guide

Front

Which of the following best describes a player's role in any game?
The number of turns he or she gets to take, Actions expected of him or her, Name of his or her character, How he or she score points

Back

Actions expected of him or her

Front

Which is studied by economists to understand how resources are used? Options: Distribution, Allocation, Destruction, Collections

Back

Allocation

Front

Which of these activities is most essential to the game of economics? Production of goods and services, Reduction of waste products, Use of recyclable materials, Development of new products

Back

Production of goods and services

Front

Which of the following situations is one where the goal of efficiency is being met? When you do something with as little waste as possible, When you use up all of the available resources, When you allocate resources to people who deserve them, When you make sure you produce as much of something as possible

Back

When you do something with as little waste as possible

Front

Which of the following is an example of an allocation decision?
Options: A telephone factory converted to make computers, Coal is set aside to burn as heating fuel, A hub-and-spoke network is used to ship packages, An assembly line is used to build cars

Back

Coal is set aside to burn as heating fuel

Front

Which of the following describes a situation where the goal of security is being pursued? Consumers are protected against theft, fraud, and coercion; A company opens a new factory and employs more workers; The government establishes a retirement program for its citizens; A new government program provides food to homeless people

Back

The government establishes a retirement program for its citizens

Front

According to the circular-flow model, which of the following is NOT provided by consumers? Labor, Capital, Land, Wages

Back

Wages

Front

Which of the following best explains why the free-market system follows a circular-flow model?
- The allocation of resources affects both production and distribution
- Goods and services are constantly recycled in a circular manner
- Free choices made by consumers and producers influence each other
- Profits flow in a circular way back and forth between different producers

Back

Free choices made by consumers and producers influence each other

Front

Which of the following best explains why the government makes and enforces laws in a free-market system? Competition among producers by itself cannot ensure a wide range of consumer choices, Laws aginst theft, fraud, and coercion are needed to protect free choice, The government needs to plan efficient outcomes, Workers pressure the government to guarantee minimum wages

Back

Laws aginst theft, fraud, and coercion are needed to protect free choice

Front

Which of the following best explains why the profit motive often leads to efficiency and innovation?
- The competition to make profit drives producers to eliminate waste
- Profit gives producers more money to be able to buy better resources
- Consumers want to reduce waste in order to spend less on what they buy
- Losing money prevents producers from hiring the most efficient workers

Back

The competition to make profit drives producers to eliminate waste