Economics: Semester Review

Scarcity arises because all societies have 

• limited productive resources to satisfy unlimited wants
• unlimited productive resources to satisfy limited wants
• limited needs and unlimited wants
• unlimited needs and wants

Economics is the study of how

• gov't allocates scarce resources to satisfy people's unlimited wants.
• gov't supplies money to businesses to produce goods & services
• people use their scarce resources to satisfy their unlimited wants
• businesses supply unlimited goods & services with limited resources

An individual who tries to earn a profit by developing a new product or finding a better  way to produce an existing one is a(n)

• employee
• manager
• entrepreneur
• executive

A study that examines how price & output are determined in the market for breakfast cereal would involve 

• socioeconomics
• microeconomics
• marginal economics
• macreconomics

The opportunity cost of a chosen item or activity is

• the money you must give up to buy it
• the value of all alternatives you must pass up
• the value of best alternative you must pass up
• the money you lost by not choosing the least expensive option

A cost that you have already paid and cannot recover is known as a

• normative cost
• positive cost
• negative cost
• sunk cost

To decide whether to have dessert, you consider the extra time you would spend eating the dessert and the extra calories, both of which are part of the _ of this decision.

• opportunity cost
• capital cost
• marginal cost
• sunk cost

A study of total consumption in the US economy would involve

• normative economics
• microeconomics
• consumer economics
• macroeconomics

Which of the following is NOT true of a pure market economy?

• resource owners have property rights
• markets are regulated by government
• prices guide resources to the most productive use
• markets answer the what, how, and for whom questions

In a market economy, what right give resource owners the freedom to use their resources as they see fit?

• monopoly rights
• voting rights
• property rights
• economic rights