Economics Study Guide s1

Name ______Economics Study Guide The student will recognize that because people and regions cannot produce everything they want, they specialize in producing some things and trade for the rest. The student will identify examples of making an economic choice and will explain the idea of opportunity cost (what is given up when making a choice).

Directions: Fold study guide in half. Ask the question on the left. Check by turning the page over to look at the answers on the back. (This guide can be used alone or with a partner.)

*Please remember this is a guide and the test may ask questions that are not on this guide.*

Questions Answers 1. What are goods? 1. Things people make or use to satisfy their needs and wants are goods.

2. What are services? 2. Activities that satisfy needs and wants are services.

3. What is a consumer? 3. A consumer is a person who uses goods or services.

4. What is a producer? 4. A producer is a person who makes goods or provides services.

5. Can people have everything that they 5. No, people cannot have everything want? that they want. They must make choices.

6. What is opportunity cost? 6. What you give up to get what you want is the opportunity cost. (The item you give up.) 7. What does it mean when a good is 7. Scarcity is when there are not scarce? enough of the things you want. (Goods run out.) 8. What is opportunity cost? 8. The next best choice is called the opportunity cost. 9. Give an example of money. 9. Money can be paper bills, checks, or coins. 10. What is a synonym for barter? 10. Two synonyms for barter are trade (Remember a synonym is a word that means the same or exchange. thing.) 11. Why do people save money? 11. People save money so that they may buy something in the future.

By Tammy Horton pleasefeedtheanimals.blogspot.com Copyright 2013 Questions Answers 12. Name four natural resources. 12. Natural resources include water, soil, wood, and coal. 13. Name four human resources. 13. Human resources include teachers, painters, farmers, and waitresses. 14. Name four capital resources. 14. Capital resources include computers, pencils, hammers, and vehicles (cars, truckes, etc.). 15. What is specialization? 15. Specialization is when people focus on a product or service. (Examples: Teachers specialize in educating children. Painters specialize in painting houses.) 16. Why do people who specialize have to 16. People need other goods or services depend on others? that they cannot produce on their own. 17. What is an economic choice? 17. An economic choice is when you choose between products or services that you need or want. 18. What is supply and demand? 18. Products (goods) are made depending on the need or wants of the consumers (people).