What is Economics

Rationing exists because of

• a surplus of products.
• price.
• scarcity.
• incentives.

The opportunity cost of something is

• the dollar value of the item.
• less than the dollar value of the item.
• more costly to the poor.
• what you give up to get the item.

The marginal cost of something is

• never greater than the marginal benefit.
• the opportunity cost minus the actual cost.
• the cost to produce one additional unit.
• an intangible resource.

A production possibilities frontier shows

• all possible combinations of two goods an economy can produce.
• all the possible production of one particular good.
• all possible combinations of all the goods that an economy can produce.
• all the possible combinations of four goods an economy can produce.

If you are making decisions at the margin, you are

• selecting either all or nothing at all.
• confused about what to do.
• comparing the extra benefit to the extra cost.
• All of the above.

If your parents offer you cash for every A on your report card, that is an example of

• an incentive.
• a bribe.
• marginal cost
• a trade-off.

Animals are classified as which of the following factors of production?

• land
• labor
• capital
• entrepreneurship

Which of the following groups is faced with scarcity?

• individuals
• businesses
• society
• All of the above

Economics would not exist if it were not for

• mathematics.
• scarcity.
• incentives.
• money.

Opportunity cost is most similar to

• a trade-off.
• the dollar value given up.
• your choice.
• all the alternatives forfeited.