Chapter 1 – Flashcards with Answers

question

The ___________ cost of an activity takes account not only of required money outlay but also the value of the time you spend on the activity.
answer

opportunity
question

The opportunity cost of your time can be roughly estimated using your _______.
answer

wage
question

POSITIVE or NEGATIVE economic analysis involves objective statements that can be disproven using data.
answer

POSITIVE
question

POSITIVE or NEGATIVE economic analysis may include subjective and ethical judgments and makes recommendations on the best decision to achieve a given end.
answer

NEGATIVE
question

study of how agents choose to allocate scarce resources and the impact of those choices on society.
answer

economics
question

Microeconomics studies​ _________, while macroeconomics studies​ _________.
answer

a small piece of the overall​ economy; the economy as a whole
question

The three principles of economics include​ ____________, ______________, and ______________
answer

optimization, equilibrium, and empiricism
question

OPTIMIZATION, EQUILIBRIUM, or EMPIRICISM describes a situation where people weigh costs and benefits when making a decision
answer

OPTIMIZATION
question

OPTIMIZATION, EQUILIBRIUM, or EMPIRICISM describes a situation where no one would benefit from changing his or her behavior
answer

EQUILIBRIUM
question

OPTIMIZATION, EQUILIBRIUM, or EMPIRICISM describes a situation where economists use data to analyze what is happening in the world
answer

EMPIRICISM
question

During the process of optimization economists believe that people are considering​ the ___________ of a​ choice, given the ______________ available at the time
answer

feasibility; information
question

The goal of optimization for an individual is to maximize overall ____-_______
answer

well-being
question

The opportunity cost of an activity is a measure of what is GIVEN UP or GAINED when you do that activity
answer

GIVEN UP
question

For a market to be in​ equilibrium, three conditions must hold: The amount produced by sellers must be EQUAL or MORE to the amount purchased by buyers; The costs of making a product must be EQUAL or LESS than the final price at which the product sells; Buyers must place a value on the uses of the product that is LESS THAN or GREATER THAN the cost of buying the product.
answer

EQUAL; LESS THAN; GREATER THAN
question

______________ describes how one event can bring about change in another.
answer

causation

Get instant access to
all materials

Become a Member