Podcast
Questions and Answers
What are goods?
What are goods?
- Methods used to encourage people to take certain actions
- Work that one person performs for another for payment
- The alternative you give up when you make an economic choice
- Physical objects that can be purchased (correct)
What is cost-benefit analysis?
What is cost-benefit analysis?
- Methods used to encourage people to take certain actions
- The value of something that is given up to get something else that is wanted
- The alternative you give up when you make an economic choice
- An approach that weighs the benefits of an action against its costs (correct)
What is opportunity cost?
What is opportunity cost?
- The alternative you give up when you make an economic choice
- Methods used to encourage people to take certain actions
- An approach that weighs the benefits of an action against its costs
- The value of something that is given up to get something else that is wanted (correct)
What is trade off?
What is trade off?
Which economic system involves the government owning some of the factors of production?
Which economic system involves the government owning some of the factors of production?
Which economic system involves individuals owning the factors of production?
Which economic system involves individuals owning the factors of production?
Which economic system answers the basic economic questions according to tradition?
Which economic system answers the basic economic questions according to tradition?
What do economic goals provide?
What do economic goals provide?
True or false: Scarcity refers to a situation where there are more resources than human wants.
True or false: Scarcity refers to a situation where there are more resources than human wants.
True or false: In a pure command economic system, the individual has significant influence over how the economic questions are answered.
True or false: In a pure command economic system, the individual has significant influence over how the economic questions are answered.
True or false: In a mixed economic system, elements of both the market and command systems are present.
True or false: In a mixed economic system, elements of both the market and command systems are present.
What are goods?
What are goods?
What is trade off?
What is trade off?
Which economic system involves the government owning some of the factors of production?
Which economic system involves the government owning some of the factors of production?
Which economic system answers the basic economic questions according to tradition?
Which economic system answers the basic economic questions according to tradition?
Which economic system involves individuals owning the factors of production?
Which economic system involves individuals owning the factors of production?
What do economic goals provide?
What do economic goals provide?
Which economist is known as the father of economics?
Which economist is known as the father of economics?
Which of the following is NOT one of the three types of economic systems mentioned in the text?
Which of the following is NOT one of the three types of economic systems mentioned in the text?
In a traditional economy, how are goods and services produced and distributed?
In a traditional economy, how are goods and services produced and distributed?
Which economic system is characterized by individual choice and voluntary exchange directing economic decisions?
Which economic system is characterized by individual choice and voluntary exchange directing economic decisions?
Which of the following is an advantage of a market economy?
Which of the following is an advantage of a market economy?
What is a disadvantage of a pure market economy?
What is a disadvantage of a pure market economy?
What type of economic system does the United States have?
What type of economic system does the United States have?
What does the term 'global economy' refer to?
What does the term 'global economy' refer to?
What is a centrally planned economy?
What is a centrally planned economy?
What role does the government play in a command economy?
What role does the government play in a command economy?
What are the disadvantages of a command economy?
What are the disadvantages of a command economy?
Which of the following best defines economics?
Which of the following best defines economics?
What is the definition of scarcity?
What is the definition of scarcity?
What are wants?
What are wants?
According to the text, what are the three basic economic questions that every society must address?
According to the text, what are the three basic economic questions that every society must address?
According to the text, how do countries and individuals determine 'what will be produced'?
According to the text, how do countries and individuals determine 'what will be produced'?
According to the text, what are the four factors of production and their definitions?
According to the text, what are the four factors of production and their definitions?
Which of the following best defines marginal cost?
Which of the following best defines marginal cost?
Which of the following best defines marginal benefit?
Which of the following best defines marginal benefit?
What does the production possibilities curve (PPC) illustrate?
What does the production possibilities curve (PPC) illustrate?
What does the law of increasing opportunity costs state?
What does the law of increasing opportunity costs state?
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Study Notes
Basic Economic Concepts
- Goods are products or services that satisfy human wants
- Cost-benefit analysis is a method of comparing the advantages (benefits) and disadvantages (costs) of a decision
- Opportunity cost is the value of the next best alternative given up when choosing one option over another
- Trade-off is the sacrifice of one thing in order to obtain another
Economic Systems
- Command economy: the government owns some of the factors of production
- Market economy: individuals own the factors of production
- Traditional economy: answers the basic economic questions according to tradition
- Mixed economy: combines elements of both market and command systems
Economic Goals and Scarcity
- Economic goals provide a framework for making decisions about how to allocate resources
- Scarcity refers to a situation where there are limited resources and unlimited human wants
- Wants are unlimited desires for goods and services
Traditional Economy
- Goods and services are produced and distributed based on tradition and custom
Market Economy
- Characterized by individual choice and voluntary exchange directing economic decisions
- Advantage: promotes efficiency and innovation
- Disadvantage: can lead to income inequality
Command Economy
- Government plays a central role in allocating resources and making decisions
- Disadvantages: lack of incentives, innovation, and individual freedom
Global Economy and Economics
- Global economy refers to the economic system that encompasses all countries and their economic activities
- Economics is the study of how individuals, businesses, governments, and societies allocate resources to meet their unlimited wants and needs
- The three basic economic questions that every society must address are: what to produce, how to produce, and for whom to produce
Production Possibilities Curve (PPC)
- Illustrates the various combinations of two goods that can be produced given the available resources and technology
- Law of increasing opportunity costs states that as the production of one good increases, the opportunity cost of producing that good also increases
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