Intro to Economics Quiz

What does scarcity in economics refer to?

• Abundance of resources
• Limited availability of resources
• Equal distribution of resources
• Surplus of resources

Imagine you're on a deserted island. Which term would you use to describe the things you'd wish for, like a luxury yacht or a gourmet meal, but aren't essential for your survival?

• Needs

• Scarcity

• Wants

• Opportunity cost

Imagine you're a budding economist! Can you tell us which primary factor of production represents natural resources?

• Labor

• Capital

• Land

• Entrepreneurship

Imagine you're in a bustling market economy! Who do you think is the main decision-maker here?

• Is it the government?

• Or maybe the producers and consumers?

• Could it be the central planners?

• Or is it tradition and customs?

Imagine you're a time traveler! You've landed in a place where customs and traditions dictate what gets produced and consumed. Can you guess what type of economy this place has?

• Market economy

• Command economy

• Traditional economy

• Mixed economy

What is the main characteristic of a command economy?

• Private ownership of resources
• Government control of resources
• Equal distribution of wealth
• Minimal government involvement

Imagine you're the president! National defense falls under which category of goods in your budget?

• Public good

• Private good

• Free good

• Inferior good

Imagine you're an economist for a day! Can you tell which one of these would be a fundamental question you'd have to tackle?

• How to turn the company into a money-making machine?

• What goodies should we produce today?

• What's the hottest investment strategy right now?

• How to make scarcity disappear like a magic trick?

Imagine you're a business tycoon! You've to make a tough choice and you can only pick one option. What would you call the value of the next best alternative that you're giving up?

• The total cost of your empire's production

• The cost of all the goods and services in your empire

• The opportunity cost

• The cost of all the raw materials in your empire

Imagine you're the head of the Federal Reserve. What would be your primary responsibility in the United States?

• Deciding the income taxes

• Controlling the interest rates and the money supply

• Setting the stock market prices

• Regulating international trade