Question

Read the text and answer the question.

Trey works as a server at a local restaurant. Trey is working hard to save up money to buy an old car his uncle is willing to sell him for $1,500. He is the team captain for his school’s basketball team and attends practice after school each day until 5:30 PM. After practice, he works at the restaurant from 6:00 PM to 10:00 PM. Friday nights are usually when servers earn the best tips, but basketball games are scheduled on Friday nights so he cannot work those shifts. If he quit the team it would only take him two months to save up the money but, without working extra shifts, it will take Trey several extra months to save up for the car.

How does scarcity affect Trey?


Time is scarce so Trey must decide whether to buy the car as soon as possible or to keep his position on the team.

Shifts at the restaurant are scarce so Trey must find a second job in order to save up enough to purchase the car.

Positions on the school basketball team are scarce so Trey must quit his job and practice harder to stay on the team.

His uncle’s car is scarce so Trey must purchase the car before demand causes the price of it to rise significantly.

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Question 3 1 pts
Janice decides to produce and sell clothing. She leases retail space at a strip mall from James and renovates her guest bedroom into a sewing room with new sewing machines. She also imports cloth and dye from Thailand to help create some original designs. Janice hires five of her friends to help – Kiera, Sarah, Carlos, Kevin, and Chanice. Kiera and Kevin will sew the new designs while Carlos, Sarah, and Chanice will help run the store. Which factor of production does Janice represent?

land

labor

capital

entrepreneurship

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Question 4 1 pts
Which of these is an example of a capital resource for a construction company?

a supply truck

a skilled worker

a building site

a bank account

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Question 5 1 pts
Read the scenario and answer the question.

Josephine has been teaching for nearly twenty years and is starting to grow tired in the classroom. Her husband is already retired, and with their finances settled, she could retire comfortably when she reaches retirement age in the next few years. In recent years, Josephine has felt that more responsibilities are being given to teachers but they have not been given more time or guidance to accomplish these new tasks. Josephine feels that if teachers were taught better time management skills and goal setting practices, they would be less overwhelmed and ultimately better able to help students. Josephine is considering leaving her job as a teacher to start her own education consulting business to help teachers learn these skills.

What is likely Josephine's primary motivation for becoming an entrepreneur?


Josephine felt she had innovative new teaching methods to share with others.

Josephine felt she could help students most by improving teachers' skills.

Josephine wanted to make more money by selling her ideas to teachers.

Josephine wanted to discourage people from entering the teaching profession.

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Question 6 1 pts
What typically motivates entrepreneurs to improve goods and services or create new ones?

profit

philanthropy

prestige

production

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Question 7 1 pts
Read the text and answer the question.

A shoe company has operated a factory in Singapore for decades. The cost of labor is low in Singapore, and the company keeps its costs low by producing its shoes there even though it sells most of its shoes in the United States. Recent tariffs have caused the company to suffer a loss of profit. Lawmakers from Michigan are looking to revitalize their state's economy and offered the shoe company reduced taxes and other incentives to move their production facilities to Michigan. If the company moves its production to Michigan, its production costs would double.

What is the opportunity cost of moving production from Singapore to Michigan?


the cost of building new production facilities

the cost of the tariffs on the company’s goods

the ability to reduce the company’s tax costs

the ability to produce goods at a lower cost

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Question 8 1 pts
Russell spends an hour studying instead of playing basketball. Russell’s willingness to study is due to the fact that he

must enjoy studying more than he enjoys playing basketball

believes the marginal cost of studying an extra hour is immensely challenging

feels the marginal benefit of an extra hour of studying exceeds the marginal cost of not playing basketball

considers his opportunity cost to be zero

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Answer 1

1. Time is scarce so Trey must decide whether to buy the car as soon as possible or to keep his position on the team

2. Entrepreneurship

3. A supply truck

4. Josephine felt she could help students most by improving teachers' skills

5. Profit

6. The ability to produce goods at a lower price

7. Feels the marginal benefit of an extra hour of studying exceeds the marginal cost of not playing basketball.

Step-by-step explanation:

1. Trey should not take too long to make his decision as time is scarce. If he does, then the price of the car may fluctuate or someone else might end up buying it.

2. Janice is the one who came up with the idea of setting up the business and she is also the risk-taker here. For this reason, she represents entrepreneurship.

3. A supply truck is the capital for a construction company because it is used as an input to deliver the material.

4. Josephine identified the problem that teachers need to be taught better management skills for the sake of students' success.

5. Profit is one of the many major goals of business owners because that amount is used to pay for future business-related needs. It is also important because it keeps the business up and running.

6. Singapore offered lowered rates of production. Although other facilities are better in Michigan the cost of production will increase a lot. Therefore, the ability to produce goods at a lower cost is the opportunity cost.

7. Russel believes that studying extra will make his future bright than playing basketball. Also, the benefits of studying are more than the disadvantages of not playing basketball.