Economics Midterm

Why do all societies have to make decisions about how resources will be used?

• People are greedy

• There are not enough resources for those who want them

• Resources are too expensive for most people

• Because there is a huge gap between the rich and poor

Why do we have to make production choices about available resources?

• Too many resources for the demand

• Limited wants

• Unlimited resources

• Scarcity

The condition of scarcity can be described as one that

• afflicts only poor people and nations

• exists when our unlimited needs/wants exceed our limited resources

• exists when our limited resources exceed our unlimited needs/wants

• only applies to luxury items

Why do entrepreneurs take risks?

• to set their own work hours

• to earn a profit for themselves

• to provide G/S to their customers

• to provide salaries and benefits to their employees

__________ is the fundamental, universal, and perpetual economic problem that no one is immune to.

• price floors/price ceilings

• Scarcity

• Shortage

• the study of microeconomics

Opportunity cost (OC) can be described as

• your number 1 tradeoff when making a choice

• the number 2 alternative in your list of choices

• is the next best choice and one you didn't choose

• all of these answers are examples of opportunity cost (OC)

What determines the prices of goods and services?

• Supply

• Demand

• Supply and demand

• Goods

What exists when quantity supplied is greater than quantity demanded?

• Surplus

• Shortage

• Overflow

• Mass outrage

What happens to price when the market has a surplus

• price drops

• price stays the same

• price increases

• price triples

Defined as: the goods and services produced in one country and purchased by residents of another country

• import

• export

• embargo

• economy