30 Questions
What is the most important characteristic of market-based economies?
Private property rights
What is the term used in economics to describe the value of the best alternative not chosen?
Opportunity cost
Which type of cost is the money paid when a choice is made?
Explicit cost
What is the total of explicit costs and implicit costs called?
Opportunity cost
What do economists like to say every choice has?
A cost
Which term is often used interchangeably with opportunity cost in economics classes?
Cost
What is the basic assumption in Microeconomics about how people make choices?
People act in their own best interest
Which of the following is NOT considered a resource in economics?
Money
What is human capital?
The skills and knowledge of a worker
Which of the following is an example of physical capital?
Machines
What is the role of an entrepreneur in the economy?
To take risks and produce goods or services
What is opportunity cost?
The value of the next best alternative that is forgone
What are the three basic economic questions that every society must answer?
What to produce, how to produce, and for whom to produce
Which economic system relies on custom and culture to answer the basic economic questions?
Traditional economy
Which of the following is the best definition of scarcity?
The problem of limited resources and unlimited wants
What is the main difference between scarcity and shortage?
Scarcity is a problem of unlimited wants and limited resources, while shortage is when items sell out at the current price
Which of the following is NOT one of the 3 productive resources?
Money
What is the term used to describe resources that come from nature?
Land
Which of the following is an example of labor as a resource?
Work done by people
What is the relationship between scarcity and price?
The more scarce an item is, the higher its price tends to be
What is the main problem that scarcity poses for people?
Limited resources are insufficient to fulfill people's wants
If the total benefit of going to the movies is larger than the total cost, what would a rational person do?
Go to the movies
What is the term often used to refer to the satisfaction that comes from consuming a good or service for consumers?
Utility
What is the term often used to refer to the money brought in by selling a good or service for businesses?
Revenue
What does the Production Possibilities Curve (PPC) illustrate?
Different combinations of two goods that can be produced with fixed resources
What does the opportunity cost on a PPC graph represent?
The cost of producing one good in terms of the other good that must be given up
If an economy produces at point 2 instead of point 1 on a PPC graph, what is the opportunity cost of 6 additional units of consumer goods?
13 units of capital goods
What is the term often used to refer to the satisfaction that comes from consuming a good or service for businesses?
Revenue
What is the term often used to refer to the money brought in by selling a good or service for consumers?
Utility
If the total cost of going to the movies is larger than the total benefit, what would a rational person do?
Not go to the movies
Test your knowledge on market economies and capitalism! This quiz will cover topics such as individual decision-making, resource efficiency, and the significance of private property rights. Challenge yourself and become an expert on market-based economies.
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