Circular Flow of Economic Activity Quiz

Part of the circular flow of economic activity where firms decide what to produce, for whom to produce, and how much to produce.

• Product Market

• Factor Market

• Business Sector

• Consumer Sector

Land, labor, capital, and resources.

• Public Good

• Factors of Production

• Transfer Payment

• Trade-Off

An expense that cannot be recovered.

• Sunk Cost

• Trade-Off

• Surplus

• Shortage

The basic economic problem of having unlimited wants/needs and limited resources is known as:

• Scarcity

• Abundance

• Surplus

• Inflation

When supply is greater than demand, it is called:

• Shortage

• Equilibrium

• Surplus

• Deficit

Goods meant to be sold to consumers for personal use are called:

• Capital Goods

• Consumer Goods

• Industrial Goods

• Durable Goods

A household sold its labor to the t-shirt factory. What is this an example of?

• Supply

• Demand

• Production

• Consumption

Based on the chart, what is the price of shoes when the supply is 20,000?

• $20

• $30

• $60

• $70