Understanding Economics

What is the definition of scarcity?

• The unlimited availability of resources.

• The limited availability of resources, forcing people to make choices.

• The abundance of money and time.

• The ability to have everything we want.

Which of the following is an example of a "need"?

• Designer clothes

• Concert tickets

• Basic clothing

• Streaming subscriptions

What happens to prices when demand is high and supply is low?

• Prices go down.

• Prices remain the same.

• Prices go up.

• Prices fluctuate randomly.

Which of the following is a "want"?

• Food

• Shelter

• Video games

• Medicine/healthcare

What is the cost in the decision-making process?

• The benefit you gain from a decision.

• The reward you receive for making a choice.

• What you give up when you make a decision.

• The total amount of money spent.

If a store offers a discount for buying two items instead of one, what type of incentive is this?

• Negative Incentive

• Positive Incentive

• Neutral Incentive

• No Incentive

What is the benefit in the decision-making process?

• The amount of money you save.

• The consequence of a poor decision.

• What you gain from the decision.

• The time you spend making a decision.

Which of the following is an example of a negative incentive?

• A store offers a free gift with purchase.

• You receive a bonus for good performance.

• You have to pay a late fee for returning a library book late.

• A company offers a discount for early payment.

What is the definition of supply?

• How much people want a product or service.

• The amount of money available to spend.

• How much of a product or service is available.

• The total demand for a product.

If you choose to buy a $10 lunch instead of saving that money, what is the cost?

• The $10 you won't have later.

• The enjoyment of the meal.

• The time spent eating.

• The nutritional value of the meal.