Economics Basics Practice
1. How does scarcity affect producers? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review scarcity in Scarcity and Choice.
Unselected answer (0 pts) Limited costs prevent producers from hiking prices.
Unselected answer (0 pts) Limited demand prevents producers from offering low prices.
Unselected answer (0 pts) Limited time prevents producers from finding the best employees.
Correct answer (1 pt) Limited resources prevent producers from making unlimited products.
1 /1 point
2. Which statement best explains the relationship between economic wants and needs? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review economic wants and needs in Scarcity and Choice.
Unselected answer (0 pts) People do not need to fulfill either their needs or their wants to survive.
Unselected answer (0 pts) People must fulfill their wants to survive, but they do not need to fulfill their needs to survive.
Correct answer (1 pt) People must fulfill their needs to survive, but they do not need to fulfill their wants to survive.
Unselected answer (0 pts) People must fulfill both their needs and their wants to survive.
1 /1 point
3. Which statement describes how governments deal with scarcity? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review economic decision making in Economic Decision Making.
Unselected answer (0 pts) choosing to fill needs rather than wants
Unselected answer (0 pts) choosing options that best match supply with demand
Unselected answer (0 pts) choosing options that employ the largest number of people
Correct answer (1 pt) choosing options with the greatest benefits to the people
1 /1 point
4. Which situation is more likely to occur in a command economy than a market economy? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review market and command economies in Distributing Goods and Services.
Unselected answer (0 pts) A factory lays off unneeded workers.
Unselected answer (0 pts) A farm sells fruit by the side of the road.
Unselected answer (0 pts) A union negotiates a better pay rate with employers.
Correct answer (1 pt) A failing railroad receives assistance from around the country.
1 /1 point
5. Which of these states a basic economic question? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review the three basic economic questions in Distributing Goods and Services.
Unselected answer (0 pts) What job is the best?
Unselected answer (0 pts) How much should this good cost?
Correct answer (1 pt) What goods should be produced?
Unselected answer (0 pts) Why should people learn about economics?
1 /1 point
6. Which of these is an example of a non-monetary incentive? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review types of incentives in Incentives.
Unselected answer (0 pts) earning payment for walking a neighbor's dog
Correct answer (1 pt) being named on the school honor roll
Unselected answer (0 pts) getting $10.00 as a prize for finishing first
Unselected answer (0 pts) winning a scholarship to attend a summer camp
1 /1 point
7. What is a tariff? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review free trade and trade barriers in Trade.
Unselected answer (0 pts) a tax on exports
Correct answer (1 pt) a tax on imports
Unselected answer (0 pts) a bonus to producers
Unselected answer (0 pts) a rebate for consumers
1 /1 point
8. How are producers different from consumers? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review producers and consumers in Specialization.
Unselected answer (0 pts) Producers want to buy products from consumers.
Unselected answer (0 pts) Producers want low demand for goods.
Unselected answer (0 pts) Producers want high costs of resources.
Correct answer (1 pt) Producers want a high quantity of sales.
1 /1 point
9. Which is true of relative prices? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review market, relative, and equilibrium prices in Market and Prices.
Unselected answer (0 pts) They are prices set by buyers and sellers.
Correct answer (1 pt) They describe prices in relation to each other.
Unselected answer (0 pts) They tell where the supply of a good meets its demand.
Unselected answer (0 pts) They help avoid shortages and surpluses.
1 /1 point
10. When do the laws of supply and demand have less effect on prices? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review demand and supply in Role of Prices.
Unselected answer (0 pts) when a good or service is new
Unselected answer (0 pts) when outside factors cause changes
Correct answer (1 pt) when buyers search for substitutes
Unselected answer (0 pts) when sellers want to make more money
1 /1 point
11. Which factor of a market economy helps people feel safe when making business investments? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review the market economy in Competition in Markets.
Correct answer (1 pt) strong property rights
Unselected answer (0 pts) freedom of enterprise
Unselected answer (0 pts) consumer choice
Unselected answer (0 pts) limited role of government
1 /1 point
12. Which problem would most likely result if banks did not exist? (1 point)
Review Guidelines:
If you guessed the answer to this question, or did not answer it correctly, go back and review the function of banks in Economic Institutions.
Unselected answer (0 pts) People would no longer be able to save money.
Correct answer (1 pt) Money would not move through the economy very well.
Unselected answer (0 pts) Spending money would become much more difficult.
Unselected answer (0 pts) Buyers and sellers would no longer use money in markets.
1 answer