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WorksheetsEconomics: Chapter 1 Review
Total questions: 28
Worksheet time: 16mins
Name
Class
Date
1.
Economics is about making choices.
a)
True
b)
False
2.
An example of a positive economic statement is "The U.S. unemployment rate is 5.8%."
a)
True
b)
False
3.
Markets are the means by which buyers & sellers carry out exchange.
a)
True
b)
False
4.
Goods & Services are bought and sold in resource markets.
a)
True
b)
False
5.
You should ignore sunk cost in making economic choices.
a)
True
b)
False
6.
Your opportunity cost depends on your alternatives.
a)
True
b)
False
7.
Productive resources are also called factors of production.
a)
True
b)
False
8.
Which of the following is a service?
a)
a restaurant meal
b)
a guitar lesson
c)
dry-cleaning fluid
d)
a concert t-shirt
9.
Scarcity arises because all societies have
a)
limited productive resources to satisfy unlimited wants
b)
unlimited productive resources to satisfy limited wants
c)
limited needs and unlimited wants
d)
unlimited needs and limited wants
10.
Inputs used to create goods & services that people want are called
a)
natural resources
b)
productive resources
c)
exhaustible resources
d)
renewable resources
11.
An individual who tries to earn a profit by developing a new product or finding a better way to produce an existing one is a(n)
a)
employee
b)
manager
c)
entrepreneur
d)
executive
12.
Economics is the study of how
a)
gov't allocates scare resources to satisfy people's unlimited wants.
b)
gov't supplies money to businesses to produce goods & services.
c)
people use their scarce resources to satisfy their unlimited wants.
d)
businesses supply unlimited goods & services with limited resources.
13.
An example of a renewable resource is
a)
oil
b)
coal
c)
copper
d)
timber
14.
An example of an exhaustible resource is
a)
timber
b)
corn
c)
oil
d)
cotton
15.
The assumption of rational self-interest means that
a)
people choose alternatives that best serve their interests.
b)
people make choices based on selfishness and greed.
c)
people make choices without concerns for the interests of others.
d)
different people will make the same choices, given the same information.
16.
A study that examines how price and output are determined in the market for breakfast cereal would involve
a)
socioeconomics
b)
microeconomics
c)
marginal economics
d)
macroeconomics
17.
The opportunity cost of a chosen item or activity is
a)
the money you must give up to buy it
b)
the value of all alternatives you must pass up
c)
The value of the best alternative you must pass up.
d)
the money you lost by not choosing the least expensive option.
18.
A cost that you have already paid and cannot recover is known as a
a)
normative cost
b)
positive cost
c)
negative cost
d)
sunk cost
19.
To decide whether to have dessert, you consider the extra time you would spend eating the dessert and the extra calories, both of which are part of the ___ of this decision.
a)
opportunity cost
b)
capital cost
c)
marginal cost
d)
sunk cost
20.
A study of total consumption in the U.S. economy would involve
a)
normative economics
b)
microeconomics
c)
consumer economics
d)
macroeconomics
21.
Rationality implies that each firm supplies the products expected to maximize the firm's
a)
satisfaction
b)
profit
c)
revenue
d)
size
22.
Rational decision makers will change the status quo as long as
a)
the expected marginal benefit equals the expected marginal cost
b)
the expected marginal benefit exceeds the expected marginal cost
c)
the expected marginal cost exceeds the opportunity cost
d)
the expected marginal cost exceeds the expected marginal benefit
23.
___ equals the revenue from sales minus the cost of production.
a)
profit
b)
labor
c)
capital goods
d)
marginality
24.
Economists use ___________ to make predictions about the real world.
a)
economic theories (models)
b)
capital goods
c)
marginal benefits
d)
profit
25.
___ is the physical & mental effort used to produce goods & services.
a)
Labor
b)
Revenue
c)
Behavior
d)
Marginal
26.
In the economy, goods & services flow from businesses to product markets, and _____ flows from product markets to businesses.
a)
Revenue
b)
Capital goods
c)
labor
d)
profit
27.
_______ include all human creations used to produce goods and services.
a)
capital goods
b)
labor
c)
marginal products
d)
revenue
28.
A basic ___ assumption that economists make is that people make choices based on self-interest.
a)
behavioral
b)
marginal
c)
human
d)
labor
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