1.1 Business Activity Quiz 1

Which of the following is NOT a factor of production?

• Land

• Labor

• Capital

• Competition

The basic requirements for survival are called:

• Wants

• Needs

• Goods

• Services

The concept that resources are limited compared to unlimited wants is known as:

• Abundance

• Scarcity

• Supply and demand

• Opportunity cost

What is the cost of the next best alternative when making a choice?

• Marginal cost

• Opportunity cost

• Fixed cost

• Variable cost

Which factor of production refers to the skills and knowledge of workers?

• Land

• Labor

• Capital

• Entrepreneurship

A desire for something that is not essential for survival is called a:

• Need

• Want

• Luxury

• Commodity

The process of creating goods and services is called:

• Production

• Consumption

• Distribution

• Exchange

Which factor of production includes natural resources used in production?

• Land

• Labor

• Capital

• Entrepreneurship

The idea that choices involve trade-offs is related to the concept of:

• Scarcity

• Opportunity cost

• Supply and demand

• Diminishing returns

Which of the following is an example of capital as a factor of production?

• A factory building

• A farmer's labor

• A natural gas deposit

• An entrepreneur's idea