Principles of Business Chapter 2

Resources are the things necessary for making only what people need.

• True

• False

Every type of business needs labor resources to produce goods and provide services.

• True

• False

Answer explanation

Can't have production without people to do the producing.

Entrepreneurial resources are different from labor resources.

• True

• False

Answer explanation

Entrepreneurial resources are used by the people who that the risk to start a business. Labor resources are the people who work the the entrepreneur.

Every society has enough productive resources to produce everything people want and need.

• True

• False

Answer explanation

Scarcity, Scarcity, Scarcity

Two basic types of economic systems are a market economy and a demand economy.

• True

• False

Answer explanation

Market, Mixed, and Command

A shortage of resources is called

• reduction

• threat

• scarcity

• limitation

Scarcity occurs when

• demand exceeds supply.

• distribution breaks down.

• conservation is at an all-time high.

• consumers’ needs exceed wants.

Answer explanation

It's all about supply and demand.

All of the following are factors of production EXCEPT

• educational resources

• natural resources

• labor resources

• capital resources

Answer explanation

Natural, labor, capital, and entrepreneurial

Some natural resources, such as wheat and cattle, are

• imported

• irreplaceable

• renewable

• artificially produced

Answer explanation

Option 4 makes me think about lab grown meat. Don't know how I feel about that.

Buildings, delivery trucks, and equipment are all examples of

• permanent assets

• capital resources

• short-term investments

• capital

Answer explanation

Capital resources are bought with capital (money)