Economics Quiz

What is a characteristic of a free market?

• Centralized economic decisions

• Government control over buying and selling

• Right to buy and sell goods freely

• Equal distribution of resources

In a market economy, who makes economic decisions?

• Government officials

• Business owners

• Individuals looking out for their best interests

• Labor unions

What does free enterprise allow business owners to do?

• Operate without any restrictions

• Operate only with government approval

• Operate solely for government interests

• Operate based on community decisions

What are natural resources?

• Items produced by humans

• Goods created with government intervention

• Items provided by nature without human intervention

• Items exclusively owned by corporations

What is profit in business?

• Total revenue

• Total expenses

• Money left over after expenses

• Government subsidies

When there is a limited number of resources, it is called:

• Abundance

• Scarcity

• Surplus

• Overproduction

According to the law of supply, businesses produce more products when:

• There is a surplus of products

• Prices are low

• Demand is high

• Prices are high

According to the law of demand, buyers demand a larger quantity of a good when:

• Prices are low

• Prices are high

• There is a surplus of goods

• Production is low

In capitalism, who owns the productive resources?

• Government

• Private citizens

• Nonprofit organizations

• Corporations

What is a monopoly?

• A market with many sellers

• A market with no buyers

• When only one company sells a product

• A type of partnership