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| Economics is the study of |
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Definition
| how society manages its scarce resources |
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which of the following statements best represents the principle represented by the adage, "There is no thing as free lunch"? a. Melissa can attend the concert only if she takes her sister with her b. Greg is hungry and homeless c. Brian must repair the tire on his bike before he can ride it to class d. Kendra must decide between going to Colorado or Cancun for spring break. |
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| When society requires that firms reduce pollution, there is |
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Definition
| a trade off because of reduced incomes to the firms' owners and workers |
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Definition
| what you give up to obtain an item |
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Term
| The opportunity cost of an item is |
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Definition
what you give up to get the item |
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Term
| if an economy is producing efficiently, then |
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Definition
| there is no way of producing more of one good with out producing less of another. |
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in a certain economy peanuts and books are produced and the economy currently operates on its production possibilities frontier. Which of the following events would allow the economy to produce more peanuts and more books, relative to the quantities of those goods that are being produced now? a. Unemployed labor is put to work producing peanuts and books b. the economy puts its idle capital to work producing peanuts and books. c. the economy experiences growth. |
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| Microeconomics is best described as the study of |
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Definition
| how households and firms make decesions and how they interact in specific markets. |
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What is the role of an economists? |
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Definition
| In trying to explain the world, economists are scientists. Intrying to change the world they are policey makers. |
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Which of the following is not correct a. trade allows for specialization b. Trade has the potential to benefit all nations c. Trade allows nations to consume outside of their production possibilities curves. d. Absolute advantage is driving force of specialization |
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| if shawn can produce donuts at a lower opportunity cost than sue, then... |
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Definition
| shawn has a comparative advantage in the production of donuts. |
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Term
| absoulute advantage is found by comparing different producers' |
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Definition
| c. input requirements per unity of output |
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Term
| If francis experiences a decrease in his income, we would expect that, as a result, Francis's demand for .... |
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Definition
normal goods will decrease |
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What will happen in the rice market if buyers are expecting higher rice prices in the near future? Hi erin! |
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Definition
| a. the demand for rice will increase |
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| If the number of buyers in the market decreases then the |
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Definition
| market demand will decrease. |
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Term
| Nancy likes pasta today more than she did yesterday. This fact leads us to believe |
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Definition
| nancy is now willing to pay more for pasta than she was yesterday |
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Term
| What would happend to the equilibrium price and quantity of coffee if the wages of coffee-bean pickers fell and the price of tea fell? |
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Definition
| Price will fall and the effect on quantity is ambiguous |
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