LESSON 1

1.An economic system based on individuals looking out for their own and their families' best interest is known as a (an) _______________.

A. growth economy

B. command economy

C. market economy

D. efficient economy

2.Microeconomics is the study of________.

A. the economy as a whole

B. a subset of the economy

C. all activity in a nation that affects production, distribution and use of goods and services

D. economic theory

3.Imagine you are an entrepreneur who has just opened a business. Your output is below your potential. You have plenty of land to build on and money to invest into developing the land to suit your needs. Which of the following would best help bring you to maximum output?

A. Hire more workers.

B. Sell some of the land for money to invest in technology.

C. Hire more workers and sell some land for money to invest in technology.

D. Lay off workers and invest in technology.

4.Read the following scenario:

It takes Mike 60 minutes to vacuum a room, and Debbie 45 minutes.

It takes Mike 30 minutes to wash dishes, and Debbie 45 minutes.

What is Mike's opportunity cost of vacuuming in terms of washing dishes?

A. 30 minutes

B. 60 minutes

C. 45 minutes

D. 1 hour 45 minutes

5.Manufactured goods used to make other goods and services are called ________.

A. technology

B. opportunity costs

C. trade-offs

D. capital

6.Economists test their hypotheses by ___________.

A. evaluating them using their personal opinions on the matter

B. gathering data and developing conclusions

C. making generalizations until the hypothesis makes sense

D. consulting with other economists with different values

7.What does a production possibilities curve show?

A. The minimum combination of two goods or services that can be produced given the supply of factors of production.

B. The maximum combination of two goods or services that can be produced given the supply of factors of production.

C. The exchange of two goods or services that can be exchanged given the supply of the factors of production.

D. The tradeoff that occurs between two goods or services that can be produced given the supply of factors of production.

8.Imagine you are the production manager at a candy factory. Your company sells mostly chocolate. One of your products is very popular during the holidays. A few weeks prior to each holiday, you adjust production goals to produce more holiday candy and less of everything else. What is this an example of?

A. Supply and demand

B. tradeoff

C. Needs vs. wants

D. Scarcity and production

9.If you owned a successful business which consistently produced at maximum production, which of the following would best help you expand your production?

A. Allow workers to work overtime.

B. Procure more factors of production.

C. Buy more land in which to build more production facilities.

D. Apply for a loan to buy more land.

10,The basic problem addressed by economics is________.

A. deciding when to invest in technology

B. having limited resources

C. dealing with shortages of land and labor

D. evaluating if decisions are good or bad

LESSON 2

1.Choose the correct answer.

Capital resources are ___________ and ____________ needed to produce goods and services.

A. the property; money

B. money;minerals

C. the property;minerals

D. skills; educational qualifications

2.Which one of the following are activities that are performed for a fee?

A. Services

B. Goods

C. Both the goods and services

D. Neither goods nor services

3.Which one of the following is a natural resource?

A. Dams

B. Wind

C. Bridges

D. Trains

4.Choose the correct answer.

Barter is a trade using only ____________.

A. only goods

B. only services

C. money

D. goods and services

5.Which of the following is a natural resource?

A. Car

B. Plants

C. Sunlight

C. Both plants and sunlight

6.Who provides a good or service?

A. Consumer

B. Government

C. Producer

D. None of the choices

7.Under which category you would fall into if you worked as a waiter?

A. Natural resource

B. Capital resource

C. Human resource

D. Not a resource

8.Which form of an economy answers the four basic economic questions based on habits and customs?

A. Market economy

B. Command economy

C. Traditional economy

D. Both command and the traditional economy

9.Choose the correct answer.

Consumers buy fewer items that are __________.

A. low in cost

B. high in cost

C. high in quality

D. high in style

10.What would you be called if you buy a car?

A. Consumer

B. Individual

C. Producer

D. Trader