EPF Unit 1 Review

Which of these is an example of the Law of Diminishing Marginal Utility?

• The more I want a new bike, the more I am willing to work for it.

• Eating a 3rd marshmallow in a row is less satisfying than eating the 1st marshmallow.

• The lower the price on a pair of socks the more I will want to buy them.

• Your 6th plate of food at the all-you-can-eat buffet is more satisfying than the 1st plate.

What is the difference between a personal and productive resource?

• Personal resources are tangible, productive resources are intangible.

• Personal resources are owned by individuals, productive resources are used to produce goods.

• Personal resources are used in production, productive resources are consumed.

• Personal resources are renewable, productive resources are non-renewable.

As the opportunity cost of college increases compared to the benefits, a person is ...

• more likely to attend college.

• Unaffected by the change.

• less likely to attend college.

• more likely to drop out of college.

Why is scarcity always and everywhere?

• Because resources are unlimited.

• Because human wants are limited.

• Because resources are limited and wants are unlimited.

• Because resources are renewable.

Opportunity cost is most similar to -

• a trade-off.

• the monetary value of the item.

• your first choice.

• your limited wants.

In a market economy, prices are set by the interaction of which two groups?

• Government and producers

• Consumers and producers

• Banks and investors

• Suppliers and retailers

What is highly valued and encouraged in a market system?

• Monopoly

• Competition

• Regulation

• Subsidy

What is a patent used for?

• To increase production

• To prevent theft of a new design

• To lower costs

• To improve quality

Who wrote the book "Wealth of Nations"?

• Karl Marx

• John Maynard Keynes

• Adam Smith

• Milton Friedman

In a command economy, how is the decision of what to produce typically made?

• By consumer demand

• By historical precedent

• By government planning

• By market trends