Economics Policy Criteria and Questions Quiz

How did the growth of railroads and improvement in transportation change the U.S. banking systems in the nineteenth century?

The growth of railroads and improvement in transportation led to the expansion of markets, increased trade, and the need for more sophisticated banking services to facilitate transactions.

What effect would a tax on carbon have on emissions?

A tax on carbon would increase the cost of emitting carbon, leading to a decrease in emissions as firms seek to reduce their tax burden.

Will increasing the minimum wage decrease employment opportunities?

Increasing the minimum wage may lead to a trade-off where some jobs are lost due to higher labor costs, but it can also stimulate consumer demand and boost the economy.

How do we explain price wars in the airline industry?

Price wars in the airline industry can be attributed to factors such as excess capacity, competition for market share, and attempts to drive out rivals. Signup and view all the answers

Does concern about the environment change our views of free trade?

Concerns about the environment can lead to calls for environmental regulations or tariffs on goods produced in ways that harm the environment, potentially impacting free trade agreements. Signup and view all the answers

Why is corruption more widespread in some countries than in others?

Corruption can be more widespread in countries with weak institutions, lack of transparency, low accountability, and where there are high levels of discretion in decision-making. Signup and view all the answers

What are the four specific criteria used most often in economics for making judgments?

The four specific criteria are efficiency, equity, growth, and stability. Signup and view all the answers

What is the difference between positive and normative economics?

Positive economics attempts to understand behavior and the operation of economies, while normative economics deals with value judgments about what the economy should be like. Signup and view all the answers

Define 'opportunity cost' in economics.

Opportunity cost refers to the value of the next best alternative that must be forgone in order to pursue a different option. Signup and view all the answers

What is 'marginalism' in economics?

Marginalism is the study of marginal (additional) changes in the benefits and costs of a specific choice. Signup and view all the answers

What is meant by an 'efficient market' in economics?

An efficient market is one where asset prices reflect all available information and resources are allocated optimally. Signup and view all the answers

What major event is referred to as the 'Industrial Revolution'?

The Industrial Revolution was a period of major industrialization and technological advancement that began in Britain in the late 18th century. Signup and view all the answers

What is the concept of opportunity cost in economics?

Opportunity cost is the best alternative that we forgo or give up when we make a choice or decision. Signup and view all the answers

Define marginalism in economics.

Marginalism is the process of analyzing the additional or incremental costs or benefits arising from a choice or decision. Signup and view all the answers

What are the three fundamental concepts in economics that can change the way you look at everyday choices?

The three fundamental concepts are opportunity cost, marginalism, and the working of efficient markets. Signup and view all the answers

Why is it important to study economics?

Studying economics helps in learning a way of thinking, understanding society, and being an informed citizen. Signup and view all the answers

What is the outcome of thousands of individual decisions in an economy?

The outcome is what happens in the economy, driven by individual opportunity costs and choices. Signup and view all the answers

Why do nearly all decisions involve trade-offs in economics?

Nearly all decisions involve trade-offs because people have limited resources and must make choices on how to allocate them. Signup and view all the answers