question

The condition that results from society not having enough resources to produce all the things people would like to have is known as ___________.

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A) capitalism B) scarcity C) free enterprise D) TINSTAAFL Answer is B scarcity

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The resources needed to produce things we would like to have are known in economics as ________.

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A) TINSTAAFL B) factors of production C) financial capital D) gifts of nature Answer is B factors of production

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An example of a capital resource is a(n) _________.

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A) maple tree B) bulldozer C) carpenter D) acre of fertile land Answer is B bulldozer

question

The four key elements to the study of economics are description, analysis, explanation and ________.

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A) prediction B) discovery C) inflation D) communication Answer is A prediction

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Work performed for someone else is known as ______.

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A) consumers B) utility C) service D) specialization Answer is C service

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The fact that some necessities have little monetary worth while some non-necessities have a much higher price tag is called _____.

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A) factor market B) paradox of value C) product market D) productivity Answer is B paradox of value

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In the circular flow model, businesses sell their goods and services in the _____.

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A) factor market B) stock market C) product market D) labor market Answer is C product market

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The curve (frontier) in a production possibilities diagram represents various combinations of goods and/or services that an economy can produce when __________________.

answer

A) food and weapons are the only goods produced B) half of the available resources are employed C) a country has various resources available D) all available productive resources are in full use Answer is D all available productive are in full use

question

A country's production frontier is most likely to move outward after its ___________________.

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A) workers go on strike B) population size grows C) production of a particular good decreases D) production of a particular good increases Answer is B population size grows

question

The term standard of living refers to _______________.

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A) decisions that make a country's economy function B) quality of life in a country C) productivity and economic growth in a country D) role of government in a country's economy Answer is B quality of life in country

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scarcity

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Fundamental economic problem facing all societies that results from a combination of scarce resources and people's virtually unlimited wants.

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Economics

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study of how people and societies use limited resources to satisfy unlimited wants; the management of scarcity and choice

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Need

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Basic requirement for survival.

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Want

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A way of expressing a need

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Factors of Production

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Land,Labor, Capital, Entrepreneurship

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Land

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Any natural resource provided by nature and used in the production process

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Capital

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the tools, equipment, machinery, and factories used in the production of goods and services; also known as Capital Goods

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Financial Capital

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Money used to buy the tools and equipment used in production.

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labor

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Human effort directed toward producing goods and services

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Entrepreneur

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A person who organizes, manages, and takes on the risks of a business.

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production

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process of creating goods and services

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Gross Domestic Product

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The dollar amount of all final goods and services produced within a country's borders in a year; also known as GDP

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Economic Product

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good or service that is useful, relatively scarce, and transferable to others

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Good

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A tangible product used to satisfy human wants

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consumer good

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Finished products that are consumed by an individual.

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capital good

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Buildings, machines, technology, and tools needed to produce goods and services.

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service

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intangible things of value (haircuts, maid service, laundry, education, etc.)

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value

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A customer's subjective assessment of benefits relative to costs in determining the worth of a product

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Paradox of Value

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The situation where some necessities, such as water, have little monetary value, whereas some non-necessities, such as diamonds, have a much higher value.

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utility

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Ability or capacity of a good or service to be useful and give satisfaction to someone.

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wealth

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Accumulation of products that tangible, scarce, useful, and transferable

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market

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a location or other mechanism that allows buyers and sellers to exchange a certain economic product

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factor market

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A market where productive resources are bought and sold

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product market

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A market where producers offer goods and services for sale

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economic growth

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An increase in the total output of an economy

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productivity

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(economics) the ratio of the quantity and quality of units produced to the labor per unit of time

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division of labor

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Division of work into a number of separate tasks to be performed by different workers.

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specialization

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when factors of production performs tasks that they can do relatively more efficiently than others

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human capital

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Sum of peoples' skills, abilities, health, and motivation

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economic interdependence

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Economic activities in one part of the country or world affect what happens elsewhere

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Adam Smith

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"wealth of nations" advocated the idea of laissez faire; or government not involving themselves in the economy.

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Laissez-faire

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Idea that government should not interfere in the economy

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Invisible Hand

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A phrase coined by Adam Smith to describe the process that turns self-directed gain into social and economic benefits for all.

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trade-off

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An alternative that we sacrifice when we make a decision

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opportunity cost

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Cost of the next best alternative use of money, time, or resources when one choice is made rather than another

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production possibilities frontier

answer

A diagram representing various combinations of goods and services an economy can produce when all its resources are in use.

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cost-benefit analysis

answer

A way of thinking about a problem that compares the costs of an action to the benefits received.

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free enterprise economy

answer

One in which consumers and privately owned businesses, rather than the govt, make the majority of the What, How, and For Whom decisions

question

standard of living

answer

Quality of life based on ownership of necessities and luxuries that make life easier.

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