Econ Unit 1 Quiz

The term that can be defined as the loss of the next best use of resources is:

• Opportunity Cost

• Scarcity

• Capital

• Cost Efficient Production

Why do people have to make choices?

• People have unlimited wants and scarce resources.

• People have limited wants and needs.

• All governments ration who receives scarce resources.

• Opportunity costs must always be paid.

Economics, as a field of study, is BEST described as

• How people deal with investment alternatives

• How everyone spends their money

• How government controls the money supply

• How society deals with the problem of scarcity

Which of the following is a problem faced by ALL economic systems?

• Federal debt

• Scarcity

• Poverty

• Inflation

The term underutilization can be defined as

• What you give up or what you did not choose

• The use of fewer resources than the economy is capable of using

• The right to produce goods or services

• The act of buyers and sellers coming together willingly in the market place

A good that is used to help increase future production can be defined as:

• Capital good

• Consumer good

• Natural good

• Artificial good

Which of the following is correctly matched?

• Labor = Profit

• Land = Rent

• Capital = Wages

• Entrepreneur = Interest

True or False: A coffee maker is an example of a capital good and the coffee is an example of a consumer good.

• True

• False

A production point on the Production Possibilities Curve means:

• The resources are being underutilized (wasted)

• The resources are being used efficiently

• There are not enough resources

A production point inside the Production Possibilities Curve means:

• The resources are being underutilized (wasted)

• The resources are being used efficiently

• There are not enough resources