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Econ Submissions 1-5
Terms in this set (69)
Societies form economic systems because
To meet the wants and needs of its citizens.
Which of the following is NOT a question an economic system must answer?
When to produce?
In a command economy, decisions are made by
Some central authority
In a traditional economy, decisions are made by
Some designated leader
In a market economy, decisions are made by
The interaction between buyers and sellers
Communism is an example of what type of economic system?
Capitalism is an example of what type of economic system
In evaluating economic systems, it is most important to consider
How well the production questions are answered.
Economic systems must address
Broad social / economic goals.
Economic growth is concerned with
Having more tomorrow
Economic freedom is concerned with
Freedom to choose
Price stability is concerned with
Economic security is concerned with
Full employment is concerned with
Everyone who is willing and able to work has a job
Economic efficiency is concerned with
Greatest production with the least costs
Economic equity is concerned with
The economy of the United States represents a
According to your reading, is a major concern about a command economy
Incentive to work
When resources are not freely or abundantly available, we say they are
Economics is the study of
When we study individual markets or consumers, we are primarily concerned with
When we study the entire economy, we are primarily concerned with
When a statement of fact is made, such as: "The rate of unemployment is currently 5%," this is an example of
When someone explains what should be, such as: "Prices are too high and should be lower", this is an example of
The fundamental economics problem is
We have more wants and needs than we have resources.
When people consider their options, the make their choices based on belief that,
They believe they will be better off
When people make decisions, they take into consideration all available information. However, sometimes choices result in:
An opportunity cost is defined as:
The next best alternative
"There is no such thing as a free lunch." We have heard that many times. Think about opportunity costs in this example:
Your friend wins a pair of tickets to a concert and invites you to go along with her.
Is the concert truly free?
Why is the concert not completely free?
You will have to give up time to go to the concert, which represents your opportunity cost.
A model is:
A simplified representation of something complex
In economics, utility is the measure of:
satisfaction we gain from the consumption of some good or service*
The concept of marginal utility involves:
the additional utility we gain from each successive unit, declines*
As a person consumes more of something, marginal utility:
The value of a good or service is determined by:
choices people make*
When two people agree to make a trade based on the belief that each will be better off, this is called:
Slavery is an example of:
The study of economics is primarily concerned with:
choices people make*
To say that all transactions should be voluntary, this statement involves:
people exchange at their own free choice*
The law of diminishing marginal utility states:
Marginal utility declines where as the total utility increases *
The Production Possibility Curve illustrates:
Point E violates which assumption of the Production Possibility Curve?
Resources are fully employed*
Point F violates which assumption of the Production Possibility Curve?
Both resources and technology are not fixed*
A new innovation in technology results in increased production. What do you predict will happen to the Production Possibility Curve?
It will move outward (to the right)*
Someone who works on a farm represents which factor of production?
Coal used to make steel represents which factor of production?
A scientist that has discovered a new drug represents which factor of production?
A factory represents which factor of production?
Which of the following best illustrates specialization?
A factory that divides production into smaller tasks.
Specialization typically results in people becoming:
A firm that divides production into smaller, more manageable tasks is taking advantage of:
Division of Labor
Division of labor typically results in:
Which 20th century businessman is typically associated with pioneering division of labor?
An example of physical capital would be:
Robot used in a factory.
An example of human capital would be:
An investment in human capital would be represented by:
A college education
The opportunity cost of investing is:
It is important to invest today to improve ______________ tomorrow.
The standard of living.
The standard of living is a measure of:
Amount of goods and services per person.
Transactions made between households and businesses in a market economy are illustrated in which model?
Circular Flow Model
Which economic institution owns the factors of production in a market economy?
Which economic institution in a market economy converts raw materials into finished goods and services?
In the resource market, _______ is purchased by businesses.
Factors of production
In the product market, ______ is purchased by households.
Finished goods and services.
Profits are payment earned from:
Interest is payment earned from:
Wages are payment earned from:
Rent is payment earned for:
In the Circular Flow Model, money flows:
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Econ Submissions 6-10
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