C1 Quiz (C) – Flashcards
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People are rational
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When economists develop models designed to explain the choices people make, they generally assume that
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in centrally planned economics by the government in market economics by the decisions of households and firms interacting in markets (Both a and b are true)
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What goods and services will be produces, how do the goods and services will be produced, and who will receive the goods and services are determined:
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use all available information to achieve their goals, respond to incentives, and make decisions by comparing marginal benefits with marginal costs.
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Economics assumes people and firms
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should not
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Given the changes to Medicare, if the marginal benefit of offering an additional bed is $1,000 and the marginal cost is $9,000 per bed, then the corporation __________________ offer additional beds
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One, what goods and services will be produced? Two, how will the goods and services be produces? Three, who will receive the goods and services produces?
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Trade-offs force society to make choices, particularly when answering the following three fundamental questions:
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Productive efficiency Allocative efficiency
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_________ occurs when a good or service is produces at the lowest possible cost. __________ occurs when production is in accordance with customer preferences.
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One, what goods and services will be produces? Two, how will the goods and services be produces? Three, who will receive the goods and services produced?
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Trade-offs force society to make choices, particularly when answering the question three fundamental questions:
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How income is distributed
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In the United States, who receives the goods and services produced depends largely on __________
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Mixed
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A __________ economy is an economy in which most economic decisions result from the interaction of buyers and sellers in markets but in which the government plays a significant role in the allocation of resources.
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The highest value alternative that must be given up to engage in an activity.
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Opportunity cost is
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Macroeconomics
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Which of the following covers the study of topics such as inflation or unemployment?
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The fail distribution of economic benefits
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Equity is
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Many times in the past several decades, firms may have chosen between a production method in the United States that uses fewer workers and more machines and a production method in China that uses more workers and fewer machines.
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Firms choose how to produce the goods and services they sell. In many cases, firms face a trade-off between using more workers or using more machines. For example,
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Scarcity
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One of the basic facts of life is that people must make choices as they try to attain their goals. This unavoidable fact comes from a reality an economist calls
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Centrally Planned Market
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Societies organize their economies in two main was to answer the three questions of what, how and who. A society can have a __________ economy in which the government decides how economic resources will be allocated. Or a society can have __________ economy in which the decisions of households and firms interacting in markets allocate economic resources.
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firm interaction.
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Microeconomics is most likely to include the study of
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Simplified versions of reality designed to analyze "what is" to explain human decision making in any context.
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Economic models are:
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the policies are consistent with economic incentives.
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When federal government crafts environmental policies that make it less expensive for firms to follow green initiatives,
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When we assume the managers at Microsoft have used all available information and have weighed all known benefits and costs, we are assuming rationality.
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Microsoft charges a price of %599 for a copy of Windows 7. Is this pricing decision rational?
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unemployment
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Macroeconomics is most likely to include the study of
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Are rational, respond to incentives, and make all-or-nothing decisions.
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Economics assume people and firms:
