Match the correct word or phrase in the correct

spot in the graphic organizer.

Groups:

(a) Goods

,

(b) Services

• Shoes

• Video games

• Trumpet lessons

• Babysitting

Which idea BEST completes the Venn diagram? What goes in BOTH (the middle)?

• offer services

• produce goods

• consume goods and services

• produce and consume goods and services

A woman who owns a business in which the government sets the prices operates in a __________.

• market economy

• command economy

• free enterprise system

• private property system

What is another reason money is used instead of bartering in modern economies?

• It is uniform.

• It can be loaned by a bank.

• It is important to our history.

• Its value changed depending on inflation.

If the supply of a product is low and the demand for that product is high, then the price of the product will ​ ​ (a)   .

• rise
• fall
• stay the same

The business may respond by increasing the supply, but if the supply becomes greater than the demand, the price of the product will​ (a)   .

• fall
• rise
• stay the same

Which effect best completes the graphic organizer?

• the business raises the price of the product

• the business creates an entirely new product

• the business decreases the supply of the product

• the business keeps the price of the product steady

Which of the following describes a result, or effect, of scarcity?

• Consumers pay less for a product.

• Consumers see their incomes go down.

• Consumers are faced with fewer opportunity costs.

• Consumers are less likely to have their needs and wants met.

Read the passage. Then answer the question.

The Alvarez family was thinking of making a major purchase. They had not taken a vacation in a long time and wanted to go to Hawaii. However, they also needed to buy a new car. Their current car was falling apart and Ms. Alvarez needed to drive to work each day. They discussed it together and in the end, they bought the car.

Which statement best describes the economic choice the Alvarez family made?

• The Alvarez family took a risk in order to save money.

• The Alvarez family made a personal economic choice based on scarcity.

• The Alvarez family had to consider the opportunity cost of the trip to Hawaii.

• The Alvarez family had little incentive to buy the car, but they did so anyway.

A good that is shipped from the United States to another country and then sold there is called an ________