Chapter 1.1 Assessment (The Basic Problem in Economics)

The study of how people use limited resources to fulfill their unlimited wants.

• Economics

• Microeconomics

• Macroeconomics

• None of these answers are correct

Deals with behavior and decision making by small units such as individuals.

• Economics

• Microeconomics

• Macroeconomics

• None of these answers are correct

Deals with the economy as a whole and decision making by large units such as governments.

• Economics

• Microeconomics

• Macroeconomics

• None of these answers are correct

To an economist, anything other than what people need for basic survival is a...

• need

• want

Water is an example of a...

• need

• want

Everything that exists is...

• limited

• unlimited

• somewhat limited

Means people do not and cannot have enough income and time to satisfy their every want.

• scarcity

• factors of production

• land

• ownership

Resources needed to produce goods and services.

• scarcity

• factors of production

• land

• ownership

Natural resources that exist without human intervention.

• scarcity

• factors of production

• land

• ownership

The work people do.

• labor

• goods

• services