Unit 1 Economics

A commodity can be defined as...

• Something that producers are unable to sell to consumers

• A resource that is available in unlimited quantities

• An exchange between a producer and a consumer

• Something of value that can be bought, sold, or traded

When demand decreases the result can be that...

• The supply is likely to increase

• The demand is likely to be inelastic

• The price is likely to increase

• The price is likely to decrease

Consumer belief in a product results in...

• The demand becomes less elastic

• The demand becomes more elastic

• The supply decreases

• The price decreases

In capitalism, what does competition do for consumers?

• It limits the number of choices consumers have

• It keeps prices fair for consumers

• It prevents consumers from being entrepreneurs

• It lets consumers create monopolies

A strong economy can be identified by

• A shrinking economy

• An increase in unemployment

• An increase in GDP

• A decrease in spending power

A market economy is regulated by the interactions of two things...

• Producers and consumers

• Product-based and service-based businesses

• Public and private sectors

• Goods and services

Impact on demand by increasing competition results in

• Make the demand less elastic

• Decrease the demand

• Make the demand more elastic

• Increase the demand

Capital is created via production how?

• By adding land to entrepreneurship

• By adding human labor to land

• By removing land from services

• By using labor to create services

Scarcity forces people to do what?

• Consume products

• Produce commodities

• Make choices

• Increase inflation

In a planned economy, prices of commodities are controlled by

• The government

• Supply and demand

• Private enterprises

• Producers and consumers