WorksheetsEconomics Unit 1
Total questions: 33
Worksheet time: 17mins
Name
Class
Date
1.
Which of the following would result in a change in the production possibilities frontier in the mythical country Alpha?
a)
an influx of immigrants from other countries
b)
the discovery of an abundant natural resource
c)
a long drought
d)
all of the above
2.
Scarcity is a basic economic problem because:
a)
governments limit production
b)
resources are limited
c)
people have trouble making choices
d)
opportunity costs limit demand
3.
Which of the statements best describes the communist ideal?
a)
society in which the working class is motivated by incentives to produce goods
b)
classless society in which workers are motivated by financial incentives
c)
classless society in which everyone works for the common good
d)
society in which a small ruling class administers resources for the common good
4.
_______ protect consumers against harm from products on the market
a)
Government regulations
b)
Franchises
c)
Private property rights
d)
Profit Motives
5.
Inflation causes people to _______ .
a)
work the same hours for the same pay
b)
spend less for the same amount of goods and services
c)
work more to pay for basic necessities
d)
take more time off
6.
Which of the following helps determine something’s value?
a)
utility
b)
scarcity
c)
beauty
d)
both utility & scarcity
7.
Which of the following statements best describes the purpose of the production possibilities curve?
a)
It shows which products are most profitable.
b)
It predicts the future production of a nation.
c)
It identifies trends in production.
d)
It identifies all possible combinations of goods and services an economy can produce.
8.
The efficient use of scarce resources leads to an increase in:
a)
Scarcity
b)
Capital
c)
Investment
d)
Productivity
9.
When deciding how to use resources, you need to evaluate the costs and benefits of each choice to decide which meets your criteria. These are called:
a)
Resource Frontiers
b)
Trade-offs
c)
Priorities
d)
Opportunities
10.
Which of the following is a disadvantage of a market economy?
a)
It does not allocate resources as efficiently as other types of economies.
b)
It restricts personal freedom.
c)
It sustains a high degree of uncertainty
d)
It discourages creativity & new ideas for doing things
11.
The four factors of production are land, labor, capital, and _______ .
a)
Franchises
b)
Inflation
c)
Entrepreneurs
d)
The government
12.
The dollar value of all final goods, services, and structures produced in a country in a year is known as _______ .
a)
Gross National Product
b)
Profit Motive
c)
Franchise
d)
Gross Domestic Product
13.
The study of economics involves:
a)
explaining how people deal with scarcity.
b)
studying how things are made, bought, sold, and used.
c)
explaining how incomes are earned and how jobs are created.
d)
all of the above.
14.
Economic systems that are characterized by government control of the economic decision making process are considered to be:
a)
Communist
b)
Choice based
c)
Free market
d)
Efficient
15.
Societies are faced with which three basic questions about production of goods?
a)
What, where, when
b)
What, how, for whom
c)
What, how, why
d)
When, where, for whom
16.
Opportunity cost refers to:
a)
Cost of labor when production is expanded or changed
b)
Dollar amount attached to a good or service
c)
Value of the next best alternative
d)
Cost of not expanding production
17.
Which of these economic systems have the least in common?
a)
Command economy & capitalism
b)
Free-enterprise economy & market economy
c)
Market economy & capitalism
d)
Command economy & socialism
18.
The three synonymous terms to describe the U.S. economic system are free enterprise, capitalism, and _______.
a)
Free market
b)
Limited role of government
c)
Economic freedom
d)
Competition
19.
What kind of economy offers uniformity in wages regardless of individual productivity?
a)
Traditional economies
b)
All economies
c)
Market & free-enterprise economies
d)
Command & socialist economies
20.
Which of the factors of production involves taking risks and combining resources to produce a good or service?
a)
Capital
b)
Land
c)
Entrepreneurs
d)
Labor
21.
Paying rent instead of purchasing tickets to a concert is an example of:
a)
Circular flow model
b)
Scarcity
c)
Property rights
d)
Opportunity costs
22.
Which of these statements describes a disadvantage of a traditional economy?
a)
New ways of doing things are discouraged
b)
New ways of doing things are encouraged
c)
Difficult economic decisions are made by the state
d)
Everyone knows his or her role
23.
One of the characteristics of a capitalist free enterprise economy is _______ .
a)
Consumerism
b)
Voluntary exchange
c)
Minimum wage
d)
Central planning
24.
Which of the following descriptions best explains the meaning of opportunity cost?
a)
Cost of business failure
b)
Initial cost of starting a new business
c)
Risk associated with producing a new item
d)
The cost of choosing one alternative over another
25.
A can of soup is an example of a:
a)
Nondurable good
b)
Durable good
c)
Capital good
d)
Service
26.
A nation’s wealth is made up of:
a)
All goods and services
b)
Tangible items
c)
Intangible items
d)
All tangible & intangible items
27.
In the mythical country Alpha, an entrepreneur has introduced a new technology that makes manufacturing twice as efficient as before. How is this likely to affect the production possibilities frontier?
a)
Make the frontier smaller
b)
Change the shape of the frontier
c)
Not change the frontier
d)
Expand the frontier
28.
A car is an example of a:
a)
Durable good
b)
Service
c)
Capital good
d)
Nondurable good
29.
Paradox of value refers to the:
a)
high value of an essential item and the low value of a nonessential item.
b)
high value of a nonessential item and the low value of an essential item.
c)
contradiction of what consumers want and what they need.
d)
contradiction between gross domestic product and market value.
30.
Consumers in a free enterprise economy ultimately determine _______ to produce.
a)
where
b)
what
c)
how
d)
when
31.
Which of these is an accurate statement about mixed economies today?
a)
There are more mixed economies in the world than any other kind.
b)
Very few economies today can be accurately described as “mixed.”
c)
Mixed economies exist mostly in nations with communist governments.
d)
Most nations that once had a mixed economy have evolved into command economies.
32.
Which of the following is a feature of a command economy that distinguishes it from a socialist economy?
a)
Decisions are based on custom & habit
b)
Some degree of private ownership & activity is allowed
c)
All production is managed by the government
d)
All economic decisions are made by the government
33.
The economic system of the United States is considered a _______ .
a)
free market capitalist economy
b)
command economy
c)
socialist economy
d)
traditional economy
100 %
