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Economics Review

Total questions: 78

Worksheet time: 2hrs 30mins

Name
Class
Date
1.

Choose all of the statements that are TRUE regarding scarcity.

(Select all answers that apply.)

a)

We have unlimited wants, but our resources are limited.

b)

The goods and services we want exceed our ability to produce them.

c)

Scarcity forces consumers, producers, and governments to make difficult choices.

d)

Scarcity is defined as the ability to satisfy all wants at the same time. All resources and goods are unlimited.

2.

Resources are factors of production that are used in the production of goods and services. Select all examples of resources.

a)

production

b)

capital

c)

supply

d)

natural

e)

human

3.

Which term below is a selection of an item or action from a set of possible alternatives?

a)

opportunity cost

b)

choice

c)

production

d)

consumption

4.

Which term below is what is given up when a choice is made (the second-best alternative)?

a)

opportunity cost

b)

choice

c)

production

d)

consumption

5.

Which term below is the using of goods and services?

a)

opportunity cost

b)

choice

c)

production

d)

consumption

6.

Which term below is the combining of human, natural, capital, and entrepreneurship resources to make goods or provide services?

a)

opportunity cost

b)

choice

c)

production

d)

consumption

7.

How do producers determine what will be produced?

a)

They pay attention to consumer preferences and available resources.

b)

They produce only what the government suggests they produce.

c)

They roll the dice and hope for the best.

8.

Consumer _____ and ____ determine what is purchased and consumed.

a)

supply and demand

b)

income and services

c)

preference and price

9.

What are the three basic questions of economics? (Select 3.)

a)

How will it be produced?

b)

When will it be produced?

c)

Why will it be produced?

d)

For whom will it be produced?

e)

What will be produced?

10.

Which of the following statements are TRUE regarding a traditional economy?

(Select 2.)

a)

Economic decisions are based on supply and demand.

b)

Economic decisions are based on custom and historical precedent.

c)

People often perform the same type of work as their parents and grandparents, regardless of ability or potential.

d)

People choose their careers based on skills and preferences.

11.

Which of the following are characteristics of a

free market economy?

(Select all answers that apply.)

a)

private ownership of property and resources

b)

profit motive and competition

c)

consumer sovereignty and individual choice

d)

lack of consumer choice

e)

minimal government involvement in the economy

12.

Which of the following are characteristics of a

command economy?

(Select all answers that apply.)

a)

profit motive

b)

consumer choice

c)

central ownership of property and resources

d)

centrally-planned economy with little consumer choice

e)

competition

13.

Which of the following are characteristics of a

mixed economy?

(Select all answers that apply.)

a)

In the private sector, individuals and businesses are the owners and decision makers.

b)

In the public sector, individuals and businesses are the owners and decision makers.

c)

In the public sector, the government is the owner and decision maker.

d)

Most economies today, including the U.S. economy, are mixed economies.

e)

In the private sector, the government is the owner and decision maker.

14.

In a mixed economy, which sector operates like a command economy?

a)

public

b)

private

c)

both public and private

15.

The key factor in determining the type of economy a country has is...

a)

the amount of resources owned by the country.

b)

the supply and demand of the consumers.

c)

the price of goods and services.

d)

the extent of government involvement in the economy.

16.

In a mixed economy, which sector operates like a free market economy?

a)

public

b)

private

c)

both public and private

17.

A consumer is like a king. What consumers want, businesses produce. What is the term for "consumer is king"?

a)

consumer poverty

b)

consumer sovereignty

c)

profit motive

d)

consumption

18.

Bob decides to attend college instead of entering the work force right out of high school. He is hoping to increase his future earning power, and in return, is giving up the immediate income and experience of starting work immediately. What is Bob's opportunity cost in this scenario?

a)

immediate income and experience

b)

future earning power

c)

four years of his life

19.

Which type of resource is the person who has the ideas for new businesses?

a)

natural

b)

human

c)

capital

d)

entrepreneurship

20.

Which type of resource is tools, equipment, and investment money?

a)

natural

b)

human

c)

capital

d)

entrepreneurship

21.

Identify what risks entrepreneurs may have to take to turn a profit

a)

Failure and loss of personal money

b)

Using private funds to start a new business

c)

Disappointing the government agency they work for

d)

Public ridicule

e)

Owing extra taxes for starting a new business

22.

Which person would most likely be considered an entrepreneur?

a)

Travis works as a mechanic at a car dealership

b)

Jose took a risk to make a profit from home storage units

c)

Emma sells cellular devices for a national company.

d)

Ming teaches math in a public high school

23.
Society will never be able to satisfy all wants and ____.
a)
desires
b)
needs
c)
hungers
d)
money problems
24.
If my government is selling me bread for $5 a loaf, and I have no choice but to buy that type of bread, I live in a _____ economy. 
a)
Traditional 
b)
Market 
c)
Command 
d)
Mixed
25.

There are four types of economic systems. Most economies are _____.

a)

Traditional

b)

Command

c)

Market

d)

Mixed

26.

"Households receive money (payments) for the labor." Which label on the circular flow best describes this?

a)

Expenditures

b)

revenue

c)

Income

d)

none of the above

27.
A business that has one owner would be an example of a -
a)
Sole Proprietorship
b)
Partnership
c)
Corporation
28.
An entrepreneur can choose to have which type of business organization?
a)
Sole Proprietorship
b)
Partnership
c)
Corporation
d)
All of the above
29.
A business where owners share profits and risks is called what?
a)
Partnership
b)
Proprietorship
c)
Entrepreneurship
30.
Which category of Circular Flow provides public goods and services?
a)
Businesses
b)
Households
c)
Government
31.

Most American households receive income from selling which resource?

a)

Land

b)

Labor

c)

Capital

d)

Entrepreneurship

32.
A person who buys goods and services
a)
consumer
b)
entrepreneur
c)
resource
d)
currency
33.
If the demand for a product exceeds the supply, what will happen to the price?
a)
The price goes up.
b)
The price stays the same.
c)
The price immediately goes up, then down.
d)
The price goes down.
34.
Chloe wanted to buy a new sweater, but she really needed a new pair of tennis shoes.  When her mom took her shopping at Kohls, she ended up buying the tennis shoes.  What was her opportunity cost?
a)
Kohls
b)
the sweater
c)
the tennis shoes
d)
no opportunity cost
35.
Riddle:  I give consumers control of the economic market.  Consumers determine through buying goods and serices what goods and services will be produced. I am called -
a)
competition
b)
business expansion
c)
profit motive
d)
consumer sovereignty
36.
a consumer's willingness and ability to purchase a good or service
a)
supply
b)
producer
c)
demand
d)
incentive
37.
the amount of a product or service that is available for consumers to buy
a)
demand
b)
supply
c)
incentives
d)
producer
38.
actions, awards or rewards that influence the choices people make
a)
market economy
b)
voluntary exchange
c)
incentives
d)
competition
39.
Man-made resources used in the production process i.e. machines in a factory.
a)
Labour
b)
Capital
c)
Household
d)
Revenue 
40.
Which condition would lead to the highest prices?
a)
Low supply, high demand
b)
high supply, high demad
c)
High supply, low demand
d)
Low supply, low demand
41.
In general, if the price of a good or service goes up, what happens to the demand for that good or service?
a)
demand goes up
b)
demand stays the same
c)
demand goes down
d)
none of the above
42.
What a business has left after all the bills have been paid?
a)
supplies
b)
taxes
c)
profit
d)
debt
43.
Which economic system allows the government to decide the Means of Production?
a)
Command
b)
Market
c)
Traditional
d)
Mixed
44.
There are four types of economic systems.  Most economies in the world are _____ economic systems. 
a)
Traditional 
b)
Command 
c)
Market 
d)
Mixed
45.
I am a farmer in Africa, and have always traded for my goods.  I have a _____ economy. 
a)
Traditional 
b)
Command 
c)
Market
d)
Mixed
46.
In this type of economy, the government places control on businesses, but the individual decides what to make. 
a)
Mixed
b)
Market
c)
Command 
d)
Traditional
47.
The thing that you give up (the next best alternative) when you make a decision is known as
a)
Opportunity Cost
b)
Scarcity
c)
Incentive
d)
Choice
48.
Individuals buy __________ from businesses.
a)
products
b)
profit
c)
resources
d)
income
49.
__________ own resources.
a)
Businesses
b)
Individuals
c)
Profit
d)
Income
50.
The situation in which unlimited wants exceed the limited resources available to fulfill those wants.
a)
Market 
b)
Tradeoff
c)
Scarcity 
d)
Equity 
51.
The United States has a __ economy.
a)
traditional
b)
mixed
c)
free market
d)
command
52.
Which is an example of an entrepreneur?
a)
People who operate a hospital.
b)
A person who runs a govearnment-owned coal mine.
c)
Roofers who work for a business owned by an individual.
d)
A person who uses his or her money to start a business selling cell phones.
53.
Which of the following is NOT a factor of production?
a)
Land
b)
Time
c)
Workers
d)
Capital
54.
Which type of economic system is a combination of privately-owned industry and government control?
a)
Traditional
b)
Mixed
c)
Command
d)
Market
55.
The hammer a carpenter uses to build a house is -
a)
a natural resource
b)
capital
c)
a human resource
d)
entrepreneurship
56.
In which type of economic system can businesses operate without ANY government regulation? 
a)
Free Market
b)
Traditional
c)
Command
d)
Mixed Market
57.
Which of the following is NOT one of the questions every economic system must answer?
a)
How to produce?
b)
What to produce?
c)
Who will produce?
d)
Whom to produce for?
58.
Riddle:  When people cannot get all they want or need at the same time, they blame me for limited resources, goods, and services.  I am called -
a)
debt
b)
production
c)
supply and demand
d)
scarcity
59.
If businesses produce more goods or provide more services than cosumers demand, then the price will -
a)
increase
b)
increase, and then immediately decrease
c)
stay the same
d)
decrease
60.
If the demand for a product exceeds the supply, what will happen to the price?
a)
The price goes up.
b)
The price stays the same.
c)
The price immediately goes up, then down.
d)
The price goes down.
61.
Chloe wanted to buy a new sweater, but she really needed a new pair of tennis shoes.  When her mom took her shopping at Kohls, she ended up buying the tennis shoes.  What was her opportunity cost?
a)
Kohls
b)
the sweater
c)
the tennis shoes
d)
no opportunity cost
62.
The amount of money exchanged for a good or service is called the -
a)
choice
b)
resource
c)
price
d)
incentive
63.
Riddle:  I give consumers control of the economic market.  Consumers determine through buying goods and serices what goods and services will be produced. I am called -
a)
competition
b)
business expansion
c)
profit motive
d)
consumer sovereignty
64.
Effect:  better quality goods and    services at a lower priceCause:  ?
a)
profit
b)
competition
c)
consumer sovereignty
d)
a monopoly
65.
The balance of what two things determines the price of a good or service?
a)
supply and demand
b)
producers and consumers
c)
losses and profits
d)
output and resource markets
66.
All of the following are characteristics of the U.S. economy except-
a)
Markets are allowed to operate without undue interference from the government.
b)
Individuals and businesses have the right to own property as well as the means of production without undue interference from the government.
c)
Prices are determined by supply and demand as individual buyers and sellers interacat in the marketplace.
d)
Central ownership (usually by the government) of property and resources is common.
67.

Which of the following is NOT one of the basic questions of economics?

a)

What will be produced?

b)

How will it be produced?

c)

What will it be produced with?

d)

For whom will it be produced?

68.

___________________ is the inability to satisfy all wants at the same time.

a)

Scarcity

b)

Resources

c)

Choice

d)

Production

69.

Resources are factors of production that are used in the production of goods and services. Please select the 4 types of resources.

a)

Natural

b)

Human

c)

Capital

d)

Time

e)

Entrepreneurship

70.

_________________ is selection of an item or action from a set of possible alternatives.

a)

Production

b)

Scarcity

c)

Resources

d)

Choice

71.

_______________ ______________is what is given up when a choice is made (the second best alternative).

a)

Opportunity cost

b)

Supply and Demand

c)

Free Market

d)

Mixed Economy

72.

_______________ is the combining of human, natural, capital, and entrepreneurship resources to make goods or provide services.

a)

Choice

b)

Production

c)

Consumption

d)

Resources

73.

_________________ is the using of goods and services.

a)

Consumption

b)

Resources

c)

Scarcity

d)

Production

74.

In what type of economy are decisions based on custom and historical precedent and people often perform the same type of work as their parents and grandparents, regardless of ability or potential.

a)

Free market economy

b)

Command economy

c)

Traditional economy

d)

Mixed economy

75.

In what type of economy is there Central ownership (usually by government) of property/resources and centrally planned economy. Also there is lack of consumer choice

a)

Traditional economy

b)

Free market economy

c)

Mixed economy

d)

Command economy

76.

In what type of economy is there private ownership of property/resources , profit motive, competition, consumer sovereignty, individual choice and minimal government involvement in the economy.

a)

Traditional economy

b)

Free market economy

c)

Command economy

d)

Mixed economy

77.

In what type of economy are individuals and businesses owners the decision makers for the private sector. The government is owner and decision maker for the public sector. The government’s role is greater than in a free market economy and less than in a command economy. Most economies today, including the United States, are mixed economies.

a)

Mixed economy

b)

Command economy

c)

Free market economy

d)

Traditional economy

78.

The interaction of ______________ and ___________ determines price?

a)

Consumer preferences

b)

Opportunity cost

c)

Production and Consumption

d)

Supply and Demand

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