Introduction to Economics: Resource Allocation

<p>Public goods are non-excludable and non-rivalrous, making it difficult for private firms to generate revenue from them. (C)</p> Signup and view all the answers

<p>It allows a single economic actor or a small group of actors to manipulate market prices. (D)</p> Signup and view all the answers

<p>Selling factors of production like labor and capital. (C)</p> Signup and view all the answers

<p>Goods and services for revenue. (C)</p> Signup and view all the answers

<p>Firms buy factors of production from households and sell them goods and services. (B)</p> Signup and view all the answers

<p>To enforce contracts and property rights and correct market failures. (C)</p> Signup and view all the answers

<p>Providing unemployment benefits to workers who have lost their jobs. (A)</p> Signup and view all the answers

<p>Imposing strict production quotas on firms, regardless of market demand. (B)</p> Signup and view all the answers

<p>The government should implement policies to reduce the externality. (D)</p> Signup and view all the answers

<p>By promoting competition and preventing unfair pricing practices. (A)</p> Signup and view all the answers

<p>An economist notices a correlation between money supply and price levels, formulates the Quantity Theory of Money, and tests it using historical data. (D)</p> Signup and view all the answers

<p>Scarcity forces societies to make choices about what to produce, how to produce it, and for whom. (A)</p> Signup and view all the answers

<p>Needs are essential for survival, while wants are desires that go beyond basic survival. (D)</p> Signup and view all the answers

<p>Economics focuses on the study of human behavior, while physical sciences study natural phenomena. (C)</p> Signup and view all the answers

<p>A government must decide between allocating funds to improve healthcare or to build new infrastructure, given a limited budget. (D)</p> Signup and view all the answers

<p>Depreciation necessitates the allocation of resources towards rebuilding or reproducing capital, limiting resources for other uses. (B)</p> Signup and view all the answers

<p>Assuming constant V and Y, a central bank doubles the money supply (M). The theory predicts that the price level (P) will also double. (D)</p> Signup and view all the answers

<p>It provides a structured approach to observe economic phenomena, formulate theories, and test them using data, acknowledging inherent uncertainties. (B)</p> Signup and view all the answers

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

<p>It is unattainable with the current level of resources and technology. (A)</p> Signup and view all the answers

<p>Idle resources or inefficiencies in the economy. (C)</p> Signup and view all the answers

<p>It must decrease production of another good. (A)</p> Signup and view all the answers

<p>A decrease in unemployment. (D)</p> Signup and view all the answers

<p>An outward shift of the PPF. (A)</p> Signup and view all the answers

<p>A devastating natural disaster. (C)</p> Signup and view all the answers

<p>The PPF rotates outward, pivoting on the cars axis. (B)</p> Signup and view all the answers

<p>Prices reflect the balance between the value consumers place on a good and the cost incurred by producers to create it. (A)</p> Signup and view all the answers

<p>It suggests that individuals pursuing their self-interest inadvertently promote societal well-being through market interactions. (C)</p> Signup and view all the answers

<p>To transform resources into products, acting as the main units of production. (C)</p> Signup and view all the answers

<p>To act as consuming units, purchasing goods and services from firms. (D)</p> Signup and view all the answers

<p>Resources such as labor, capital, and land. (D)</p> Signup and view all the answers

<p>Because resources are limited while human wants are unlimited. (C)</p> Signup and view all the answers

<p>Society must decide what and how much of each good and service to produce. (D)</p> Signup and view all the answers

<p>Entrepreneurs bear the risks of initiating and developing a business, while managers oversee day-to-day operations. (A)</p> Signup and view all the answers

<p>Because using resources to produce one good means less of another can be produced. (B)</p> Signup and view all the answers

<p>By providing a platform for households to supply savings to firms for investment in capital goods. (A)</p> Signup and view all the answers

<p>The vegetables and social benefits the community garden provided. (C)</p> Signup and view all the answers

<p>To enable the exchange of goods and services between firms and households. (B)</p> Signup and view all the answers

<p>The salary they would have earned from the job, plus tuition, books, and fees. (C)</p> Signup and view all the answers

<p>Choices must be made about which wants to satisfy. (A)</p> Signup and view all the answers

<p>Comparing the estimated increase in revenue to the total cost of the campaign. (C)</p> Signup and view all the answers

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

The study of human behavior including fields like Economics and Psychology.

A systematic approach to observing, hypothesizing, and testing.

The challenge of unlimited human wants vs. scarce resources.

The limited availability of natural resources like fossil fuels.

Basic necessities for survival such as food, shelter, and medical services.

Hypothesis stating P=VM/Y; relates money supply to price levels.

Tangible assets like machinery that can depreciate over time.

The process of enhancing skills and knowledge in individuals.

An economy where multiple buyers and sellers interact, guided by prices.

Adam Smith's idea that individual self-interests lead to beneficial societal outcomes.

Organizations that transform resources into products and services.

An individual who organizes and manages a firm and takes on risks.

The consuming units in an economy that buy goods and services.

Markets where resources like labor and capital are exchanged.

Markets where goods and services are exchanged between producers and consumers.

Markets where factors of production like labor, capital, and land are traded.

The desires for goods and services that improve welfare.

The limitation of resources available to meet unlimited wants.

The challenge of deciding how to distribute limited resources.

Giving up one thing to obtain something else.

The value of the next best alternative foregone when making a decision.

The resources and sacrifices involved in making a choice.

Intellectual growth, better job chances, and higher earnings.

Tuition, books, and lost income from jobs not worked.

A graph depicting the maximum output combinations of an economy.

When an economy is producing at maximum output with available resources.

When an economy produces less than its potential output.

An outward shift of the PPF indicating increased production capacity.

The amount of goods and services produced per hour of labor.

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

Ability of an individual to own and control scarce resources.

Upholds contracts and defends property ownership for safety.

When the market fails to produce desired goods independently.

Impact of one person's actions affecting the well-being of others.

Goods that are not provided by the market due to lack of profit.

A model that illustrates the movement of goods, services, and money in an economy.

To enforce rules, promote efficiency, and ensure equity in a market economy.

The fairness in economic policies in terms of wealth distribution and opportunities.