Economics - Unit 1 Review - Fundamentals

Front

A company decided to upgrade its computer systems, delaying plans to expand its office space. This situation is an example of

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opportunity cost.

Front

What is the primary reason that scarcity exists in all economies?

Back

Resources are limited while human wants are unlimited.

Front

Which situation is an example of entrepreneurship?

Back

Priya opened her own bakery and employs several workers.

Front

Refer to the news headline below. Which economic factor of production is highlighted as a concern in this headline? Options: shortage of skilled workers, insufficient technological innovation, reliance on entrepreneurship, reliance on natural resources.

Back

reliance on natural resources

Front

When workers focus on a single step in the production process, this is known as

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specialization.

Front

At a bakery, Priya is responsible for only kneading the dough while other workers handle different tasks. This is known as

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specialization.

Front

What is the most likely reason for a retail manager to implement a pay structure with a base salary plus a 10% commission on sales?

Back

To motivate employees to increase their sales performance.

Front

In the past year, many employees have left Company A to work at Company B. Which of the following best explains this trend?

• The employees want to be promoted more quickly.
• Company B offers more earning potential.
• The employees value non-monetary incentives.
• Company A makes employees feel more appreciated.

Back

The employees value non-monetary incentives.

Front

What is the opportunity cost of Michael volunteering at the animal shelter? Michael spends his weekends volunteering at a local animal shelter. He loves helping the animals and feels good about making a difference. However, volunteering means he cannot take a part-time job like some of his friends, and he misses out on earning extra spending money. He also has to pay for his own transportation to the shelter, but his family is proud of his commitment.

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the extra spending money he could have earned from a part-time job

Front

Is the trade between Aria and Liam an example of voluntary trade? Why or why not?

Back

Yes, because both parties willingly traded and benefited from the trade.