Econ Chapter 1 Multiple Choice – Flashcards

Which of the following is NOT a basic economic question? A) WHAT to produce B) WHEN to produce C) FOR WHOM to produce D) HOW to produce

What is the fundamental problem of economics? A) scarcity B) capital C) the factors of production D) labor

Which of the following lists the four factors of production? A) land, labor, wants, entrepreneurs B) land, labor, capital, scarcity C) labor, needs, capital, entrepreneurs D) land, labor, capital, entrepreneurs

Which of the following is NOT a capital good? A) a bulldozer at a construction site B) a cash register at a clothing store C) an oven at a bakery D) a television set for sale at an appliance store

The study of economics includes all of the following EXCEPT A) description B) prediction C) production D) analysis

For something to have value, it must A) cost a lot of money B) have utility C) be on sale D) never go out of style

Which of the following is an example of a service? A) hairspray B) a haircut C) scissors D) a blow dryer

Which of the following is an example of a good? A) a car B) a tune-up C) a car wash D) an oil change

Specialization refers to A) the process of creating goods and services B) the use of the four factors of production C) arranging work so that individual workers do fewer tasks than before D) performing one task relatively more efficiently than another

What is economic interdependence? A) people's reliance on each other to provide goods and services B) the ability to produce all goods and services C) the relationship between the four factors of production D) the result of a division of labor

Which of the following best describes the relationship between trade-offs and opportunity costs? A) opportunity costs are incurred when trade-offs are made B) opportunity costs are the opposite of trade-offs C) trade-offs lower the opportunity costs of an economic decision D) trade-offs occur when there are no opportunity costs

Imagine you decide to purchase a soccer ball for $35. Which of the following is an opportunity cost of your decision? A) the time spent deciding to spend your money B) something else that could have been bought C) $35 cash D) the time spent making the purchase and the tax paid on the ball

Which of the following is NOT a characteristic of a production possibilities frontier? A) it illustrates the concept of opportunity costs B) it is based on full employment of all resources C) it is used by economists as a tool for description analysis D) it indicates the ideal production levels for goods and services

Which of the following is NOT and example of economic decision making? A) writing a thesis B) building simple models C) using cost-benefit analysis D) taking small, incremental steps

The study of economics helps people to A) become better decision makers B) make wise choices for political candidates C) understand the free-enterprise system D) all of the above