1st Semester Exam (Part 1) 2025

In economics, why must consumers, businesses, and governments make choices?

• They have to make rational decisions.

• There is inflation

• There is a price ceiling.

• There is resource scarcity.

Imagine that you decide to spend all of your free time surfing the web for an entire week. During this week-long period, opportunity costs for this decision would ________.

• Go up and down

•  

  Steadily increase

• Remain the same

• Quickly decrease

Which of the following statements best summarizes the reason for economics?

• People spend more than they make.

• The number of people who do not have jobs is rising.

• While wants are unlimited, resources are scarce.

• Opportunity costs can never be determined accurately.

When one alternative is chosen over another, the option not chosen is considered a(n)_________________ ?

• Opportunity cost

• Scarcity

• Opportunity lost

• Marginal cost

A mixed economy combines which economic systems?

• Traditional and communism

• Traditional and market

• Command and traditional

• Market and command

When a person brings an item to a pawnshop to obtain cash, the transaction is considered

• a custodial payment

• a collateralized loan

• an unsecured loan

• a sales agreement

What is another name for take home pay?

• Salary

• Net pay

• Wages

• Gross pay

What is the amount of money that you actually take home from your paycheck?

• Taxes

• Gross pay

• Deduction

• Net pay

How is personal net worth calculated?

• Subtracting total liabilities from total assets

• Adding total assets and total liabilities

• Subtracting total assets from total liabilities

• Totaling the purchase prices of all items a person owns

What is the purpose of goal setting in the financial planning process?

• To provide direction for planning and action

• To facilitate decision making

• To clarify goal ranges

• To differentiate between needs and wants