Economics Test
Name ______________________
Read the word and each definition. Circle the correct letter.
1. producers (a) people who use land and capital to make goods and services (b) the making of goods and services (c) items that can be bought and sold
2. labor (a) resources found in nature, such as soil, minerals, trees, and water (b) the level of consumer interest in a product (c) skills and time contributed by people to the production of good and services
3. goods (a) items that can be bought and sold (b) the level of consumer interest in a product (c) an advantage of competition in the marketplace
4. supply (a) resources made by people such as buildings, tools, and machinery (b) land, labor, and capital (c) the amount of goods available to fill consumer demands
5. land (a) lower prices and higher quality (b) resources found in nature, such as soil, minerals, trees, and water (c) a company or group having exclusive control over a commercial activity
6. consumers (a) exchange one good/service for another (b) the making of goods and services (c) people who purchase goods and services
7. entrepreneurship (a) activities of people who decided what kind of economic activities to pursue (b) production resources (c) land, labor, and capital
Choose the best answer to complete the following questions. Circle the correct letter.
8. An advantage of competition in the marketplace is
(a) lower prices and higher quality
(b) lower quality and higher prices
9. A high demand for a product will cause the price to ______________ for the consumer.
(a) decrease
(b) increase
10. If a story has overstocked an items (high supply), this will cause the price of the item to
(a) decrease
(b) increase
11. A company or group having complete control over a commercial activity (goods & services) is called
(a) a corporation
(b) a monopoly
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