Podcast
Questions and Answers
Jim's behavior illustrates which economic principle?
Jim's behavior illustrates which economic principle?
- People respond to economic incentives (correct)
- Opportunity cost
- Supply and demand
- Scarcity
__________ goods and services are those bought by businesses to be used to increase efficiency or enhance production.
__________ goods and services are those bought by businesses to be used to increase efficiency or enhance production.
Capital
What type of economy is the United States best classified as?
What type of economy is the United States best classified as?
Mixed economy
What are the resources provided by nature and used to produce goods and services known as?
What are the resources provided by nature and used to produce goods and services known as?
Which of the following is not a possible opportunity cost of attending college?
Which of the following is not a possible opportunity cost of attending college?
What is one of the first steps in deciding whether to complete your education?
What is one of the first steps in deciding whether to complete your education?
Economics is the study of choice under conditions of?
Economics is the study of choice under conditions of?
Macroeconomics is concerned with all of the following except:
Macroeconomics is concerned with all of the following except:
Tangible products like cars and televisions are referred to as __________.
Tangible products like cars and televisions are referred to as __________.
When should an individual or firm continue any activity?
When should an individual or firm continue any activity?
Which of the following countries has an economy largely guided by a central planning authority?
Which of the following countries has an economy largely guided by a central planning authority?
The principle of opportunity cost evolves from the concept of?
The principle of opportunity cost evolves from the concept of?
In what type of economy does the government decide how economic resources will be allocated?
In what type of economy does the government decide how economic resources will be allocated?
Which of the following is a positive economic statement?
Which of the following is a positive economic statement?
The stock of computers, factory buildings, and machine tools used to produce goods is known as?
The stock of computers, factory buildings, and machine tools used to produce goods is known as?
What key economic question do we try to answer when deciding on a production method?
What key economic question do we try to answer when deciding on a production method?
What is the name given to the development of a new good?
What is the name given to the development of a new good?
Economics is concerned with how people respond to?
Economics is concerned with how people respond to?
When thinking of an arrangement that brings buyers and sellers together, what are you thinking of?
When thinking of an arrangement that brings buyers and sellers together, what are you thinking of?
According to the rationality assumption, people do not intentionally make decisions that would leave them?
According to the rationality assumption, people do not intentionally make decisions that would leave them?
Macroeconomics can be used to understand all the topics below, except:
Macroeconomics can be used to understand all the topics below, except:
What happens when the federal government creates environmental policies that make it cheaper for firms to follow green initiatives?
What happens when the federal government creates environmental policies that make it cheaper for firms to follow green initiatives?
What is the study of the choices people make to attain their goals, given their scarce resources?
What is the study of the choices people make to attain their goals, given their scarce resources?
Economists use the word marginal to mean an extra or additional benefit or cost of a decision. An optimal decision occurs when
Economists use the word marginal to mean an extra or additional benefit or cost of a decision. An optimal decision occurs when
A market is a group of _______ and _______ of a good or service and the institution of arrangement by which they come together to trade.
A market is a group of _______ and _______ of a good or service and the institution of arrangement by which they come together to trade.
Is the pricing decision of Microsoft charging $599 for Windows 7 rational?
Is the pricing decision of Microsoft charging $599 for Windows 7 rational?
What unavoidable fact comes from a reality economists call scarcity?
What unavoidable fact comes from a reality economists call scarcity?
What is a centrally planned economy?
What is a centrally planned economy?
What is a market economy?
What is a market economy?
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Study Notes
Economic Principles and Incentives
- Individuals respond to economic incentives; for instance, Jim chose to participate in a paid health study.
- Marginal analysis involves weighing the additional benefits and costs of decisions, critical for educational choices.
Types of Goods and Services
- Capital goods are utilized by businesses to enhance efficiency and production.
- Tangible products like cars and televisions are termed "goods."
Economic Classifications
- The U.S. economy is classified as a mixed economy, combining elements of both market and planned economies.
- North Korea represents an economy with resource allocation primarily determined by a central planning authority.
Fundamental Economic Concepts
- Natural resources are the raw materials provided by nature for producing goods and services.
- Opportunity cost arises from scarcity and represents the next best alternative foregone when making a choice.
Economic Decisions and Market Structures
- CEntrally planned economies have the government decide on resource allocations.
- A market is defined as a system where buyers and sellers interact to trade goods or services.
Macroeconomics and Economic Statements
- Macroeconomics differentiates between various broad topics, excluding consumer choices in specific product purchases.
- Positive economic statements, like the correlation between minimum wage and unemployment, are objective and testable.
Economic Models and Rationality
- People generally act rationally, avoiding decisions that would intentionally leave them worse off.
- Physical capital includes tangible assets like computers and machinery used in production processes.
Policy Implications and Environmental Economics
- Economic policies encouraging green initiatives align with market incentives, reducing operational costs for firms.
The Study of Economics
- Economics explores how individuals make choices to meet goals with limited resources, focusing on responding to incentives and managing scarcity.
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