Unit 1 Pre Test

Front

Which of the following best explains why scarcity is a fundamental economic problem for all societies? Because governments always have limited budgets., Because human wants and needs are unlimited, while resources are finite., Because some individuals in society are wealthier than others., Because international trade creates competition for resources.

Back

Because human wants and needs are unlimited, while resources are finite.

Front

The basic economic problem of choice arises directly from which underlying condition?

Back

The presence of scarcity

Front

In a market economy, the question of "what to produce" is primarily determined by:

Back

The interactions of supply and demand.

Front

A society decides to increase its production of agricultural goods by implementing more efficient irrigation systems and farming techniques. This decision primarily addresses which of the basic economic questions?

Back

How to produce?

Front

In a command economy, how is the question of "for whom to produce" typically answered?

Back

Through a centralized government plan that allocates goods and services.

Front

Which of the following is the best example of the economic factor of production known as "land"? A factory building used to manufacture cars. The skills and knowledge of a software engineer. A deposit of natural gas located beneath the earth's surface. The owner who starts a new restaurant.

Back

A deposit of natural gas located beneath the earth's surface.

Front

The effort and skills of a construction worker on a building site would be classified under which factor of production?

Back

Labor

Front

Which of the following represents "capital" as an economic factor of production? The money used to start a new business. A company's stock shares traded on the stock market. A delivery truck used by a bakery. The intellectual property of a technology firm.

Back

A delivery truck used by a bakery.

Front

An individual who takes the risk of starting a new online retail business, develops a unique marketing strategy, and manages the operations is best described as:

Back

An entrepreneur.

Front

A society with abundant natural resources must still grapple with the problem of scarcity because:

Back

Human desires for goods and services derived from those resources are unlimited.