Economics FINAL Review

What are the four factors of production?

• Land, Labor, Capital,

• Land, Labor, Money,

• Resources, Capital, Management

• Land, Machines, Entrepreneurship

Which of the following is a goal of the economy focused on fair distribution of wealth?

• Efficiency

• Equity

• Growth

• Stability

In a capitalist economy, who owns the businesses?

• The government

• Private individuals

• Non-profit organizations

• International corporations

What is scarcity?

• Unlimited resources

• Limited resources forcing choices

• Excessive production

• Abundance of goods

What is opportunity cost?

• The money spent on a purchase

• The time taken to make a decision

• What you give up when choosing one option over another

• The profit made from a business

What are trade-offs in decision-making?

• The benefits we gain from a decision

• The alternatives we give up when making a decision

• The costs associated with a decision

• The outcomes of a decision

In a market economy, who makes the economic decisions?

• The government

• Individuals based on supply and demand

• International organizations

• Local authorities

What characterizes a free market economy?

• Prices are set by the government

• Prices are determined by supply and demand with little government intervention

• Prices are fixed by international agreements

• Prices are determined by local councils

What does the Circular Flow Model illustrate?

• How government policies affect the economy

• How money and goods move through the economy between households and businesses

• How international trade affects local markets

• How inflation impacts purchasing power

In command economies, who controls all aspects of the economy?

• Private businesses

• International corporations

• The government

• Local communities