ECON Common Quiz 1 (Ch. 1-4)

Which of the following are Factors of Production? (choose all that apply)

• primary sources

• capital resources

• human resources

• consumer products

What is scarcity?

• unlimited wants and needs that can't be met due to limited resources

• situation where a good or service is unavailable for a period of time

• capital resources are abundant, but natural resources are not

• human resources match the needs and wants of society

If a business owner offers a $50 bonus to his sales team for every 10 sales made, this is a _

• government regulation

• unintended consequences

• profit

• incentive

On the Production Possibilities curve, why is point "X" not a good outcome for this nation?

• points inside the curve show that resources were saved

• points inside the curve are impossible

• points inside the curve show inefficiency- they could've produced more

• points inside the curve show only positive results

In what economic system would the government control all factors of production?

• captilism

• communism

• free enterprise

• democratic socialism

As a consumer, you have decided to spend $50 for a pair of shoes. What is the opportunity cost?

• the tax you paid for the shoes

• other things you may have purchased instead

• the cost of the shoes

• the gas you used to drive to the shoe store

According to the Law of Supply, as prices rise

• quantity supplied also rises

• quantity supplied decreases

• quantity supplied is unchanged

• quantity demanded increases

If the price of Coke increases significantly, many Coke drinkers will choose to buy Pepsi instead. This is an example of

• complementary goods

• diminishing marginal utility

• substitution effect

• income effect

What are the three questions producers must answer in production of goods?

• Who, What, When to produce?

• Why, where, how to produce?

• What, How, for whom to produce?

• When, Where, What to produce

Since production and supply are determined by price, we know that ____ is the basis of any business.

• need to save the world

• profit motive

• market effect

• elasticity