Economics- Unit 1 1.0

What does the term "scarcity" refer to in economics?

• The amount of money available in an economy

• The limited availability of resources to meet unlimited wants

• The abundance of goods and services in a society

• The process of distributing wealth equally across a society

Which of the following is considered a "resource" in economics?

• Time

• Money

• Labor

• All of the above

Opportunity cost refers to:

• The total amount of money you spend on a good or service

• The potential gain lost when choosing one alternative over another

• The cost of producing an additional unit of a good

• The benefits of trade between two countries

What is the definition of "marginal cost"?

• The total cost of producing all units of a good

• The cost of producing one more unit of a good or service

• The opportunity cost of a decision

• The cost of labor in the production process

In a capitalist economy, who owns the resources and businesses?

• The government

• Private individuals and businesses

• A central authority

• Community organizations

Which of the following is NOT one of the four factors of production?

• Land

• Labor

• Money

• Capital

"Trade-offs" in economics refer to:

• The alternatives you must give up when making a choice

• The way that wealth is distributed in society

• The savings that a company makes in production

• The decisions made by consumers when choosing products

What is a "cost-benefit analysis"?

• A method to calculate the total cost of production

• A comparison of the costs and benefits of a decision to determine if it's worth pursuing

• A process used to calculate profits in a business

• The evaluation of government spending on public services

Economics is the study of:

• How people make choices when faced with limited resources

• How businesses set prices for their goods and services

• How governments control the economy

• The laws of supply and demand

The difference between "needs" and "wants" is that needs are:

• Limited in number

• Needs are essential for survival, while wants are not

• Based on personal desires

• Determined by the amount of income a person has