Personal Finance Section 1 Study Questions

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Section 1 Study Questions (9.0 points) Answer each question fully. Complete sentences are not necessary. Lesson 1 (3.0 points) 1. Name at least two things financial planning could help you do. (0.5 points) Create a budget. Save and invest money. 2. What is trade? (0.5 points) The exchange of things of value. 3. What is a service? (0.5 points) Something of value that a person can do for other people. 4. Name one of the three functions of money. (0.5 points) Store of value. 5. The real estate market is categorized in which way? (0.5 points) By commodity 6. What is a country’s GDP? (0.5 points) The value of the goods and services produced in that country. Lesson 2 (3.0 points) 1. What is a market economy? (0.5 points) An economic system that is regulated by the interactions between producers and consumers in the market. 2. Name at least two features of capitalism. (1.0 points) Create competition with other companies. Help the market grow into new areas. 3. A business that sells watches that are more inexpensive than the watches a competitor sells is using which type of competition? (0.5 points) Price competition. 4. What is a monopoly? (0.5 points) When one company controls an entire area of goods or services, so that customers don’t have other choices. 5. What is a motive? (0.5 points) A reason for doing something. Lesson 3 (3.0 points) 1. What is land as a factor of production? (0.5 points) Forces that combine to make the production of goods and services possible. 2. What does the Law of Demand say? (0.5 points) If all other factors are equal, the demand will go down if the price goes up, and the demand will go up if the prices go down. 3. What does the Law of Supply say? (0.5 points) If all other factors are equal, the supply will increase if the price

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