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Economics Final

Terms in this set (52)

What is the formula for determining total costs?
fixed cost + variable cost
What 3 questions does scarcity cause societies to answer?
What to produce
How to produce it
Whom to produce it for
What does the PACED acronym stand for and why is it used?
P- Problem
A-Alternative
C-Criteria
E-Evaluate
D-Design
What is the main problem with using GDP as the only judge of a country's success?
It measures the country as a whole and not the individual people.
Why doesn't GDP include the sale of used goods?
They are created in the previous year and would be apart of that year GDP
What is the primary motivation of a business?
To make money
What is calculated in GDP? (components of GDP)
Consumption, investments, government spending, and net exports combined.
Who decides if businesses succeed or fail in a capitalist economic system?
The consumer
List the 4 factors of production
land, labor, capital, entrepreneurship
List the 4 sectors of the economy
Consumer, business, government, and foreign.
List the 4 components of GDP.
Consumer, business, government, and net exports
What is the difference between exports and net exports?
export-imports= net exports
How does outsourcing and foreign markets impact the circular flow of economic activity in the U.S.?
Outsourcing and foreign market affects the circular flow because the economic flow causes one shutdown or growth of a business to affect things around it.
List the main advantages of using credit.
Can help you make a larger purchase,
Allows you to get loans,
Buy now Pay later,
Track Money
Give 2 ways paying the minimum payment on credit cards is dangerous.
You can end up paying more money in the long run, and
You can have a high interest rate
Why do many people see using credit cards as a problem?
It's borrowed money that you don't have yet
Explain the difference between a checking account and a savings account.
Checking accounts are account you can access often, and savings account is a stash fund that is not something you use until you reach of a goal of your savings.
How could a credit card user avoid paying interest charges?
The best way to avoid paying interest on your credit card is to pay off the balance in full every month.
What are 2 ways to improve a credit score?
Pay on time,
Use a credit card young
What is a debit card?
A debit card is a card that uses money that is already in your account.
Give 2 examples of poor financial decisions when using credit cards
Not paying on time,
Paying the minimum every time
Explain how interest rates and fees impact the price of a product when purchasing items with a credit card.
Interest rates are the additional cost when you use a credit card for the lender. Fees are what you owe so the impact of the price is just adding additional cost.
In economic terms, demand not only refers to simply wanting a good, but what else?
Being able, and willing to pay.
Define substitute and compliments and give an examples of each
Substitute: Can replace one another

Example: Coke and Pepsi
Name 3 factors affecting demand
Wanting something,
Willing to buy it,
Having resources to buy it
Define "supply" in economic terms.
Supply refers to goods and services that people in business are willing to make or do.
What is the law of demand?
The law of demand says that as the price goes up, demand goes down, and vice versa.
What is the law of supply?
The law of supply says that businesses will supply more of a good oro service when the price is high and vice versa.
Moving down along the supply curve would cause what to happen?
Moving down the supply curve would cause the price to increase.
When should you buy stocks?
Buy stocks when they are at a lower Price.
When should you sell stocks?
Sell stocks when they are Higher Price
List 4 things that should be considered when buying stocks.
1. Change in cost of stock over 6 months
2. Recommendation Rating
3.PEG ratio,
4.and Beta
TF: Income taxes are the same standard percentage charged to every citizen no matter how much money you make.
False, based on Income
TF:According to the law of demand, if demand increases, price will decrease.
True, ¨D¨ different.
A tax paid on goods purchased by a consumer is called a property tax
False, it's called Consumption Tax
The job of the IRS is to collect taxes for the U.S. government.
True
False, ¨S¨ same
According to the law of supply, as the price of a good decreases, supply will increase.
Owning stocks is a safe, guaranteed way to make money.
False, not guaranteed
Paying taxes is a requirement for all Americans.
True
In a capitalist society, consumers ultimately decide whether businesses succeed or fail.
True
Credit card companies are non-profit organizations in charge of regulating your spending.
False
Both businesses and individuals are required to pay taxes.
True
Interest rates benefit the lender(person who deposits or loans money.)
True
In a capitalist society, the government is the primary owner of goods and services in the economy.
False
The only way a person can get into debt is by misusing credit cards.
False
Salaries and building rent are examples of fixed costs.
True
Going into debt means that you cannot repay your bills and money you owe.
True
Annual fees are often charged by credit card companies for the privilege of using their services.
True
The U.S. economic system is best described as a free-enterprise communist society.
False
Private property rights refer to one's ability to own their own goods.
True
Exports are goods that leave a country
True
. A credit score is used to determine the quality of a credit card.
False, it's your score from paying off your card
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