Economics Worksheet - Factors of Production and Scarcity

Economists identify land, labor, capital, and entrepreneurship as the essential inputs required for the production of goods and services. Together, these inputs determine how resources are allocated in an economy. What are these inputs collectively called?

• Production possibilities frontier

• Factors of production

• Trade-offs in resource allocation

• Opportunity costs of decision-making

Why is scarcity a problem faced in all societies?

• Some goods cost more than others

• Scarcity is a permanent condition.

• Some things are needs and others are wants.

• Some people want to have more goods than others.

With regard to food and clothing in the production possibilities curve above, what does point C represent?

• a combination that cannot be achieved right now

• a combination that can be achieved if all resources are conserved properly

• a combination that can be achieved if all the country uses all of its resources

• none of the above

Which of the following examines the costs and expected benefits of a choice?

• choice-benefit analysis

• cost-profit analysis

• cost-benefit analysis

• choice-profit analysis

This is an economic system in which individuals and private businesses have the freedom to make their own choices about production, distribution, and consumption of goods and services with limited government interference. In this system, people have the right to own property, earn profits, compete in the marketplace, and decide how to use their resources. Competition encourages efficiency and innovation, while consumer demand helps guide what is produced. Although the government may set regulations to ensure fairness and protect public interests, the driving force is individual decision-making within an open market. The list above describes characteristics of which economic system?

• A Command

• B Traditional

• C Socialist

• D Free enterprise

In modern-day China, the CPC is central decision-making body that directs economic planning, sets production targets, and allocates resources. Instead of supply and demand driving the economy, the CPC uses centralized planning to determine what goods and services will be produced and how they will be distributed. While this system aims to promote equality and collective welfare, it often restricts individual economic freedom and limits competition in the marketplace.

• free enterprise

• traditional

• communist

• socialist

In a communist economy, workers are-

• rewarded for productivity by receiving extra money

• always employed by private businesses

• sometimes employed by private businesses

• always employed by the government or government controlled groups

In a capitalist economy, private parties are driven to invest in the economy because-

• they are seeking profits

• they want to reach the goals set by central planners

• they want to follow government policies

• they want the government to control the factors of production

Maria has $50 and two free hours on Saturday. She is deciding whether to buy a concert ticket and spend the evening at the show, or to use the money to go out to dinner with friends and then study for her upcoming exam. If Maria chooses to attend the concert, what is her opportunity cost?

• The money she spends on the concert ticket only

• The chance to have dinner with friends and extra study time

• The enjoyment she gets from listening to live music

• The cost of gas to drive to the concert

Refer to the graph titled 'Market schedule for slices of pizza.' What happens to the demand for pizza as the price per slice increases?

• F demand increases

• G demand stays the same

• H demand decreases

• J demand affects supply