Study Guide for Economics and Personal Finance

A local yard sale would be considered which economic system?

• Mixed Economies

• Market Economies

• traditional Economies

• command Economies

▪Government serves to protect both producers and consumers from unfair policies and practices

• Mixed Economies

• market Economies

• traditional Economies

• command Economies

According to Adam Smith, everyone makes decisions that are best for themselves

• MACRO Economics

• Opportunity Costs

• Invisible Tradeoff Theory

• Invisible Hand Theory

Economy is...

• a complex system of: production, consumption and exchange activities

• a study of how people allocate scarce resources

• a condition where not enough resources are available to meet all the needs and desires

• the basic problem in economy

Resources are...

• The inputs that society uses to produce output/goods

• The basic problem in economics

• The goods and services that people produce

• The output that society uses to produce inputs

Scarcity is

• a condition where not enough output are available to meet all the services

• a condition where not enough desires are available to meet all the needs

• a condition where not enough resources are available to meet all the needs and desires

• a condition where not enough resources are available to meet all the output

The focus of economics is...

• How society allocates resources and goods

• How society allocates services and goods

• How society allocates scarce resource and free resource

• How society allocates needs and goods

Which of the following is a primary function of money in an economy?

• Medium of exchange

• Store of value

• Unit of account

• All of the above

What is the opportunity cost of choosing to spend time studying instead of going out with friends?

• The money spent on books

• The enjoyment of socializing

• The grades achieved

• The time spent studying

Which economic concept explains the benefit of specialization and trade between countries?

• Comparative advantage

• Absolute advantage

• Trade deficit

• Protectionism