Civics Today: Citizenship, Economics, & You

Chapter 18: What Is Economics?

What Is Economics?

1
The fundamental economic problem is __________.
A)how to make money
B)scarcity
C)decision making
D)what type of economy to have
2
Choosing between building a new school or improving a wastewater treatment plant is an example of __________.
A)deciding WHAT to produce
B)deciding HOW to produce
C)deciding FOR WHOM to produce
D)deciding HOW MUCH to produce
3
To study a specific part of the economy, economists use __________.
A)surveys
B)think tanks
C)action/reaction setups
D)economic models
4
Not going to a movie with friends in order to study is an example of __________.
A)cost-benefit analysis
B)opportunity cost
C)macroeconomics
D)microeconomics
5
A mortgage payment is an example of a __________.
A)fixed cost
B)flexible cost
C)variable cost
D)marginal cost
6
The extra cost of producing one additional unit of output is called the __________.
A)unit price
B)variable cost
C)marginal cost
D)output price
7
A cost-benefit analysis is useful in __________.
A)determining the number of employees to hire
B)figuring corporate income taxes
C)creating presentations for the Board of Directors
D)deciding WHAT, HOW, and FOR WHOM to produce
8
A market economy is based on __________.
A)goods and services
B)capitalism and free enterprise
C)traditionalism and command
D)incentives and traditionalism
9
A low interest rate on a credit card is an example of a(n) __________.
A)incentive
B)"stick"
C)marginal benefit
D)free enterprise system
10
One benefit of competition is __________.
A)low prices
B)better decision making
C)marginal benefits
D)a successful democracy
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