Economy Basics

Scarcity can best be defined as

• Scarcity can best be defined as

• Where demand is greater than supply

• Unlimited wants vs Limited resources

• Limited wants vs unlimited resources

The major types of resources used to make a product are called

• natural resources

• factors of reduction

• factors of production

• capital resources

They can spend it on a vacation to the Grand Canyon or build a swimming pool in their back yard.  They decide to spend the money on a swimming pool.

 What is the opportunity cost of their decision?

• vacation

• swimming pool

When I choose one item over another because I cant afford both, this is called an ...

• scarcity

• opportunity cost

• choice

• incentive

What is the fundamental problem of economics?

• How to keep consumers out of debt?

• How to fulfill our unlimited wants and needs with limited resources?

• How to figure out the way to make the most money?

• How do we ensure all people get a college education?

________ are decisions we all must make due to scarcity.

• trade offs

• scarcity

• choice

• incentive

Laissez-faire means.....

• the government should control the economy

• the government should buy all goods

• the government should have a "hands off approach" to the economy

• the government should be abolished

What is the primary function of money in an economy?

• Medium of exchange

• Store of value

• Unit of account

• All of the above

Which of the following is considered a factor of production?

• Money

• Labor

• Technology

• Government

What does GDP stand for in economic terms?

• Gross Domestic Product

• General Domestic Product

• Gross Development Product

• General Development Product