1.Which of the following makes trade-offs necessary? (2 points)

Diminishing marginal returns

Diminishing marginal utility

Limited resources and unlimited wants and needs

Different opportunity costs

An excess of supply

2.Why might a food item such as bread not necessarily be a consumer good in all economic scenarios? (2 points)

Food products are scarce.

It could be sold to a government employee.

It could be an ingredient in a consumer good that is sold by a business.

Acquiring one food item involves not acquiring another item that could have been purchased instead.

Since food is consumed it is always a consumer good.

3.The government of country X owns the means of production, determines incomes and investment, and decides what goods should be produced and how they should be traded. What economic system does Country X have? (2 points)

Command

Capitalist

Entrepreneurial

Free Enterprise

Mixed

4.The government of Country Y does not regulate businesses in any way. It does not set minimum prices for any goods or regulate wages. It allows individuals to make independent decisions that impact the economy. What economic system best describes Country Y? (2 points)

Command

Free enterprise

Market

Mixed

Indeterminate

5.Production at a level that is not maximizing available inputs can be illustrated through a (2 points)

circular flow diagram

supply curve

demand curve

marginal cost curve

production possibility curve

6.Use the graph to answer the prompt. (2 points)

B O' Product 1 O' E D Product 2Good A Good BUnits of Cheese in a Day Fish in a Day Steven 10 25 Matthew 30 10Production Level Bags of Beans Bags of Rice A 60 O B 57 1 53 N 49 W E 42 4 F 30 G 25 6 H 0Miniature Powdered Donuts Consumed Total utility (utils) 12 2 20 3 26 4 29 5 28 6 25Units of Books Marginal Utility of Books Units of Coffee Marginal Utility of Coffee 1 16 1 2 6 14 2 3 5 12 3 4 4 10 4 5 3 8 5 6 N 6 6 HNumber of Handfuls Total Benefit (dollars) $2.00 2 $3.50 3 $4.50 4 $5.00 $5.25 6 $5.00 7 $4.00