WorksheetsPrinciples Unit 11 Economic Concepts Vocabulary Review
Total questions: 52
Worksheet time: 26mins
Which term best describes the economic problem of unlimited human wants in a world of limited resources?
Productivity
Specialization
Surplus
Scarcity
Human necessities are best defined as
monetary assets used by businesses
goods and services desired for comfort
goods and services necessary to survival
materials used to produce other goods
Capital goods are
finished goods purchased by households
skills used to manage employees
materials used to produce goods and services
natural resources like sun and soil
Land, as a factor of production, refers to
urban property available for new factories
government-owned plots for public projects
unused wilderness preserved for nature
natural resources used in production of goods and services
Human resources include
management
labor
financial capital
entrepreneurship
Labor in economics means
volunteer activities without payment
time spent learning new information
only physical work done in factories
any work necessary in producing goods and services
Management is best defined as a
person who attempts to make profit from an idea
set of natural resources used in production
government agency planning the economy
tool used to organize financial data
Entrepreneurship refers to
human skills to start and run a business
financial assets for operating a business
machinery used in making products
laws that regulate market competition
Economic utility means the
fair distribution of income and wealth
value added to a product through usefulness
number of units produced per worker
ability of firms to lower costs
Which utility increases when a store stays open late?
Information utility
Place utility
Form utility
Time utility
Making a product available at a bus stop kiosk mainly increases
Productivity
Possession utility
Form utility
Place utility
Changing raw materials into a finished product primarily improves
Information utility
Time utility
Possession utility
Form utility
Offering multiple payment methods is most related to
Productivity
Time utility
Place utility
Possession utility
Which action increases information utility?
Moving goods closer to buyers
Reducing price for quick sale
Extending hours for convenience
Providing clear instructions and details
Productivity is the
effectiveness of production
total goods wanted by consumers
share of profit kept by owners
amount of natural resources available
A surplus occurs when
resources are too scarce to produce
demand exceeds supply at current prices
workers specialize in one task only
product is produced in larger quantities than demanded
Specialization means
allocating resources equally across tasks
producing many unrelated goods and services
training workers only in general skills
focusing time and effort on a limited range
Return in economics is the
amount of goods moved to market
wages earned per hour of labor input
profit made or lost from a specific good or service
value created by product usefulness
The law of diminishing returns states that at some point adding more inputs to production
eliminates scarcity entirely
guarantees higher profits
always doubles total output
will not improve returns
In a market economy, most decisions are guided by
international trade agreements
tradition and custom rules
a central government planner
the economy’s consumers
Capitalism is a system in which trade and industry are controlled by
nonprofits for service
workers’ councils for equity
state planners for goals
private owners for profit
Socialism involves
full control of markets by private firms
complete absence of public services and taxes
only voluntary charities replacing the state
increased government involvement and more social services
Which policy uses government taxing and spending decisions to influence the economy?
Trade quotas for certain imports
Price controls on specific goods
Monetary policy via interest rates
Fiscal policy on budgets and taxes
What is the main focus of monetary policy?
Increasing labor unions
Raising import tariffs
Setting business locations
Regulating the money supply
Which indicator measures the value of all final goods and services produced within a country's borders?
Gross National Product (GNP)
Gross Domestic Product (GDP)
Consumer Price Index (CPI)
Gross National Income (GNI)
Match each concept to its best description.
Fiscal Policy
Government taxes and spending choices
Monetary Policy
Money supply and price stability tools
CPI
Prices of consumer goods index
PPI
Prices of wholesale goods index
Unemployment Rate
Share of people without jobs
Match each business cycle phase to its description.
Expansion
Increasing economic activity
Contraction
Decreasing economic activity
Peak
Highest economic activity
Trough
Lowest economic activity
Which statement best distinguishes price competition from non-price competition?
Non-price competition raises taxes
Price competition highlights brand logos
Non-price competition lowers wages
Price competition emphasizes sale price
Oligopoly is best described as a market where:
A few firms influence prices
Many buyers set all prices
One firm has all control
Government fixes every price
Risk in a free enterprise system refers to the:
Elimination of competition
Fixed government subsidies
Guaranteed steady profits
Possibility of loss or failure
Profit is the:
Income after costs are deducted
Government tax on earnings
Value of unpaid inventory
Total sales before any costs
Supply is the:
Rise in currency value
Cost of government budgets
Desire to buy a product
Amount of a product available
A surplus occurs when:
Prices fall in contraction
Demand exceeds production
Imports exceed exports
Production exceeds demand
A shortage occurs when:
Unemployment rises sharply
Prices of inputs decrease
Production exceeds demand
Demand exceeds production
Equilibrium in a market occurs when:
Quantity demanded equals quantity supplied
Supply greatly exceeds demand
Prices are fixed by government
Demand is greater than supply
Which measure tracks the change in prices of consumer goods and is known as the cost-of-living index?
Rate of unemployment
Gross National Income (GNI)
Producer Price Index (PPI)
Consumer Price Index (CPI)
The rate of inflation is the:
Share of workers without jobs
Total value of exports sold
Rate of rising prices in a country
Difference between GNP and GDP
Which statement about recession is correct?
A phase of maximum activity
Two years of high unemployment
A single month of falling prices
Two or more quarters of decreasing GDP
Gross National Product (GNP) primarily measures:
Change in consumer price levels
Share of people unemployed
Only goods made within borders
Total output by a country's residents
Gross National Income (GNI) includes:
Income earned by residents and businesses
Wholesale price changes only
Only government budget surpluses
Exports minus imports value
Economic interdependence means countries:
Rely on each other for certain goods
Produce everything more efficiently
Avoid international trade entirely
Set identical tax policies
Imports are best defined as:
Goods and services purchased from other countries
Goods only produced within national borders
Taxes collected on foreign products
Money earned by domestic businesses
Which system encourages people to start businesses with minimal government involvement?
Free enterprise system
Command economy model
Traditional barter system
Single-payer structure
Communism is an economic and political system where:
Banks control the currency
Firms freely maximize profits
Markets set all prices
Property is publicly owned
Which term means goods and services sold to other countries?
Tariffs
Embargoes
Quotas
Exports
Imports
Producing a product more efficiently and at lower cost than another country describes which concept?
Import quota limit
Trade union treaty
Comparative advantage
Laissez-faire policy
Absolute advantage
Which statement best describes laissez-faire in economics?
Minimal government involvement in commerce
Quotas on all import categories
High tariffs to protect industries
Government sets all market prices
Complete ban on foreign products
What is a tariff?
Fee for consumers
Subsidy for producers
Tax on imports
Ban on exports
Limit on quantities
A tariff designed to raise prices on imports to help domestic producers is called a:
Protective tariff
Sales surcharge
Revenue tariff
Market quota
Export duty
Which policy is a complete ban on certain products entering or leaving a country, often for political reasons?
Subsidy
Quota
Tariff
Sanctioned rebate
Embargo
Which is the primary mission of NAFTA?
Ban agricultural imports among members
Collect tariffs to fund member governments
Establish a worldwide trade court
Reduce trade barriers and investment limits in North America
Set a common currency for three countries
The European Union is best described as:
A customs union between Switzerland and Norway
A defense pact among Eastern European nations
A trade alliance of 28 European nations working as a single market
A global agency overseeing shipping lanes
An American organization promoting tariffs
