Basic Economic Concepts

A. A store has a surplus of unsold items.

B. Everyone can afford as much of everything as they want.

C. A consumer wants to purchase more goods and services than their available income allows.

D. A company decides to donate a portion of its profits to charity.

A. The price of the concert ticket.

B. The price of the ticket plus the value of the time spent at the concert.

C. The enjoyment received from attending the concert.

D. The money spent on snacks at the concert.

A. The cost of the movie ticket.

B. The knowledge you would have gained by studying.

C. The time spent at the movie.

D. All of the above.

A. Land

B. Labor

C. Capital

D. Money

A. The tools and machinery used in production.

B. The skills and knowledge acquired by workers through education and training.

C. The natural resources available for production.

D. The financial resources available to a business.

A. Individual consumers

B. Private businesses

C. The government

D. Market forces of supply and demand

A. Command economy

B. Traditional economy

C. Free-market economy

D. Mixed economy

A. The economy is using all of its resources efficiently.

B. The economy is experiencing economic growth.

C. The economy is not using all of its resources efficiently.

D. The economy has more resources than it can use.

A. The PPC would shift inward.

B. The PPC would shift outward, but only along the axis for good X.

C. The PPC would shift outward along both axes.

D. The PPC would not be affected.

A. Absolute advantage is the ability to produce a good at a lower opportunity cost, while comparative advantage is the ability to produce more of a good with the same resources.

B. Absolute advantage is the ability to produce more of a good with the same resources, while comparative advantage is the ability to produce a good at a lower opportunity cost.

C. Absolute advantage is the ability to produce a good faster, while comparative advantage is the ability to produce a good cheaper.

D. There is no difference between absolute and comparative advantage.