Economics Unit 1-6 final

Which of the following best defines scarcity in economics?

• Unlimited resources and limited wants

• Limited resources and unlimited wants

• Unlimited resources and unlimited wants

• Limited resources and limited wants

What is the primary function of prices in a market economy?

• To set government policy

• To allocate resources

• To increase unemployment

• To reduce inflation

Which of the following is NOT a type of market structure?

• Monopoly

• Oligopoly

• Perfect competition

• Fiscal policy

Gross Domestic Product (GDP) measures:

• The total value of all goods and services produced within a country

• The total value of all goods and services produced by a country's citizens abroad

• The total amount of money in circulation

• The total number of workers in a country

Which of the following is an example of a government subsidy?

• A tax on imported goods

• A payment to farmers to support crop prices

• A limit on the number of cars imported

• A ban on trading with a country

What does a tariff do?

• Increases the price of imported goods

• Decreases the price of exported goods

• Eliminates all trade barriers

• Subsidizes domestic producers

Which of the following best describes inflation?

• A general decrease in prices

• A general increase in prices

• A decrease in the money supply

• An increase in unemployment

A quota is:

• A tax on imports

• A limit on the quantity of a good that can be imported

• A government payment to producers

• A ban on trade with a country

Which of the following is a function of the government in a mixed economy?

• Setting prices for all goods

• Providing public goods and services

• Eliminating all private property

• Controlling all means of production

If the exchange rate for the US dollar increases relative to the euro, what happens to US exports to Europe?

• They become more expensive for Europeans

• They become cheaper for Europeans

• They remain unchanged

• They are banned