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WorksheetsUnit 2 Exploring Economics Exam
Total questions: 40
Worksheet time: 40mins
What is scarcity in economics?
The abundance of resources to satisfy all wants and needs.
The lack of resources to satisfy all wants and needs.
The surplus of goods and services.
The unlimited availability of money.
What happens to the price of a product if the supply increases while the demand remains constant?
The price decreases.
The price increases.
The price remains the same.
The price fluctuates randomly.
Explain how supply and demand work together to determine the price of a product.
Supply and demand are unrelated to price determination.
Supply and demand together determine the price by balancing the quantity supplied and demanded.
Only supply determines the price, demand has no effect.
Only demand determines the price, supply has no effect.
What is the definition of opportunity cost?
The cost of all alternatives when making a choice.
The value of the next best alternative you give up when making a choice.
The total cost of all resources used.
The financial cost of a decision.
Which of the following is an example of an incentive?
A penalty for not completing homework.
A reward for completing a task.
A rule that must be followed.
A law that prohibits certain actions.
Describe a scenario where inflation affects consumer purchasing power.
Inflation increases purchasing power, allowing consumers to buy more.
Inflation decreases purchasing power, making goods and services more expensive.
Inflation has no effect on purchasing power.
Inflation stabilizes purchasing power, keeping prices constant.
What happens to the price of a product if the demand increases while the supply remains constant?
The price decreases.
The price increases.
The price remains the same.
The price fluctuates randomly.
Identify the concept: "The amount of goods or services available that producers are willing to sell at different prices."
Demand
Supply
Scarcity
Inflation
If a consumer chooses to buy a video game instead of saving for a bike, what economic concept does this decision illustrate?
Inflation
Scarcity
Opportunity Cost
Incentive
How might a government use incentives to encourage businesses to reduce pollution?
By imposing fines on businesses that pollute.
By offering tax breaks to businesses that implement green technologies.
By ignoring pollution issues.
By increasing taxes on all businesses.
Which of the following is an example of scarcity?
Unlimited money
Time limited to 24 hours a day
Infinite resources
Endless supply of goods
What happens to the price of goods when supply increases?
Price goes up
Price goes down
Price remains the same
Price fluctuates randomly
What is demand?
The amount of goods producers are willing to sell
How much of a good or service consumers want
The surplus of goods
The lack of resources
Define supply in economic terms.
The amount of goods or services consumers want
The amount of goods or services available
The demand for goods
The scarcity of resources
Explain how supply and demand work together to determine prices.
They work independently to set prices
Supply and demand together determine prices based on their levels
Only demand affects prices
Only supply affects prices
Describe the effect of inflation on the value of money.
Increases the value of money
Reduces the value of money
Has no effect on the value of money
Stabilizes the value of money
If the demand for a product increases, what is likely to happen to its price?
The price will decrease
The price will increase
The price will remain the same
The price will fluctuate randomly
How does scarcity influence economic decision-making?
It has no influence on decision-making
It forces choices due to limited resources
It leads to unlimited choices
It simplifies decision-making
What is the relationship between supply and price?
As supply increases, price increases
As supply increases, price decreases
Supply and price are unrelated
Supply always equals price
How do economists contribute to understanding economies?
By creating goods
By analyzing data
By selling services
By controlling prices
In which type of economy does the government control production and prices?
Market Economy
Mixed Economy
Command Economy
Traditional Economy
Which of the following best describes a luxury?
Essential for survival
Expensive but not necessary
A basic need
A government service
Identify the economic system where supply and demand determine prices.
Command Economy
Market Economy
Mixed Economy
Traditional Economy
What is the study of how people use resources to meet their needs and wants called?
Economy
Economics
Economic System
Market Economy
How do economists contribute to understanding economies?
By creating goods
By analyzing data
By selling services
By controlling prices
Which of the following is an example of a tangible item?
Haircut
Car repair
Food
Tutoring
Evaluate the benefits and drawbacks of a mixed economy. Which statement is true?
It eliminates government intervention
It combines elements of both market and command economies
It relies solely on consumer choice
It prevents private enterprise
Analyze the impact of choosing to buy a video game over new shoes. What is the opportunity cost in this scenario?
The enjoyment from the video game
The money spent on the video game
The new shoes you did not buy
The time spent playing the game
Which of the following is a need rather than a want?
Latest smartphone model
Basic healthcare
Designer clothes
Luxury car
George earns a $250 bonus at his job for increasing his output by an additional 50% two weeks in a row. He makes a list of what he wants to buy with his bonus: 1: the latest model of Adidas athletic shoes; 2: Air Pods; 3: a new coat. He buys Adidas. What is his opportunity cost?
the Air Pods
the shoes
the coat
the cash
Michael has been invited by a friend to go fishing on Friday. His parents are going to a concert. Michael chooses to go fishing with his friend. What is his opportunity cost?
fishing with a friend
going to a concert
Andrea has planned a trip to the beach for her family on Labor Day. Her daughter has been invited to the mountains by a friend. Her daughter decides to go to the beach. What is her opportunity cost?
a trip to the beach
a trip to the mountains
Lydia brought a salad for lunch today. Michelle is ordering pizza and asks Lydia is she would like to order. Lydia decides to eat her salad, what is her opportunity cost?
salad
pizza
Josh's birthday is coming up. He wants a pair of beats headphones and a PS4. His Mom says he can only get one item. He chooses the PS4, what is his opportunity cost?
beats headphones
PS4
Jaleigh is going shopping with her Aunt and has $20. She wants to buy a pair of jeans and a shirt. The jeans are $15 and the shirt is $20. Jaleigh decides to buy the jeans, what is her opportunity cost?
jeans
shirt
Who controls the factors of production in a command economy?
government
classes
individuals
oligarchs
What factor determines an economic decision?
the benefit should outweigh the cost
a purchase should be made only for needs not wants
credit purchasing promotes financial freedom
whether or not the item can be acquired
Why is understanding incentives important?
Without the proper incentive, a policy is not going to work
Incentives always cause an increase in production
Incentives can help the government regulate business
Consumers require incentives to purchase
