Econ Chapter 1 Quiz

goods and services market

households receive goods and services and pay firms for them

the circular flow diagram of economic activity is a model of the:

flow of goods, services, and payments between households and firms

specialization

can lead to an increase in overall production

the basic difference between macroeconomics and microeconomics is:

micro concentrates on the behavior of individual consumers and firms while macro focuses on the performance of the entire economy

which of the following is most likely a topic in discussion in macro?

a decrease in the unemployment rate

in a market-oriented economy, the amount of a good that is produced primarily decided by the interaction of:

buyers and sellers

labor market

households work and receive payment from firms

which of the following is most likely a topic of discussion in microeconomics?

an increase in labor cost will increase the additional cost of producing another bus

market oriented economy

most economic decisions about what to produce, how to produce it, and for whom to produce it are made by buyers and sellers

command economy

the government either makes most economic decisions itself or at least strongly influences how the decisions are made