ECO Final Test Review

Scarcity is a basic economic problem because —

• resources are limited

• governments limit production

• opportunity costs limit demand

• people have trouble making choices

The basic idea of choice presents which of the problems in economics?

• People get to decide what they want.

• Businesses can sell what they want.

• Decisions produce costs.

• Choice is a way of life.

When can Point F on the model production-possibilities curve be attained?

• Using all resources available today

• Limiting use of available resources

• Introducing new technologies

• Requiring workers to concentrate on their work

What is required for an economy producing on the curve at Point B to produce more clothing?

• Get additional resources

• Acquire new technology

• Produce less food

• Hire more workers

High levels of unemployment combined with high levels of inflation could indicate that the business cycle has entered into a period of —

• recession

• stagflation

• expansion

• investment

Which of the following is described by the characteristics listed in the box?

• Monopoly

• Oligopoly

• Pure competition

• Monopolistic competition

Which of the following accurately completes the graphic?

• Types of money

• Federal Reserve notes

• Characteristics of money

• Functions of money

Money that has value simply because the government says it does is called —

• credit

• currency

• fiat money

• representative money

In order to require banks to hold more money as opposed to lending it, the Federal Reserve can —

• decrease the discount rate

• decrease the federal funds rate

• increase the reserve requirement

• suspend the federal funds rate target

The Occupational Safety and Health Administration (OSHA) is an example of a government agency that —

• regulates businesses

• collects administrative fees

• protects consumer interests

• advocates for benefits for labor