| A | B |
|---|
| People make _____ about how to use limited resources, decide the ownership of resources, and structure markets for the distribution of goods and services. | choices |
| What is the inability to satisfy all wants at the same time where all resources and goods are limited and it requires that choices be made? | scarcity |
| What are factors of production that are used in the production of goods and services? Some types are natural, human, capital, and entrepreneurship. | resources |
| What is selecting an item or action from a set of possible alternatives? | choice |
| What is given up when a choice is made – the highest valued alternative given up? | opportunity cost |
| What is the amount of money exchanged for a good or service? | price |
| What are things that incite or motivate and are used to change economic behavior? | incentives |
| What determines price? | interaction of supply and demand |
| What is the using of goods and services? | consumption |
| What is the combining of human, natural, capital and entrepreneurship resources to make goods or provide services? | production |
| Name the 4 types of resources. | human, natural, capital, entrepreneurship |
| Why must individuals choose/make decisions about desired goods and services? | because goods and services are limited |
| What does price determine? | who gets the goods and services |
| What is the amount of a good or service that consumers are willing and able to buy at a certain cost? | demand |
| What 2 things determine what is produced? | resources available and consumer preference |
| What must individuals consider when making a choice? | value of what is given up |
| What is the amount of a good or service that producers are willing and able to sell at a certain price? | supply |
| What 2 things determine what is purchased? | consumer preference and price |
| What is the key factor in determining the type of economy a country has? | extent of government involvement |
| What are the 3 basic questions every economy must answer? | what to produce, who will produce it, for whom will it be produced |
| Name the 4 basic types of economies. | market, command, traditional, mixed |
| What are 3 basic characteristics of a command economy? | central (government) ownership of resources, centrally planned economy, lack of consumer choice |
| What are 5 basic characteristics of a free market economy? | private ownership of resources, profit motive, competition, consumer sovereignty, individual choice |
| Which economy characterizes the United States? | mixed |
| Which economy makes decisions based on custom and historical precedence? | traditional |
| What are 3 basic characteristics of a mixed economy? | individuals make decisions in private sector, government makes decisions in the public sector, most common form of economy in the world today |
| Name the 5 characteristics of the United States economy. | free markets, private property, profit, competition, consumer sovereignty |
| Name the economy where markets are allowed to operate without undue government interference. | market |
| When does government intervene in a market economy? | when the benefits of government policy outweigh the costs |
