14. Which term would economists use to describe a low initial interest rate on a credit card?
a. obligation
b. incentive
c. voluntary exchange
d. marginal benefit
15. Which of the following best defines informed judgment?
a. choosing the next best alternative when choosing to do one thing rather than
another
b. the attitudes that most people hold about the relationship between the government
and the economy
c. choosing an alternative that has the greatest value from among comparable
products
d. choosing to limit the amount of goods produced in order to increase prices
16. What are the factors of production?
a. natural resources, labor, capital, and money
b. natural resources, capital, goods, and services
c. natural resources, labor, capital, and entrepreneurs
d. natural resources, money, labor, and entrepreneurs
17. Which of the following is an example of a capital good?
a. a box of cereal
b. a pair of shoes
c. a television
d. a hammer
18. Which of the following best defines Gross Domestic Product (GDP)?
a. the total value of any goods and services produced in a single year
b. the total value of all final goods and services produced in a single year
c. the total value of all capital good and services produced in a single year
d. the total value of all labor produced in a single year
19. Capitalism thrives on competition. What is the main benefit of competition?
a. lower prices
b. better decision making
c. a successful democracy
d. marginal costs and benefits