Question 1

Which of the following best describes the concept of scarcity in economics?

Accepted Answer

We have unlimited wants, but limited resources to fulfill those wants.

Question 2

What is the opportunity cost of attending a concert if you could have worked at your job earning $50 instead?

Accepted Answer

The $50 you could have earned at your job.

Question 3

Which of the following is an example of a trade-off?

Accepted Answer

Choosing to study for an exam instead of going out with friends.

Question 4

Economics is best defined as:

Accepted Answer

The study of how society manages its scarce resources.

Question 5

Microeconomics focuses on:

Accepted Answer

Choices that individuals and businesses make.

Question 6

Which of the following is NOT typically studied in macroeconomics?

Accepted Answer

How a firm sets the price of its product.

Question 7

If a business decides to use more labor and less machinery, this is an example of:

Accepted Answer

A trade-off in resource allocation.

Question 8

Suppose you spend $20 on a movie ticket and give up a part-time job that would have paid you $30. What is your opportunity cost of going to the movie?

Accepted Answer

$50

Question 9

Which of the following best illustrates the concept of opportunity cost?

Accepted Answer

The value of the next best alternative forgone.

Question 10

Which of the following is a macroeconomic issue?

Accepted Answer

The causes of economic recessions.

Question 11

If the inflation rate increases, which branch of economics would primarily study its effects?

Accepted Answer

Macroeconomics

Question 12

Which of the following statements about scarcity is correct?

Accepted Answer

Scarcity exists because resources are limited and wants are unlimited.

Question 13

A recession is best described as:

Accepted Answer

A period of declining economic activity across the economy.

Question 14

Which of the following is an example of a microeconomic decision?

Accepted Answer

A consumer deciding between buying a laptop or a tablet.

Question 15

If the price of a product increases, what is the likely effect on the quantity demanded, according to microeconomic theory?

Accepted Answer

The quantity demanded will decrease.

Introduction to Economics: Key Concepts and Principles

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