Questions: 1. Human wants are _____________, but resources are not. This creates scarcity.

Scarcity, in turn, forces us to make _____________.

2. __________________ is that which we give up or forgo, when we make a decision or a choice. 3. __________________is the study of how individuals and societies choose to use the scarce

resources that nature and previous generations have provided.

4. Three basic economic questions are (i) ___ _______ (ii) _____ __________ (iii) _____ _____ 5. The basic resources that are available to a society are __

6. The tools, instruments, machines, buildings, and other constructions that are used to produce goods

and services are __

. .

7. The work time and effort that people devote to producing goods and services is _ 8. The human resource that organizes land, labor, and capital is _ 9. The gifts of nature that we use to produce goods and services are __ 10.

. .

_is the branch of economics that examines the behavior of individual decision-making unitsthat is, business firms and households. is the branch of economics that examines the behavior of economic aggregates, for example, income, output, employment etc, on a national scale. _; labor earns __ ___; capital earns _ __; entrepreneurship earns __

11.

12. Land earns _

_. 13. The most fundamental economic problem is A)security. B)scarcity. C)health. D) the fact the your country buys more goods from foreigners than we sell to foreigners. 14. Scarcity requires that people must A)cooperate. B)compete. C)trade. D) make choices.
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15. Which of the following is a microeconomic topic? A)The reasons why Kathy buys less orange juice. B)The reasons for a decline in average prices. C)The cause of why total employment may decrease. D) The effect of the government budget deficit on inflation.
16. When an economy produces more houses and fewer typewriters, it is answering the ____ question.

A)what B)how C)where D) for whom 17. When China builds a dam using few machines and a great deal of labor, it is answering the ____ question. A)what B)how D) for whom C)where
18. Entrepreneurs do all of the following EXCEPT

A)organize labor, land, and capital. B)come up with new ideas about what, how, when and where to produce. C)bear risk from business decisions. D) own all the other resources. 19. The fact that people with higher incomes get to consume more goods and services addresses the ____ question. A)for whom B)when C)where D) how
20. When an action is chosen, the highest-valued alternative NOT chosen is called the

A)implicit cost. B)explicit cost. C)accounting cost. D) opportunity cost.