Economic Quiz Chapter 1,2,3,4 (All answered)
What is Economics? correct answers The study of how peoples need to satisfy their needs and wants by
making choices.
What are the three factors in every Economic scenario correct answers Land, Labor, Capital
What is a trade-off? correct answers All the alternatives that we give up whenever we choose one course
of action over another.
What is a production Possibilites curve/What does it show? correct answers A graph that shows al
alternative ways to use an economy's productive resources. Axes shows different products. example=
shoes and watermelon.
What are the three economic questions. correct answers What goods and services should be produced?
How should these goods and services be produced? Who consumes these goods and services?
Why are the three economic questions important? correct answers Because economic resources are
limited.
What are the tree types of economies. Be able to explain each, advantages and disadvantages, role of
government, entrepreneur. correct answers Market Economy, Command Economy, Traditional Economy.
Market Economy correct answers Based on exchange and trade. The people determine what gets made
and how and who. Called free market(capitalism). People and firms act in their own best interest to
answer the Who, What and How questions.
Command Economy correct answers Government makes all the economic decisions. No one else really
has any controle. North Korea, Russia, Cuba
Traditional Economy correct answers The allocation of scarce resources, and nearly all other economic
activity, stems from ritual, habit or custom. Scarce resources.
What is the law of Demand? correct answers When a good's price is lower, consumers will buy more of it.
When the price is higher, consumers will buy less of it.
What is Economics? correct answers The study of how peoples need to satisfy their needs and wants by
making choices.
What are the three factors in every Economic scenario correct answers Land, Labor, Capital
What is a trade-off? correct answers All the alternatives that we give up whenever we choose one course
of action over another.
What is a production Possibilites curve/What does it show? correct answers A graph that shows al
alternative ways to use an economy's productive resources. Axes shows different products. example=
shoes and watermelon.
What are the three economic questions. correct answers What goods and services should be produced?
How should these goods and services be produced? Who consumes these goods and services?
Why are the three economic questions important? correct answers Because economic resources are
limited.
What are the tree types of economies. Be able to explain each, advantages and disadvantages, role of
government, entrepreneur. correct answers Market Economy, Command Economy, Traditional Economy.
Market Economy correct answers Based on exchange and trade. The people determine what gets made
and how and who. Called free market(capitalism). People and firms act in their own best interest to
answer the Who, What and How questions.
Command Economy correct answers Government makes all the economic decisions. No one else really
has any controle. North Korea, Russia, Cuba
Traditional Economy correct answers The allocation of scarce resources, and nearly all other economic
activity, stems from ritual, habit or custom. Scarce resources.
What is the law of Demand? correct answers When a good's price is lower, consumers will buy more of it.
When the price is higher, consumers will buy less of it.
