55 terms

Economics Unit 1

STUDY
PLAY

Terms in this set (...)

Choosing to buy something instead of something else is an example of..
Trade-off
Marginal Cost
The expense of producing one additional unit
If the total cost of producing an order of computers is $10,000, and a company produces 500 computers per order, what is the average cost of a computer?
$20
What drives production?
Scarcity
An example of a human resource.
knowledge
An example of a want.
cars, vacation, jewelry
Give an example of HOW to produce.
Regulating the amount of pollution factories produce
What does a benefit-cost analysis compare?
Marginal costs and Marginal benefits
Mrs. Martin the founder of Kalena's Jewelry would be an example of which factor of production?
Entrepreneurship
Marginal Revenue
The extra income that results from selling one more unit of the output is
If the fixed costs of producing shoes is $1,000 and the variable costs are $500 then the total cost is
$1,500
Which economy allows specialization based on individual choice?
Market Economy
Which factor has the MOST influence on the quantity supplied?
Cost of producing the product
Which factor of production is a fisherman?
Labor
Which factor of production is a farm?
Natural Resource
Which economy does not value progress?
Traditional Economy
If economic decisions are made by a central authority it is which type of economy?
Command Economy
A building would be an example of what factor of production
Capital
The demand for goods and services in a particular area would probably increase if
all units in a new apartment building in the area were rented to families
Which factor is likely to cause the supply of a product to decrease
A decrease in consumer demand
A demand curve shifts to the left when...
consumers are willing to buy fewer items at all possible prices
Name the characteristics of a market economy
people have the freedom to choose from a variety of products
The loss of our years of income resulting from the decision to go to college is an
opportunity cost
If the variable costs of producing two books are $200, what is the marginal cost of producing one more book?
$100
total cost
fixed expenses + variable expenses
Market economy
Individuals and businesses own all resources and basic economic decisions on price
Marginal Cost
Increase in expenses, caused by producing another unit of something
Traditional Economy
Decisions of what, how, and for whom to produce are based on customs
Mixed market economy
Private ownership and some government involvement exist in a price-based system
Economic system
A nation's way of producing the things people need and want
Variable Cost
Expenses that change depending on how much a business produces
Command Economy
The government makes all the major economic decisions
Opportunity Cost
Cost of the next-best use of money or time when you choose one action or another
Fixed Cost
Expenses that do not change no matter how much a business produces
Capital
Buildings, tools, equipment that manufacture goods
Revenue
Money a business receives from selling its goods or services
Supply Curve
Slopes upward to the right
Demand Curve
Slopes downward to the right
Amount supplied by producers is greater than the amount demanded by consumers
Surplus
Equilibrium Price
Demand and supply are balanced in the market
Marginal Revenue
Additional income received from each increase of one unit in sales
Benefit-Cost Analysis
Way of comparing gains to expenses
Shortage
Quantity demanded is greater than the quantity supplied
Wants
Desires that can be met by getting a product or service
Demand
Amount of a good that people are willing and able to buy at various prices
Producers
People or businesses that provide goods and services
Giving up one alternative good or service for another
Trade-off
Market
Place where buyers and sellers make voluntary exchanges
Consumers
People who BUY goods and services
Supply
Amount of a good that producers are willing and able to sell at various prices
Competition
Struggle among sellers at attract buyers
Economics
STUDY of how people and nations use limited resources to satisfy unlimited wants
Not having enough resources to satisfy all wants
Scarcity
Something that can be used in making products or services.
Resource
ESSAY: Identify and explain three reasons why the Market Economy is better able to create wealth and prosperity?
Answers will vary
YOU MIGHT ALSO LIKE...
STUDY GUIDE