(Review Questions)

Chapter (2)
Question (1): Determine whether the following statements
are true or false:
1- A want is a basic requirement for survival, such as food,
clothing, and shelter.
2- Economic growth occurs when a nation’s total output of
goods and services increases over time regardless inflation
rate or population growth.
3- Economic growth occurs when real GDP per capita
increases over time.
4- For something to have monetary value, economists
decided, it must be scarce and have utility.
5- If a community has many unemployed people, using labor
intensive method of production might be better.
6- In a free market economy, central planning determines
what to produce.
7- In most countries, resources are unlimited and wants are
limited.
8- Opportunity cost is the amount of a good that must be
sacrificed to obtain of other goods.
9- Production efficiency is a situation in which we can produce
more of one good or service without producing less of
something else.
10- Productivity goes up whenever more can be produced with
the same amount of resources.
11- Productivity goes up whenever more output is produced
using the same amount of input.
12- Productivity is the most important factor contributing to
economic growth.
13- Scarcity is the condition that results from society have
enough resources to produce all the things people would
like to have.
14- The difference between a good and a service is that a good
is tangible, or something that can be touched, while a
service is not.
15- A PPB is a schedule or curve illustrating the combinations of
goods that a society is capable of producing at any time if it
employs all of given resources and technology fully and
efficiently.
Question (2): Choose the correct answer:
1- ……………… refers to the “gifts of nature,” or natural
resources not created by people.
a- capital b- technology
c- land d- labor
2- Any good that lasts three years or more when used on a
regular basis is called ………………… .
a- durable good b- free good
c- nondurable good d- none of theses
3- When manufactured goods are used to produce other
goods and services, they are called …………….. .
a- final goods b- consumer goods
c- capital goods d- none of theses
4- ................. arises because society does not have enough
resources to produce all the things people would like to
have.
a- efficiency b- equity
c- scarcity d- elasticity
5- ………………… is the extra usefulness or additional satisfaction
a person gets from acquiring or using one more unit of a
product.
a- total utility b- marginal utility
c- average utility d- none of these
6- ………………. takes place when factors of production perform
only tasks they can do better or more efficiently than
others.
a- globalization b- specialization
c- market equilibrium d- equity
THE ANSWER:

Question (1):

1.× 6. × 11. 
2. × 7. × 12. 
3.  8.  13. ×
4.  9. × 14. 
5.  10.  15. 

Question (2):

1. c
2. a
3. c
4. c
5. b
6. b