Unit 1 Test- Part 1

Economics is the study of

• How individuals and society make choices based on scarce resources

• How to run a business most profitably

• How to predict inflation, unemployment, and stock prices

• How the government can stop the harm of individual and business self-interest

Scarcity refers to

• everything having a cost

• people weighing the costs and benefits of their choices

• unlimited wants in a world of limited resources

• mo' money, mo' problems

What scarcity-related choice must the owner of this calendar make?

• how to conduct meetings

• how to best use their time

• what to say on conference calls

• what to say about campaign targets

What is the definition of 'needs' in economics?

• Desires for non-essential items

• Essential requirements for survival

• Luxury items

• Optional goods

Define opportunity cost.

• The value of the next best alternative given up

• The total cost of all alternatives

• The benefit received from a decision

• The process of evaluating options

What is the role of entrepreneurs in the economy?

• To innovate and create businesses

• To consume goods and services

• To provide labor

• To regulate markets

What are 'factors of production'?

• Elements used to produce goods and services

• Finished products

• Consumer goods

• Financial assets

Which of the following is an example of a land resource that a person who owns a restaurant would need?

• the servers who wait on customers

• the farmer who grows the vegetables served at the restaurant

• the water used to for drinking and cleaning

• the loan taken out to purchase the restaurant

What are the two types of capital?

• Physical and human

• Financial and natural

• Tangible and intangible

• Liquid and fixed

What are the benefits of waking up early to study?

• More time for morning activities

• Increased alertness in the evening

• Better alignment with societal schedules

• More time for late-night activities