Master the Basics of Economics

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Define economics.

The study of how individuals and societies make choices about the use of unlimited resources to satisfy their scarce wants.
The study of how individuals and societies make choices about the use of scarce resources to satisfy their unlimited wants. (correct)
The study of how individuals and societies make choices about the use of unlimited resources to satisfy their unlimited wants.
The study of how individuals and societies make choices about the use of scarce resources to satisfy their scarce wants.

Define scarcity.

The unlimited availability of resources to satisfy unlimited wants.
The limited availability of resources to satisfy limited wants.
The limited availability of resources to satisfy unlimited wants. (correct)
The unlimited availability of resources to satisfy limited wants.

Define the 4 factors of production.

Land, labor, money, and entrepreneurship.
Land, labor, capital, and entrepreneurship. (correct)
Land, labor, money, and management.
Land, labor, capital, and management.

Define entrepreneur.

A person who starts a business. (A) Signup and view all the answers

Define opportunity cost.

The cost of an opportunity that is given up. (B) Signup and view all the answers

Define efficiency.

The ability to produce goods and services using fewer resources. (B) Signup and view all the answers

Define incentives. How do they motivate people.

Rewards or penalties that motivate people to take certain actions. (B) Signup and view all the answers

What is the main incentive for a business.

Profit (B) Signup and view all the answers

Which of the following best describes a Production Possibilities Graph?

A visual representation of the relationship between two goods that an economy can produce given its resources and technology. (A) Signup and view all the answers

How can an economy increase its production possibilities?

By investing in capital goods and improving technology. (A) Signup and view all the answers

How does a Production Possibilities Graph show opportunity cost?

By illustrating the trade-offs between producing one good over another. (B) Signup and view all the answers

What are the 3 key economic questions?

What to produce, how to produce, and for whom to produce. (C) Signup and view all the answers

What is market failure?

When the allocation of goods and services by a free market is not efficient or fair. (A) Signup and view all the answers

What does a Production Possibilities Graph show?

The relationship between the production of two goods (A) Signup and view all the answers

How can an economy increase its production possibilities?

By increasing the availability of resources (B) Signup and view all the answers

How does a Production Possibilities Graph show opportunity cost?

By representing the trade-offs between producing different goods (C) Signup and view all the answers

What are the 3 key economic questions?

How to increase production, how to allocate resources, how to distribute goods (A) Signup and view all the answers

Define market failure.

When the free market fails to allocate resources efficiently (D) Signup and view all the answers

What does a Production Possibilities Graph show?

The relationship between production possibilities (D) Signup and view all the answers

How can an economy increase its production possibilities?

By increasing the efficiency of resource use (B) Signup and view all the answers

What does a Production Possibilities Graph show about opportunity cost?

It shows the cost of producing one good in terms of the other (B) Signup and view all the answers

What are the 3 key economic questions?

What to produce, how to produce, and for whom to produce (A) Signup and view all the answers

What is market failure?

When the market is unable to allocate resources efficiently (A) Signup and view all the answers

Which of the following best describes free enterprise?

An economic system where individuals and businesses have the freedom to own and operate their own businesses (C) Signup and view all the answers

What is market failure?

When the market is unable to allocate resources efficiently (C) Signup and view all the answers

How do consumers tell the government and businesses what they want?

By buying or not buying certain products (C) Signup and view all the answers

Master the Basics of Economics

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Questions and Answers

Define economics.

Define scarcity.

Define the 4 factors of production.

Define entrepreneur.

Define opportunity cost.

Define efficiency.

Define incentives. How do they motivate people.

What is the main incentive for a business.

Which of the following best describes a Production Possibilities Graph?

How can an economy increase its production possibilities?

How does a Production Possibilities Graph show opportunity cost?

What are the 3 key economic questions?

What is market failure?

What does a Production Possibilities Graph show?

How can an economy increase its production possibilities?

How does a Production Possibilities Graph show opportunity cost?

What are the 3 key economic questions?

Define market failure.

What does a Production Possibilities Graph show?

How can an economy increase its production possibilities?

What does a Production Possibilities Graph show about opportunity cost?

What are the 3 key economic questions?

What is market failure?

Which of the following best describes free enterprise?

What is market failure?

How do consumers tell the government and businesses what they want?

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