Civics-Economics Test Review Test Date 4/22/08 60 Questions/180 Points.
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Transcript of Civics-Economics Test Review Test Date 4/22/08 60 Questions/180 Points.
Civics-EconomicsCivics-Economics
Test ReviewTest Review
Test Date 4/22/08Test Date 4/22/08
60 Questions/180 Points60 Questions/180 Points
The Basic Economic The Basic Economic ProblemProblem
ScarcityScarcity All resources are scarce so all goods and All resources are scarce so all goods and
services are scarce.services are scarce.
Needs v. WantsNeeds v. Wants
Needs are things that you have to have Needs are things that you have to have for survival.for survival.
A want is anything else.A want is anything else.
Goods v. ServicesGoods v. Services
Goods are physical and tangible objects. Goods are physical and tangible objects. Services are actions or activities that a Services are actions or activities that a
person performs for another. person performs for another.
Factors of ProductionFactors of Production
LandLand LaborLabor CapitalCapital
Three Basic Economic Three Basic Economic QuestionsQuestions
What to produce?What to produce? How to produce?How to produce? For whom to produce?For whom to produce?
Opportunity CostOpportunity Cost
The most desirable alternative to a The most desirable alternative to a chosen activity.chosen activity.
Production possibilities graphProduction possibilities graph EfficiencyEfficiency UnderutilizationUnderutilization Guns or Butter DecisionGuns or Butter Decision
EntrepreneurEntrepreneur
Risk-taker that starts a business.Risk-taker that starts a business.
Adam SmithAdam Smith
Laissez-FaireLaissez-Faire Wealth of NationsWealth of Nations
Economic SystemsEconomic Systems
TraditionalTraditional CommandCommand MarketMarket MixedMixed
Law of DemandLaw of Demand
Consumers will buy more goods and Consumers will buy more goods and services at lower prices.services at lower prices.
Law of SupplyLaw of Supply
Producers will be willing to produce more Producers will be willing to produce more when they can charge higher prices.when they can charge higher prices.
EquilibriumEquilibrium
Price where supply and demand are Price where supply and demand are equal (no shortage or surplus)equal (no shortage or surplus)
DisequilibriumDisequilibrium
Price where supply and demand are not Price where supply and demand are not equal (creates a surplus or a shortage)equal (creates a surplus or a shortage)
Business OrganizationsBusiness Organizations
Sole Proprietorship Sole Proprietorship PartnershipPartnership Corporations (stock/dividends)Corporations (stock/dividends)
You should know the percentage each You should know the percentage each organization represents as well as the organization represents as well as the advantages and disadvantages.advantages and disadvantages.
Corporate MergersCorporate Mergers
HorizontalHorizontal Vertical Vertical ConglomerateConglomerate
InflationInflation
What is it?What is it? Demand-pullDemand-pull Cost-pushCost-push CPI and market basketCPI and market basket
Gross Domestic ProductGross Domestic Product
What does it measure?What does it measure? ExportExport ImportImport
UnemploymentUnemployment
StructuralStructural FrictionalFrictional SeasonalSeasonal CyclicalCyclical
UnderemploymentUnderemployment
Business CycleBusiness Cycle
What is it?What is it? ExpansionaryExpansionary PeakPeak ContractionaryContractionary TroughTrough What happens to GDP and unemployment What happens to GDP and unemployment
during each phase?during each phase? RecessionRecession StagflationStagflation
Monetary PolicyMonetary Policy
What is it?What is it? Expansionary PurposeExpansionary Purpose Expansionary ToolsExpansionary Tools Contractionary PurposeContractionary Purpose Contractionary ToolsContractionary Tools
Fiscal PolicyFiscal Policy
What is it?What is it? Expansionary PurposeExpansionary Purpose Expansionary ToolsExpansionary Tools Contractionary PurposeContractionary Purpose Contractionary ToolsContractionary Tools