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Basics Of Economics

Total questions: 31

Worksheet time: 31mins

Name
Class
Date
1.
Which type of economic system is based on customs and beliefs?
a)
traditional economy
b)
mixed economy
c)
command economy
d)
market economy
2.
Who answers all economic questions in a market economy?
a)
religious authorities within individual communities
b)
the government
c)
national legislatures
d)
individual citizens (producers + consumers)
3.
Who makes all economic decisions in a command economy?
a)
individual citizens (producers + consumers)
b)
national legislatures
c)
religious authorities within individual communities
d)
the government
4.
How does specialization assist the economies of all countries?
a)
It restricts trade between countries.
b)
It motivates countries to migrate closer to command economies.
c)
It encourages trade between countries.
d)
It does not affect trade between countries.
5.
How does specialization encourage trade between countries?
a)
Countries cannot specialize in all products, so they trade for what they need and want.
b)
Countries must specialize in more than fifty percent of the products they produce for export.
c)
Countries are allowed to become experts in all products, so they do not need to trade for goods.
d)
Countries are allowed to decide what to produce, how to produce, and for whom to produce.
6.
Why is a system of currency exchange necessary for international trade?
a)
Nearly all world currencies are worthless on the international market.
b)
Those selling goods on the international market only accept payment in gold and silver.
c)
Most goods bought on the international market must be bought using United States dollars.
d)
There must be a way to pay for goods purchased from countries with different types of currencies.
7.
Why is it important to have a system to convert from one currency to another?
a)
The banks are not able to handle different kinds of currencies.
b)
Converting currency makes it possible to buy and sell goods between nations with different types of money.
c)
The conversion to different currencies makes goods cost less.
d)
The dollar is the most valuable currency in the world today.
8.
Which of these must be present for international trade to be successful?
a)
a system for imposing protective tariffs
b)
a system for securing borders
c)
a system for raising taxes
d)
a system for exchanging currencies
9.
What is human capital?
a)
the money spent to educate and train workers
b)
the total agriculture produced by a nation in one year
c)
government-owned businesses
d)
factories and industries
10.
If a country does not invest in its human capital, how can it affect the country’s gross domestic product (GDP)?
a)
Most workers want to keep their jobs and do not care about GDP.
b)
Investment in human capital has little effect on a country’s GDP.
c)
GDP may not increase because poorly trained workers will not be able to do their jobs as well.
d)
GDP is only affected if workers pay for the investment out of their own pockets.
11.
What are capital goods?
a)
the goods and services that are produced for a country’s economy
b)
the factories, machinery, and technology used to make goods
c)
the money spent to train workers to use new technology
d)
the workers who make the goods and services
12.
If a country does invest in capital goods, how can it affect the country's gross domestic product (GDP)?
a)
GDP may increase because the workers are able to more efficiently produce goods.
b)
Investment in capital goods has little effect on a country’s GDP.
c)
GDP is only affected if workers pay for the investment out of their own pockets.
d)
Most workers want to keep their jobs and do not care about GDP.
13.
The situation in which unlimited wants exceed the limited resources available to fulfill those wants.
a)
Market 
b)
Tradeoff
c)
Scarcity 
d)
Equity 
14.
The highest-valued alternative that must be given up to engage in an activity.
a)
Scarcity 
b)
Factors of Production 
c)
Innovation
d)
Opportunity Cost 
15.

________________ is the study of how people decide what they want and what they are willing to pay or give in order to get it.

a)

Economics

b)

Supply and Demand

c)

Capitalism

d)

Personal Finance

16.

Panic At The Disco is on tour! Tickets have almost sold out. Since supply of tickets is low, what will likely happen to the price?

a)

Decrease

b)

Increase

c)

Remain the same

d)

Tickets will stop selling

17.

Soil, minerals, air, water, and coal are all examples of

a)

fossil fuels

b)

conservation

c)

recycling

d)

natural resources

18.
How do you satisfy your unlimited wants in a world of limited resources?
a)
by making more money
b)
by making choices
c)
by stealing
d)
by setting a budget
19.
An entrepreneur is someone 
a)
Someone who works for a new business
b)
Someone who starts a new business
c)
Someone who takes over an existing business
d)
Someone who does not want to work
20.

The study of behavior of individual households, firms, and governments...

a)

Microeconomics

b)

Macroeconomics

c)

Economics

21.
"Country X" has an economic system in which individual citizens and the government share responsibility in answering economic questions.  This is an example of a:
a)
traditional economy
b)
market economy
c)
mixed economy
d)
command economy
22.

Check all that are factors of production.

a)

Land

b)

Finance

c)

Capital

d)

Labor

e)

Weather

23.

Which person would be considered an entrepreneur?

a)

Employee at Wal-Mart

b)

Railroad worker

c)

Car salesman

d)

Owner of a restaurant

24.

Economics only concerns money.

a)

True

b)

False

25.

Gifts of nature, not created by human effort.

a)
b)
c)
d)
26.

Choose the image that is an economic example of "capital".

a)
b)
c)
d)
27.

Which is not a basic economic question?

a)

What to produce

b)

Where to produce

c)

How to produce

d)

For whom to produce

28.

Oxygen, water, and food are economic examples a ........

a)

need

b)

want

c)

good

d)

service

29.

Laissez-faire means.....

a)

the government should control the economy

b)

the government should buy all goods

c)

the government should have a "hands off approach" to the economy

d)

the government should be abolished

30.

If a business is constantly improving their machinery, worker skills, and time management, they are attempting to improve overall....

a)

leadership

b)

productivity

c)

entrepreneurship

d)

division of labor

31.

Amazon is an example of a......

a)

Storefront

b)

factor

c)

market

d)

magical place that sells anything your heart desires.

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