Economy Review

How do households affect the economy?

• They collect taxes on goods.

• They create the supply of goods.

• They create demand for goods.

• They collect profits by selling goods.

Which statement about the business sector of the economy is correct?

• It provides public services.

• It produces goods.

• It provides labor.

• It loans out money.

Eric has a job and wants to buy a house, but he cannot afford one right now. What is the quickest way for Eric to gather enough money to buy a house?

• starting his own private business

• placing his money in a bank to earn interest

• saving a large portion of his income

• applying for a loan from a bank or credit union

Which statement about the business sector of the economy is correct?

• It sells labor to households.

• It gives loans to the government

• It provides services to households.

• It collects taxes from the government.

What was the biggest risk that Sam took when she opened her shop?

• the chance that the shop might be robbed one day

• not being able to find competent, hard-working employees

• that she could lose a lot of money if the shop was not successful

• the possibility that she might run out of bread or cheese during a lunch rush

Which term refers to the rivalry among businesses to supply goods and services to consumers?

• competition

• incentive

• specialization

• price