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Economics is the study of

• production technology

• consumption decisions

• how society decides what, how, and for whom to produce

• the best way to run society

What is opportunity cost?

• The next best option for investing your money

• The alternative uses for your time and money

• What else you could have spent your money on

• The next best available option foregone

The amount of resources in an economy:

• Are always fixed

• Can never decrease

• Always increase over time

• Are limited at any moment in time

Carl owns a computer company. On any given day, he can produce either 500 desktop computers or 300 laptops. What's his opportunity cost if he decides to produce 500 desktops?

• 300 laptop computers

• 500 desktops

• 800 laptop computers

• There's no opportunity cost because he can make more desktops than laptops.

Human wants are:

• Always fixed

• Limited

• Unlimited

• Likely to decrease over time

The physical effort of people to produce goods or services describes which factor of production?

• Land

• Labour

• Capital

• Enterprise

The opportunity cost of a good is

• the time lost in finding it

• the quantity of other goods sacrificed to get another unit of that good

• the expenditure on the good

• the loss of interest in using savings

A CFO can invest company profits in stocks with projected returns of 10%, or use the money to add a new assembly line, projected to yield 14% after payment of the debt. What is the opportunity cost of investing in stocks instead of the factory upgrade?

• 10%

• 14%

• 4%

• 24%

The sacrifice involved when you choose a particular course of action is called the:

• Alternative

• Opportunity cost

• Consumer cost

• Producer cost

What is the basic economic problem?

• Arguments over which goods and services to produce and why

• Unlimited needs but limited resources

• Unlimited wants but limited resources

• Limited wants but unlimited needs