CE.11-13 Study Guide

What is the problem of scarcity faced by all individuals and organizations, including businesses and governments?

• We have unlimited wants, but our resources are limited.

• We have limited wants, but our resources are unlimited.

• We have unlimited resources and limited wants.

• We have limited goods and unlimited services.

Scarcity is the inability to satisfy all wants at the same time. All resources and goods are _______.

• limited

• unlimited

• free

• abundant

What are the types of resources needed in the means of production?

• Natural, human, capital, and entrepreneurship

• Physical, financial, technological, and labor

• Land, labor, capital, and management

• Natural, financial, technological, and labor

What is opportunity cost?

• The cost of producing goods

• The value of what is given up when a choice is made

• The price of a product

• The amount of money spent on resources

What determines what is produced in an economy?

• Resources available and consumer preferences

• Government only

• Producers only

• Technology only

The key factor in determining the type of economy a country has is the extent of _______ involvement.

• government

• business

• citizen

• military

Which of the following is a characteristic of a free market economy?

• Private ownership of property/resources

• Centralized government control

• No competition

• No individual choice

What are the three basic questions of economics?

• What will be produced? How will it be produced? For whom will it be produced?

• Who will produce? When will it be produced? Where will it be produced?

• How much will it cost? Who will buy it? Where will it be sold?

• What is the price? Who is the consumer? What is the resource?

Which of the following is a characteristic of a command economy?

• A) Central ownership of property/resources

• B) Free market decision making

• C) High consumer choice

• D) Private sector ownership

A centrally planned economy is a feature of which type of economic system?

• Mixed economy

• Command economy

• Free market economy

• Traditional economy