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Economics: Choices & Scarcity

Total questions: 15

Worksheet time: 5mins

Name
Class
Date
1.

Identify the terms used to describe the materials used to produce goods/services.

a)

FOP, input, results

b)

resources, labor, trade-offs

c)

actors of production, goods, intermediate goods

d)

factors of production, resources, input

2.

Economics is the study of

a)

Money

b)

Factors of Production

c)

Choices

d)

Resources

3.

The study of Economics demonstrates how people make choices

a)

respond to natural disasters (hurricanes & earthquakes)

b)

to gain knowledge from experience

c)

from limited resources to satisfy unlimited needs & wants

d)

to calculate their income taxes

4.

I am the hammer used to build houses in a construction company. What type of capital am I?

a)

physical capital

b)

entrepreneurial capital

c)

human capital

d)

financial capital

5.

Why are choices necessary?

a)

because we have multiple options

b)

because entrepreneurs want to make a profit

c)

because some resources are scarce

d)

because all resources are scarce

6.

What is FOP?

a)

Factors of production

b)

Components used in the creation of goods & services (G/S)

c)

Resources

d)

All of these answers are correct

7.

What is opportunity cost (OC)?

a)

always a monetary cost

b)

any missed opportunity

c)

value of next best alternative after a choice is made

d)

always the same for everyone

8.

What are trade-offs?

a)

alternatives sacrificed when you make a choice

b)

unsuccessful trading of goods & services

c)

countries with which the US has trade embargoes

d)

goods and services traded to other countries

9.

Which of the following do economists refer to as labor?

a)

crops

b)

tractors

c)

teachers

d)

factories

10.

What is the fundamental economic problem?

a)

inflation, because it erodes a person’s buying power

b)

the universal, on-going condition of scarcity

c)

the universal, on-going condition of shortage

d)

a man-made condition all individuals and nations must face

11.

Which of the following is considered land?

a)

teachers, because they are a naturally occurring substance

b)

buildings, because they are built on land

c)

trucks, because they are used to produce goods/services

d)

oil, because it is a naturally occurring substance

12.

What is the difference between needs and wants?

a)

wants are necessary for survival; needs are luxury items

b)

everyone has the same wants

c)

wants are luxury items; needs are necessary for survival

d)

wants are limited and needs are unlimited for everyone

13.

(a)   is the factor of production that combines the other 3 FOP into goods and services.

14.

Jim chooses to work an extra hour at $15/hour rather than study another hour for a test; his OC:

a)

loosing his job because he is replaced with someone else

b)

is not passing his test because he didn't study enough

c)

loosing out on an additional $15

d)

leaving his boss short on labor for the evening

15.

What is the difference between goods and services?

a)

goods are performed; services can be touched

b)

goods can be touched; services are performed

c)

goods are intangible assets; service are tangible

d)

none of these answers are correct; there is no difference