Chapter 2
Topics and Content to Review for the Test
Test – Friday, 10/3
**In order to adequately prepare for this test, you should review the following: this study guide, all class
notes, class activities and assignments, and have read chapter 2 in the textbook.
Vocabulary
You should be able to define, explain, and apply (and properly spell!) the following terms.
 Scarcity (and its economic impact)

Factors of Production

Natural Resources

Labor Resources

Capital Resources

Entrepreneurial Resources

Entrepreneurship

Entrepreneur

Economics

Economic Systems

Market Economy

Price

Supply

Demand

Equilibrium Price

Command Economy

Mixed Economy
Complete the chart below in order to explain each of the factors of production:
Factors of
Production

In your own words, explain the difference between renewable and nonrenewable resources. Be
sure to also provide an example of each.

List defining characteristics of a market economy. Give an example country.

List defining characteristics of a command economy. Give an example country.

Record and explain the three basic economic questions that society uses to make economic
decisions.
o
o
o

Draw a rough sketch of a supply and demand graph on the same axis.
o What is the term for the meeting point of the two lines? What purpose does this point
serve?