Basic Economics Quiz

What is economics often referred to as?

• The study of abundance

• The theory of scarcity

• The art of decision making

• The science of choice

What is the concept of opportunity cost in economics?

• The value of the next best alternative that is given up when a choice is made

• The value of all alternatives combined

• The value of the chosen alternative

• The value of the least preferred alternative

What is scarcity in economics?

• When resources are unlimited

• When resources are evenly distributed

• When there are not enough resources to satisfy all wants and needs

• When there are too many resources

According to the law of supply, what happens to the quantity supplied as the price of a good or service rises?

• It fluctuates randomly

• It remains constant

• It decreases

• It increases

According to the law of demand, what happens to the quantity demanded as the price of a good or service rises?

• It decreases

• It fluctuates randomly

• It remains constant

• It increases

What is the potential benefit of understanding the basic ideas of economics?

• Reducing the value of opportunity cost

• Creating more demand for goods and services

• Increasing scarcity of resources

• Making better decisions about resource allocation

What is the opportunity cost if a business decides to invest in new technology?

• The value of the chosen alternative

• The value of the next best alternative that is given up

• The value of all alternatives combined

• The potential benefits of hiring more employees

What is the opportunity cost if a student decides to spend their money on a new video game?

• The college tuition that could have been paid for with that money

• The value of the chosen alternative

• The value of the next best alternative that is given up

• The value of all alternatives combined