KNUST RE 153: Principles of Economics for Real Estate Lecture Notes
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Questions and Answers

What is the main focus of economics?

  • Determining the quantities of goods and services produced (correct)
  • Deciding for whom goods and services are produced
  • Determining how goods and services are produced
  • Understanding the relationship between self-interest and social interest

    • Which of the following best defines self-interest?

  • Choices made solely based on societal needs
  • Making choices that benefit society as a whole
  • Choices that prioritize the individual's best outcome (correct)
  • Choosing based on the income of others

    • According to Adam Smith, what concept suggests that pursuit of self-interest can benefit social interest?

  • Invisible Hand (correct)
  • Visible Hand
  • Invisible Mind
  • Invisible Foot

    • Why do individuals have to make choices according to the text?

    <p>Due to scarcity</p> Signup and view all the answers

    What does 'social interest' refer to in economics?

    <p>Choices that prioritize society's well-being</p> Signup and view all the answers

    How does self-interest differ from social interest?

    <p>Self-interest benefits individuals, while social interest benefits society</p> Signup and view all the answers

    According to Adam Smith, how did he define economics in his book 'An Inquiry into Nature and Causes of Wealth of Nations'?

    <p>As the practical science of production and distribution of wealth</p> Signup and view all the answers

    What did Lionel Robbins emphasize in his book 'An Essay on the Nature and Significance of Economic Science' in 1932?

    <p>The study of human behavior in relation to resources</p> Signup and view all the answers

    What is Alfred Marshall's definition of economics in his book 'Principles of Economics' (1890)?

    <p>A study of mankind in ordinary business life</p> Signup and view all the answers

    How is economics described as the relationship between ends and scarce means according to Lionel Robbins?

    <p>Ends are human wants, means are resources with alternative uses</p> Signup and view all the answers

    What is the primary focus of studying economics according to the lecture outline?

    <p>The economic problem and why we study economics</p> Signup and view all the answers

    In general terms, how is economics defined by mentioning 'the management of scarce resources'?

    <p>The process through which society deals with limited resources</p> Signup and view all the answers

    In the circular flow model, households are responsible for ________.

    <p>Supplying services of factors of production to firms</p> Signup and view all the answers

    What do factor markets represent in the circular flow model?

    <p>The market where factors of production are bought and sold</p> Signup and view all the answers

    What is the purpose of the production possibilities frontier model?

    <p>To demonstrate the combinations of goods that can be produced with limited resources</p> Signup and view all the answers

    Which assumption is NOT part of the production possibilities frontier model?

    <p>Unlimited technology advancements</p> Signup and view all the answers

    In the circular flow model, what do the orange flows represent?

    <p>Services of factors of production from households to firms</p> Signup and view all the answers

    Which market corresponds to the exchange of goods and services in the circular flow model?

    <p>Goods markets</p> Signup and view all the answers

    What is the key idea that defines the economic way we make choices?

    <p>Making rational choices by comparing benefits and costs</p> Signup and view all the answers

    What is one of the examples of a tradeoff faced by individuals?

    <p>Choosing between studying economics, law, or engineering</p> Signup and view all the answers

    In economics, what is the concept of 'cost' defined as?

    <p>What you must give up to get something</p> Signup and view all the answers

    What is the main idea conveyed by the statement 'There is no such thing as a free lunch'?

    <p>Tradeoffs are necessary in decision-making</p> Signup and view all the answers

    How do people typically make rational choices according to the text?

    <p>By comparing benefits and costs</p> Signup and view all the answers

    What is the scale of preference based on?

    <p>'List of most preferred choices in descending order of satisfaction'</p> Signup and view all the answers

    What is economic growth?

    <p>A sustained expansion of production possibilities</p> Signup and view all the answers

    How does economic growth occur?

    <p>By developing new and better technologies</p> Signup and view all the answers

    What is a method of resource allocation mentioned?

    <p>Market price</p> Signup and view all the answers

    What are consumption goods and services?

    <p>Goods that individuals and governments buy and use in the current period</p> Signup and view all the answers

    What do capital goods do?

    <p>Increase productive resources over future periods</p> Signup and view all the answers

    Why is economic growth not free according to the text?

    <p>Because it requires investment in new technologies</p> Signup and view all the answers

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