Goard Economics Test Review

What is economics?

• A science that analyzes how individuals, companies, or nations make choices about the production and consumption of goods

• Boring

• The study of money

• Split into microeconomics and macroeconomics

What idea says that we have an unlimited amount of wants but a limited amount of available resources?

• Trade

• Economics

• Scarcity

• Opportunity cost

Because scarcity exists, how do we acquire the things we can't produce on our own?

• Steal

• Trade

• Borrow

• Barter

Which group would most likely have a traditional economy?

• Citizens of a nation ruled by a dictator and a very powerful government

• Citizens of a nation based on democracy and the idea of limited government

• Ancient Native American tribes

Why do businesses specialize in certain goods/services?

• Self-interest

• Efficiency & trade

• Profit

• They'll donate what they don't use

If you have an absolute advantage, you make _________ goods than someone else.

• More

• Less

• The same

If you have a comparative advantage, you make _________ goods than someone else, but your opportunity cost (gap) is ___________ in that item.

• Less; bigger

• More; bigger

• More; smaller

• Less; smaller

Where are inefficient production points on a Production Possibilities Frontier located?

• Inside the curve

• On the line

• Outside the curve

• Above the line

Where are efficient production points on a Production Possibilities Frontier located?

• Inside the curve

• On the line

• Outside the curve

• Above the line

Microeconomics focuses on whom?

• The economy as a whole?

• Governments and individuals

• Individuals only

• Businesses and individuals