Economics: Scarcity and Tradeoffs

<p>The additional income gained from that extra hour compared to the value of the next best use of that time. (D)</p> Signup and view all the answers

<p>Producing the maximum amount of output with the least amount of inputs. (C)</p> Signup and view all the answers

<p>It can decrease economic efficiency by reducing the incentive to work and produce, which shrinks the overall economic pie. (D)</p> Signup and view all the answers

<p>A student studies for an exam because they want to get a good grade. (B)</p> Signup and view all the answers

<p>Efforts to increase equality often involve tradeoffs that can reduce efficiency. (C)</p> Signup and view all the answers

<p>They are inversely proportional, meaning as one rises the other falls. (C)</p> Signup and view all the answers

<p>The market for goods and services and the market for factors of production. (D)</p> Signup and view all the answers

<p>The PPF demonstrates that there is a tradeoff between producing different goods due to limited resources. (A)</p> Signup and view all the answers

<p>Land, labor, capital, and entrepreneurship. (D)</p> Signup and view all the answers

<p>The opportunity cost of producing one good in terms of the other. (A)</p> Signup and view all the answers

<p>Provides a precise and detailed description of a situation. (B)</p> Signup and view all the answers

<p>The Circular-Flow Diagram emphasizes the exchange of goods and services, while the PPF focuses on the trade-off between producing different goods. (C)</p> Signup and view all the answers

<p>To make complex economic issues simple and understandable. (C)</p> Signup and view all the answers

<p>The quantity supplied increases. (C)</p> Signup and view all the answers

<p>Technological improvements. (B)</p> Signup and view all the answers

<p>To display the relationship between the price of a good and the quantity supplied. (C)</p> Signup and view all the answers

<p>The supply curve shifts to the right. (B)</p> Signup and view all the answers

<p>They hold back supply in anticipation of higher prices. (D)</p> Signup and view all the answers

<p>Resources are specialized for specific purposes. (C)</p> Signup and view all the answers

<p>Any point on the PPF line. (C)</p> Signup and view all the answers

<p>Each good being produced by the individual with the smaller opportunity cost. (B)</p> Signup and view all the answers

<p>The resources spent on producing another good. (C)</p> Signup and view all the answers

<p>They create additional resources for production. (A)</p> Signup and view all the answers

<p>Microeconomics deals with small-scale economic issues. (D)</p> Signup and view all the answers

<p>Economic growth should target sustainable development. (C)</p> Signup and view all the answers

<p>Producing a good using fewer inputs compared to another producer. (C)</p> Signup and view all the answers

<p>Surplus (D)</p> Signup and view all the answers

<p>Change in quantity supplied (D)</p> Signup and view all the answers

<p>It shifts to the right (D)</p> Signup and view all the answers

<p>It decreases (A)</p> Signup and view all the answers

<p>Increase in the price of the good (A)</p> Signup and view all the answers

<p>Decrease in cost of production (B)</p> Signup and view all the answers

<p>Movement downward along the supply curve (D)</p> Signup and view all the answers

<p>Quantity changes but price is indeterminate (D)</p> Signup and view all the answers

<p>Productivity of the workforce (A)</p> Signup and view all the answers

<p>Government intervention in the market (A)</p> Signup and view all the answers

<p>To enforce property rights and ensure a level playing field (A)</p> Signup and view all the answers

<p>They allow countries to focus on producing goods and services they are good at, leading to greater efficiency and lower costs. (D)</p> Signup and view all the answers

<p>A natural force that guides individuals to act in their self-interest, resulting in a beneficial outcome for society. (A)</p> Signup and view all the answers

<p>The forces of supply and demand interacting to determine prices (D)</p> Signup and view all the answers

<p>Reduced dependence on domestic production (D)</p> Signup and view all the answers

<p>People make logical decisions based on the potential costs and benefits of different choices. (B)</p> Signup and view all the answers

The limited nature of society’s resources.

The study of how society manages its scarce resources.

All decisions involve tradeoffs between alternatives.

Efficiency maximizes resource use, equality distributes prosperity uniformly.

The cost of something is what you give up to get it.

Incremental adjustments to an existing plan.

Make decisions by evaluating costs and benefits systematically.

Something that induces a person to act.

Specializing in a good or service allows for exchange, improving well-being for all.

An economic system where resources are allocated through buyers and sellers' interactions.

A theory by Adam Smith stating that self-interested actions can benefit society.

The maximum price a buyer is willing to pay for a good or service.

When a market does not allocate resources efficiently, resulting in loss of economic well-being.

When production or consumption of a good affects third parties not directly involved.

The amount of goods and services produced per unit of labor; key to higher living standards.

An overall increase in the general level of prices in an economy.

Society experiences a tradeoff between inflation and unemployment in the short run.

A model showing how dollars move between households and firms through markets.

Resources used to produce goods and services: labor, land, capital, entrepreneurship.

A graph showing the maximum combinations of two goods that can be produced with available resources.

The cost of forgoing the next best alternative when one option is chosen over another.

The PPF can be straight or bow-shaped, reflecting varying opportunity costs as resources shift.

Where firms buy inputs (labor, land, capital) from households to produce goods and services.

Production Possibility Frontier shows the maximum output combinations of two goods.

A PPF that indicates different resources and opportunity costs for goods.

Production points on the PPF line, meaning resources are fully utilized.

Points below the PPF line indicate wasted resources.

Points above the PPF line cannot be achieved with current resources.

Ability to produce a good at a lower opportunity cost than others.

Ability to produce more of a good with the same resources than another producer.

The trade-off of what you give up to obtain something else, calculated for each option.

The claim that the quantity supplied of a good rises when the price rises, indicating a direct relationship.

A table showing the relationship between the price of a good and the quantity supplied.

The costs of production inputs like wages and raw materials; lower input prices increase supply.

Technological advances reduce input requirements, increasing the quantity supplied at each price.

When sellers adjust supply based on anticipated future price changes, which can shift the supply curve.

The point where quantity supplied equals quantity demanded.

When quantity supplied is greater than quantity demanded, leading to excess supply.

When quantity demanded exceeds quantity supplied, causing excess demand.

Occurs when a non-price factor (like technology or costs) changes, affecting supply.

Changes in quantity supplied due to price changes along a fixed supply curve.

A shift occurs due to changes in non-price factors like income or number of buyers.

Occurs when price changes, affecting quantity demanded on a fixed demand curve.

Shifts in curves affect equilibrium price and quantity; direction matters.