Economic Concepts Quiz

Which is not one of the three key economic questions?

• Why do we produce goods and services?

• How should goods and services be produced?

• Who consumes the goods and services?

• What goods and services should be produced?

What is necessary to ensure increased standards of living?

• Security

• Stagnation

• Equity

• Innovation

Which economic system most values the goal of freedom?

• Command

• Traditional

• Mixed

• Free Market

A benefit of technology is that it

• Makes certain jobs obsolete.

• Increases a nation’s productivity.

• Slows or stops production.

• Decreases a nation’s GDP.

Each of these is a principle of free enterprise except

• Private Property.

• Legal Equality.

• Voluntary Exchange.

• Public Welfare.

Charlie went to the fair. At the end of the night, he had two ride tokens left. He could use them both to ride the Ferris Wheel one last time, or he could use one to visit the fun house and one to ride the roller coaster. Charlie decided to ride the Ferris Wheel. Which statement BEST describes Charlie’s choice?

• Charlie values variety over repetition.

• Charlie prefers the fun house to the Ferris Wheel.

• Charlie values the Ferris Wheel experience more than trying new rides.

• Charlie is indifferent to the rides.

Which describes human capital?

• Buildings and tools

• Skills and knowledge

• Land and labor

• Slowing or stopping production

In which type of economic system is consumer sovereignty most valued?

• Free Market

• Command

• Traditional

• Mixed

How does specialization relate to voluntary exchange?

• When we become overly specialized, exchange ceases to be voluntary.

• There is enough division of labor in one nation to make trading pointless.

• Specialization enables us to make decisions about what is best to produce and what is best to trade.

• Trading weakens us by making us dependent on other nations.

Decision Grids are valuable tools because they help us

• Weigh benefits against opportunity costs.

• Understand maximum production capabilities.

• Realize that trade-offs are unnecessary.

• Solve problems when only two options exist.