Economics Unit 1 TestBank

Select the items below that describe the field of economics. Is a social science Is a plan to buy everything Focuses on decision making Involves consumers and producers

-is a social science -focuses on decision making -involves consumers and producers

water and food are examples of _____.

needs

extra pairs of shoes and music downloads are examples of _____.

wants

Select the items below that are kinds of services. Going to the doctor Getting a haircut Mowing the lawn Owning a house

-going to the doctor -getting a haircut -mowing the lawn

Susan bought a new computer. She purchased a _____.

good.

people who buy goods and services are part of a group of decision makers called ______.

consumers.

Select the items that name types of producers. Buyers Companies Governments Nonprofit organizations

-companies -governments -nonprofit organizations

public education and roads are produced by ________.

governments

Match the term with the appropriate definition. 1. analysis 2. benefit 3. cost 4. maximize

(2) what is gained when a decision is made (1) in-depth study (4) to receive the most from something (3) what is given up when a decision is made.

Select the two parts of rational behavior. Doing whatever a person wants Receiving the most satisfaction from a decision Working within given conditions Not analyzing decision options

-receiving the most satisfaction from a decision. -working within given conditions.

Ben wants to buy a new cell phone. Select the conditions that Ben should consider for this buying decision. The price of the cell phone Ben's age The number of sisters and brothers Ben has The amount of money Ben has to spend

-the price of the cell phone -the amount of money Ben has to spend

a cost-benefit analysis is a way _______.

to make a decision using a rational approach

Select the steps for a cost-benefit analysis. List the costs involved in making a decision. Compare the costs and benefits. List the benefits involved in making a decision. Make a decision based on maximizing satisfaction.

all

Match the term with the appropriate definition. 1. capital goods 2. human resources 3. natural resources 4. productive resources

(2) quantity and quality of human effort to achieve a goal (3) factors from the environment used to achieve a goal (1) products made to make other products and services (4) factors used to achieve a goal.

Trees and sunlight are examples of ________.

renewable resources.

Sergio likes to drive and thinks that gas will be around forever. What is the problem with Sergio's thinking?

Gas is a nonrenewable resource.

People design computers, and machines assemble them. Gas is then used to transport the finished computers to stores. Select the factors used in producing computers. Health Natural resources Human resources Capital goods

-natural resources -human resources -capital goods

Select the items that describe nonrenewable resources. Limited amounts Last forever Include fossil fuels (e.g., coal) and minerals (e.g., gold) Come from Earth

-limited amounts -include fossil fuels (e.g., coal) and minerals (e.g., gold) -come from earth

America has primarily ______ ______ aggregate economical behavior.

consumer-driven

An example of a physiological need is ______.

food

resources that will eventually run out are ______.

scarce

scarcity exists because resources are limited, but people's wants are ______.

unlimited.

Only $35.99/year

Select all that apply. Which of the following describe the effects of scarcity? Businesses can only make a limited number of goods and services. People have limited wants. Not everyone's needs are met. Using scarce resources today means having fewer tomorrow.

-businesses can only make a limited number of goods and services. -not everyone's needs are met. -using scarce resource today means having fewer tomorrow.

to have more resources in the future, we must _______ resources today.

conserve

You had fifty gallons of water and decided to use twenty-five gallons for showering, brushing your teeth, and flushing the toilet. You also decided to use the rest for cleaning dishes and washing your car. This division refers to your water _____ .

distribution

Select all that apply. Which of the following items determine your preference for a concert ticket? band that is playing date of the concert price of the ticket friends that are going

all

a positive incentive that makes people better off is a ______.

reward

receiving a penalty from an action will most likely result in ______.

not doing the action often.

Charlotte paid $4 for a movie download. The monetary amount is the download's ______.

retail price

Ben was considering spending his gift card on books, music downloads, or movie tickets. He chose the movie tickets. Any values given up from not choosing the books and music downloads are called _____ .

trade-offs

Any value given up from the best alternative is called the _____ .

opportunity cost

Select all that apply. Select all the items that describe incentives. depend on the individual affect how people behave are not part of the decision process help to determine the choices of an individual

-depend on the individual -affect how people behave -help to determine the choices of an individual

Only $35.99/year

An economic term that describes happiness and is hard to measure in numbers is _____ .

utility

The cost of producing a good and getting it to the customers is called

accounting cost

Beyonce, Taylor Swift, and Miley Cyrus make commercials that encourage people to drink milk. These ads contain _____ .

endorsements

George and Martha both have the choice to go to the movies. George decides to go, while Martha decides to stay home. The example illustrates _____ .

individual preferences

Steven puts aside some of his money for future use. He is a ______.

saver

You studied for an exam and received an "A." The "A" is an example of a _____ .

non-monetary incentive

Joyce is thinking about spending Saturday night at the movies, although she has many other choices for how to spend her Saturday night. Her choices represent her _____ .

alternatives

________ is an incentive in conserving both renewable and non-renewable resources.

private property

Select all that apply. Identify the fallacious arguments. The Great Depression brought prosperity to a few and great poverty to the many. The Civil War was about Northern businessmen trying to bankrupt Southern farmers by emancipating their enslaved workforce. The Civil Rights movement in America brought much needed recognition to the rampant discrimination throughout America. England developed a fair and just taxation system for the American Colonies. The U.S. involvement in the Vietnam War was a rousing success.

-The civil War was about Northern businessmen trying to bankrupt Southern farmers by emancipating their enslaved workforce. -England developed a fair and just taxation system for the American Colonies

Select all that apply. What do economic systems seek to do? provide basic care to citizens help countries respond to the issue of scarcity protect industry from competition answer the three key economic questions

-help countries respond to the issue of scarcity -answer the three key economic questions.

Only $35.99/year

You own a restaurant and are responsible for organizing your business's productive resources. You are a(n) _____

entrepreneur

A company can use its resources to make shirts, towels, or sheets. It chooses to make shirts. Any value given up from not choosing to make the towels or sheets is the _____ .

trade-off

Your company needs to fix some of the machines in its factory. It also needs to buy more materials. But the company has to choose between these options, because money _____ .

is limited

Choices are really about trading off the__________ value of one option against the alternatives

expected

The government uses its resources to provide different public goods. This shows that _____ .

productive resources can be used in different ways.

Sometimes, things happen that offset the initial effect of a decision. These things are kinds of _____ .

unintended consequences

The extra amount of satisfaction that you receive from an additional slice of pizza is part of the _____ .

marginal benefit

A business calculated that the expense to produce an additional unit of its product is $10. This amount is the

marginal cost

The additional unit of happiness that you receive from a decision is called the _____ .

marginal utility

The law of diminishing marginal utility says that as you consume more of something, the satisfaction that you get from each additional unit _____ .

decreases

Only $35.99/year

Employees from Bob's Car Factory figured out that making another car would cost $25,000. The business also sells each car for $20,000. The company is better off _____ .

not producing the extra car.

Jackie is doing a marginal analysis to decide if she should spend any more money on a movie download. After figuring out her marginal cost and marginal benefit, she will _____ .

decide which one is greater.

externalities are ________ effects

spillover

Distribution systems _____ .

cannot satisfy everyone's wants

Sue-Ellen took Charlie's cell phone without his permission because she wanted it. This is an example of distribution by _____ .

force

Kevin is selected to receive a free meal because he is the tallest person in the restaurant. This meal was distributed by using the _________ method.

personal characteristics

Rose brought in cupcakes for her birthday and gave one to each person in the class. This is an example of the ___________ distribution method.

sharing

Free market economies offer distribution methods for goods and services based on _____ .

price

Free market economies distribute goods and services __________ than command economies.

in a different way

Select all that apply. Select all the items that describe command economies. limited freedom for consumers inefficient use of productive resources usually not much economic growth encourages competition between businesses

-limited freedom for consumers -inefficient use of productive resources -usually not much economic growth

Select all that apply. A primary incentive for entrepreneurs is _____. profit a skilled and happy workforce notoriety seeing an idea come into being paying taxes

-profit -a skilled and happy workforce -seeing an idea come into being

Match these items. Match the items in the left column to the items in the right column. 1. allocate 2. benefit 3. consumer 4. cost 5. economics 6. entrepreneur 7. good

(1) distribute (7) objects that can satisfy people's needs or wants (3) person whose needs and wants are satisfied by using goods and services (5) social science that focuses on decision-making (2) what is gained when decision is made (6) someone who organizes productive resources to make goods and services (4) what is given up when a decision is made.

Select all that apply. Select all the items that can be used to make goods and services. renewable resources nonrenewable resources human resources capital goods

all

Receiving a penalty from an action will most likely result in doing _____ .

less of the action

You are better off consuming or producing an additional good or service if _____ .

the marginal benefit is greater than the marginal cost

Majority rule, first-come/first-served, and sharing equally are examples of _____ .

non-market distribution methods

Free-market economies allocate resources and distribute goods and services mostly based on _____ .

price