Understanding Economic Principles and Factors

What is the economic principle that describes the limited nature of society's resources?

• Abundance

• Scarcity

• Surplus

• Inflation

Which of the following is NOT a type of government?

• Democracy

• Oligarchy

• Communism

• Capitalism

Which type of economy is characterized by private ownership and free markets?

• Command economy

• Mixed economy

• Market economy

• Traditional economy

In which market structure do many firms sell products that are similar but not identical?

• Perfect competition

• Monopoly

• Oligopoly

• Monopolistic competition

Who introduced the concept of the "Invisible Hand" in economics?

• Karl Marx

• John Maynard Keynes

• Adam Smith

• Milton Friedman

Which of the following is an environmental factor that can affect economic activity?

• Interest rates

• Climate change

• Tax policies

• Labor laws

What is the term for the cost of the next best alternative foregone when making a decision?

• Sunk cost

• Opportunity cost

• Fixed cost

• Variable cost

Which of the following is considered a factor of production?

• Labor

• Inflation

• Currency

• Tariffs

What is the term for the machinery, tools, and buildings humans use to produce goods and services?

• Labor

• Capital

• Land

• Entrepreneurship

Which of the following is a characteristic of perfect competition?

• Few sellers

• Unique products

• Price takers

• High barriers to entry