Introductory Economic Terms (Scarcity, Opp. Cost, P.P.F.)

Choosing to make cars instead of trucks results in

• opportunity cost
• increased wealth
• expanding the production possibilities curve
• TINSTAAFL rating upgrade

What is the fundamental problem of every society?

• labor costs
• scarcity
• economic interdependence
• market fluctuation

________ is the most basic economic problem.

• Scarcity
• Labor
• Greed
• Capital

Opportunity Cost is best defined as

• The best rejected alternative you give up when making a decision 
• The price you pay to purchase something 
• The benefit you gain by making a decision 
• The amount of debt you take on by making a decision 

Which of the following statements is true: 

• An economist would consider something scarce only if it is limited (not anything else) 
• A trade off occurs when you give up something you want in order to get something else you want 
• The economic social goal, economic equity, means everyone gets the same amount of money 
• In a traditional economy, the government gets to decide the answers to the 3 basic economic questions

Which of the following would be an example of human capital? 

• The amount of workers who work in a Nike factory
• The skills of the shoe designers at Nike 
• Philip Knight, the CEO of Nike 
• The land that the Nike headquarters is located on in Beaverton Oregon

Which of the following is a need?

• clothes
• car
• job
• smart phone

How do you satisfy your unlimited wants in a world of limited resources?

• by making more money
• by making trade-offs (economic decisions)

• by stealing
• by setting a budget

Antonio has an Economic test tomorrow and knows that if he stays up and studies until 11 p.m. he has a good chance of making an A on the test.  However he is really tired and knows that if he goes to bed at 10:00 p.m. he can easily make a B on the exam.  What is Antonio's opportunity cost if he goes to bed at 11:00 p.m.

• An A on the exam 
• making a B on the exam 
• Losing one hour of sleep
• gaining one hour of sleep

 The difference between a good and a service is that:

• Goods are available in unlimited quantaties and services are not 
• Goods are tangible and services are not 
• Services are available in unlimited quantaties and goods are not 
• goods help satisfy unlimited wants and services do not