ECONOMICS - UNIT 1 ECONOMICS
FUNDAMENTALS QUIZ WITH CORRECT
QUESTIONS AND ANSWERS [GRADED A+]
economics - 1. the study of how individuals and nations make choices about ways to use
scarce resources to fulfill their needs and wants
2. Social science that deals with the study of the production, consumption, distribution of goods
and services and the transfer of wealth to obtain those goods and services.
scarcity - a situation in which unlimited wants exceed the limited resources available to
fulfill those wants
trade-offs - giving up one thing in favor of another
©caleb 2024/2025. Published 2025
,opportunity costs - the highest-valued alternative that must be forgone when a choice is
made
rational decisions - choice in which you weigh the costs and benefits of each option
marginal benefit - the additional satisfaction or benefit received when one more unit is
produced
marginal cost - the cost of producing one more unit of a good.
marginal benefit-marginal cost analysis - Rational decision making involves marginal
benefits that equal or exceed the marginal costs
resources - anything that is used to produce goods or services
allocation of resources - decision on how to divide scarce resources among different uses
goods - tangible products that we use to satisfy our wants and needs
©caleb 2024/2025. Published 2025
, services - actions or activities that one person performs for another
factors of production - land, labor, capital, entrepreneurship
capital goods - Buildings, machines, technology, and tools needed to produce goods and
services.
human capital - the skills and knowledge gained by a worker through education and
experience
producers - individuals and organizations that determine what products and services will
be available for sale.
consumers - people who buy goods and services
entrepreneur - (n.) a person who starts up and takes on the risk of a business
©caleb 2024/2025. Published 2025
FUNDAMENTALS QUIZ WITH CORRECT
QUESTIONS AND ANSWERS [GRADED A+]
economics - 1. the study of how individuals and nations make choices about ways to use
scarce resources to fulfill their needs and wants
2. Social science that deals with the study of the production, consumption, distribution of goods
and services and the transfer of wealth to obtain those goods and services.
scarcity - a situation in which unlimited wants exceed the limited resources available to
fulfill those wants
trade-offs - giving up one thing in favor of another
©caleb 2024/2025. Published 2025
,opportunity costs - the highest-valued alternative that must be forgone when a choice is
made
rational decisions - choice in which you weigh the costs and benefits of each option
marginal benefit - the additional satisfaction or benefit received when one more unit is
produced
marginal cost - the cost of producing one more unit of a good.
marginal benefit-marginal cost analysis - Rational decision making involves marginal
benefits that equal or exceed the marginal costs
resources - anything that is used to produce goods or services
allocation of resources - decision on how to divide scarce resources among different uses
goods - tangible products that we use to satisfy our wants and needs
©caleb 2024/2025. Published 2025
, services - actions or activities that one person performs for another
factors of production - land, labor, capital, entrepreneurship
capital goods - Buildings, machines, technology, and tools needed to produce goods and
services.
human capital - the skills and knowledge gained by a worker through education and
experience
producers - individuals and organizations that determine what products and services will
be available for sale.
consumers - people who buy goods and services
entrepreneur - (n.) a person who starts up and takes on the risk of a business
©caleb 2024/2025. Published 2025
