Economics Chapter 1 Test

Which of the factors of production involves taking risks and combining resources to produce a good or service?

• Labor

• Entrepreneurship

• Land

• Capital

Consumers waiting in long lines for a new product is an example of:

• Scarcity

• Consumer Responsibilities

• Consumer Rights

• Consumerism

When deciding how to use resources, you need to evaluate the costs and benefits of each choice to decide which meets your criteria. These are called:

• Resource Frontiers

• Priorities

• Opportunities

• Trade-offs

Consumers are expected to read the full information about a product before making a purchase. This is an example of a consumer's:

• Habits

• Rights

• Responsibilities

• Opportunities

Societies are faced with which 3 basic questions about production of goods?

• What? Where? When?

• When? Where? For Whom?

• What? How? For Whom?

• What? How? Why?

A nation's wealth is made up of:

• All goods and services

• All tangible items

• All tangible and intangible items

• All intangible items

Which of the following helps determine something's value?

• Scarcity

• Beauty

• Utility

• Price

Paradox of value refers to the:

• Contradiction of what consumers want and what they need

• Contradiction between gross domestic product and market value

• High value of an essential item and the low value of a nonessential item

• High value of a nonessential item and the low value of an essential item

Which of the following would result in a change in the production possibilities frontier in the mythical country, Alpha?

• A long drought

• The discovery of an abundant natural resource

• An influx of immigrants from other countries

• All of the above

Division of labor is practiced because:

• It prevents specialization

• It increases efficiency by ensuring that workers become good at specific tasks.

• It increases efficiency by ensuring that all workers become good at every task.

• Companies do not want workers to talk to one another.