Economics & Personal Finance Post Test Review

Front

Why could the argument be made that the basic economic problems of scarcity and choice are faced by every society?

Back

Scarcity and choice are basic economic problems in every society because all people, regardless of economic status, have unlimited wants, but resources are limited.

Front

Sue wants to buy apples from the local farmers’ market, but they are out of season. What economic principle is implied by this example, and why?

Back

The apples out of season show the economic principle of opportunity cost because of people wanting to buy apples but having to choose something else.

Front

Annie is producing sugar-free lemonade pops to sell. Based on an examination of the image, why would Annie need to consider the economic factors of production before providing goods or services?

Back

Annie needs to ensure she has all the materials needed to produce her lemonade pops, enough employees to meet the demand for her pops, and enough money to pay all her business expenses.

Front

Which scenario best illustrates a trade-off resulting in an opportunity cost? Options: Tom has not seen his friends in three days because he really enjoys playing video games, so playing video games is his opportunity cost. Tom had a trip planned to Peru but his trip was canceled due to inclement weather, so the trip to Peru was his opportunity cost. Tom has to study for an exam but decides to take a nap before his exam, so taking a nap is his opportunity cost. Tom has $3.00 left in his grocery fund and chooses to buy ketchup instead of mustard, so not having mustard this month is his opportunity cost.

Back

Tom has $3.00 left in his grocery fund and chooses to buy ketchup instead of mustard, so not having mustard this month is his opportunity cost.

Front

The term capitalism is synonymous with—

Back

free enterprise

Front

The activity shown in the photograph results in—

Back

limits on business use of property

Front

What conclusion is supported by the information in the table? Options: Government regulation has decreased over time., Government regulation has increased over time., Government regulation is restricted to purely economic areas., Government regulation is solely concerned with health and safety.

Back

Government regulation has increased over time.

Front

The supply schedule reflects the law of supply by—

Back

showing increased supply as prices increase

Front

Why is raising gasoline prices when there is a shortage an effective use of responsive pricing?

Back

It reduces demand for gasoline.

Front

Considering the relationship between input costs and changes in supply, what is the most likely outcome of an economic forecast predicting an increase in the price of smartphones?

Back

Companies that produce smartphones will hold back stock until the price increase occurs.