Module 5 Economics Review

Why is a profit motive important in many economies?

• People would not use coupons without it.

• Businesses could not advertise without it.

• Businesses could not set prices without it.

• People would not start businesses without it.

Which describes labor?

• raw materials needed to produce goods

• human time, effort, skills, and talent needed to produce goods

• items such as tools, machines, factories, and office equipment needed for a business to function

How would you describe financial capital?

• money that a business uses to buy the items needed for the business to function

• raw materials needed to produce goods

• items such as tools, machines, factories, and office equipment needed for a business to function

Which term means the raw materials needed to produce goods?

• capital

• financial capital

• labor

• natural resources

Which scenario illustrates the concept of economic interdependence?

• An entrepreneur decides to open a bakery and produce bread for the neighborhood.

• Good rainfall allows a farmer to produce more strawberries so he expands his business.

• Japan lacks iron to make steel, so Japans enters into a trading relationship with Australia to get iron ore.

• South Africa is rich in diamonds and gold so they create a mining industry that produces wealth.

Which country has a communist economy?

• Taiwan

• China

• Sweden

Which country has a socialist economy?

• Taiwan

• South Korea

• Sweden

Why must governments ensure that corporate taxes are not too high?

• Public services will suffer.

• Businesses will not make a profit.

• The government cannot invest in education.

• The government cannot invest in national defense.

A grocer selling cheese in a market is an example of what type of industry?

• tertiary

• quarternary

• primary

• secondary

Inspectors examining the quality of the cheese is an example of what type of industry?

• quarternary

• primary

• secondary