Introduction to Economics Review

What is the law of supply and demand?

• Supply and demand have no impact on the price of goods and services

• The price of a good or service is determined by the quality of the product

• The price of a good or service is determined by the supply and demand for it in the market.

• The law of supply and demand is based on government regulations

What is opportunity cost?

• The cost of the chosen alternative

• The value of the next best alternative that is given up when a decision is made.

• The cost of the most expensive option

• The cost of the least desirable option

What are the types of economies?

• Capitalist, Socialist, Communist

• Agricultural, Industrial, Service

• Developed, Developing, Underdeveloped

• Traditional, Command, Market

Define macroeconomics.

• Study of individual consumer behavior

• Branch of economics that deals with the performance, structure, behavior, and decision-making of an economy as a whole

• Focus on the financial performance of a single company

• Analysis of small-scale market transactions

What happens to price when there is a high demand and low supply?

• Price increases

• Price remains the same

• Price decreases

• Price fluctuates

How is opportunity cost calculated?

• By flipping a coin

• By counting the number of options available

• By determining the value of the next best alternative that is forgone

• By choosing the most expensive alternative

What are the characteristics of a traditional economy?

• Reliance on industrialization, monetary system, and advanced technology

• Reliance on fishing, gift economy, and modern infrastructure

• Reliance on manufacturing, credit system, and high-tech innovations

• Reliance on agriculture, barter system, and limited technology

Give an example of a command economy.

• United States

• Germany

• Japan

• North Korea

What is the difference between a planned economy and a market economy?

• Planned economy is controlled by the government, while market economy is driven by supply and demand with minimal government intervention.

• Planned economy is based on barter system, while market economy uses currency for trade.

• Planned economy has no government intervention, while market economy is heavily regulated by the government.

• Planned economy is controlled by large corporations, while market economy is controlled by small businesses.

What are the factors that influence microeconomic decisions?

• Color of the product, packaging design, and advertising slogans

• Weather conditions, time of day, and personal beliefs

• Price, demand, supply, cost of production, consumer preferences, and government policies

• Global economic trends, historical events, and social media influence