Principle of Economics

What is the fundamental problem of economics? 

• How to keep consumers out of debt?
• How to fulfill our unlimited wants and needs with limited resources?
• How to figure out the way to make the most money?
• How do we ensure all people get a college education?

Which of the following is NOT one of the three basic questions of economics when looking at economic systems? 

• What goods should be produced ?
• What is the price of the goods? 
• How should the goods be produced? 
• Who gets to consume the goods? 

Opportunity Cost is best defined as

• The best rejected alternative you give up when making a decision 
• The price you pay to purchase something 
• The benefit you gain by making a decision 
• The amount of debt you take on by making a decision 

Which of the following would be an example of human capital? 

• The amount of workers who work in a Nike factory
• The skills of the shoe designers at Nike 
• Philip Knight, the CEO of Nike 
• The land that the Nike headquarters is located on in Beaverton Oregon

Soil, minerals, air, water, and coal are all examples of

• Fossil fules
• Conservation
• recycling
• natural resources

A person that takes a risk by starting a new business.

• human capital
• capital goods
• entreprenuer
• tariff

Johnny has $50 and wants to buy a pair of Nike Shoes that cost $95.  He has to settle for a pair of Sketchers for $45.  In economic terms Johnny is facing the problem of: 

• Shortage
• Scarcity 
• Unemployment 
• Marginal costs

Antonio has an Economic test tomorrow and knows that if he stays up and studies until 11 p.m. he has a good chance of making an A on the test.  However he is really tired and knows that if he goes to bed at 10:00 p.m. he can easily make a B on the exam.  What is Antonio's opportunity cost if he goes to bed at 11:00 p.m.

• An A on the exam 
• making a B on the exam 
• Losing one hour of sleep
• gaining one hour of sleep

 The difference between a good and a service is that:

• Goods are available in unlimited quantaties and services are not 
• Goods are tangible and services are not 
• Services are available in unlimited quantaties and goods are not 
• goods help satisfy unlimited wants and services do not

What is the major difference between scarcity and a shortage? 

• They are really the same
• Shortages always exist and scarcity is temporary 
• Shortages are temporary and scarcity always exist. 
• Scarcity is limited and shortages are unlimited