SSEF1 Fundamentals Summative Assessment

In economics, rational decisions occur when
                                                             SSEF2b

• suppliers lower their prices to increase demand
• marginal benefits of an action equal or exceed the marginal costs
• a budget is used for spending and saving decisions
• command economies answer the three basic questions

Which is a human resource that Ms. Johnson could use for her art gallery?
SSEF1b

• Light fixtures to help display the artwork.
• A security system to protect the artwork.
• Knowledge of trends in modern art.
• A series of paintings by a prominent local artist.

Which is a fundamental questions every society must answer?
SSEF1a

• What goods and services are to be produced?
• How are the goods and services to be produced?
• Who will get the goods and services that are produced?
• All of the above

A and B both wash cars and change oil. Currently, each man washes and changes oil by himself, but the process takes lots of time. they would MOST LIKELY improve their efficiency if
SSEF2b

• A & B wash a car and chang eoil together
• A washes car while B changes oil
• A washes B car while B washes A's car
• A and B reduce the number of cars they wash

Susan offers to trade her old iPod for Claudia's cell phone and Claudia accepts. Assuming both products work perfectly, we can conclude that
SSEF3b

• Claudia is now happier than Susan.
• neither party has gained because the exchange was fraudulent
• both people have gained because the exchange was voluntary and non-fraudulent
• Susan places the same value on cell phones as she does for iPods

Which provides the greatest incentive for entrepreneurs to take risks?
SSEF1c

• prices
• inflation
• profits
• interest

A production possibilities curve shows
SSEF6d

• the technological changes that improve production
• choices a person makes between items
• all of society’s resources
• the combination of goods that can be produced with a set of resources

If the producer in the PPC seen here is producing at point X, moving to point Z would mean an opportunity cost of
SSEF1d

• 3 pounds of cheese
• 7 pounds of cheese
• 10 gallons of milk
• 20 gallons of milk

Scarcity means:

• Too much of something you wanted

• The exact amount of something you wanted

• Not enough of something you wanted

What is an economic want?

• Things people need in order to survive.

• Things people would like to have.

• Things people don't want anymore.