Econ 40 HW Ch 1 – Flashcards
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1. Oil that needs to be extracted for the production of gasoline
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Natural resources
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The physical strength one develops through weight training
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Human capital
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A musical instrument used by a professional band
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Physical Capital
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2. The problem of scarcity
Suppose that the hypothetical country of Kernaland suffers a chronic scarcity of its staple grain, corn.
True or False: The country of Kernaland must be a developing country, since scarcity is not a problem in developed countries.
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False
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3. Based on this model, households earn income when______
purchase_________ in the resource markets.
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firms->resources
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Megan spends $9 to order a mojito cocktail.
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Product Markets
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Larry spends $175 to purchase necklace from Classy's Jewelry Store.
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Product Markets
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Larry earns $200 per week working for Little Havana.
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Resource Markets
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Which of the elements of this scenario represent a flow from a household to a firm? This could be a flow of dollars, inputs, or outputs. Check all that apply.
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-The $175 Larry spends to purchase necklace from Classy's Jewelry Store
-The $200 per week Larry earns working for Little Havana
-The mojito Megan receives
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4. A decision at the margin
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Time/Total Problems Answered
8:00 AM 0
9:00 AM 40
10:00 AM 70
11:00 AM 90
Noon 100
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The effect of a cigarette tax on the quantity of cigarettes sold
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Microeconomics
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The government's decision on how much to spend on public projects
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Macroeconomics
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A consumer's optimal choice when buying a flat-screen TV
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Microeconomics
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6. Normative and positive statements
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A positive statement is one that seeks to describe the world as it is. The first and third statements fall into this category.
A normative statement is one that offers an opinion as to the way the world should be. The second and fourth statements fall into this category.
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In the past decade, U.S. companies have outsourced millions of jobs overseas.
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positive
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Companies that outsource jobs are acting immorally.
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normative
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If the U.S. government were to institute higher tariffs on imports, companies would stop outsourcing jobs.
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positive
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The U.S. government should institute higher tariffs on imports.
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normative
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Killing people is bad.
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Normative
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By executing convicted murderers, the government may deter potential murderers and, therefore, decrease the murder rate.
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positive
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It is immoral for the government to kill people.
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Normative
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The government should not execute anyone, even murderers.
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Normative
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Breast cancer is the fifth most common cause of cancer death.
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positive
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For women aged 60 to 69, breast cancer screening significantly reduces breast cancer mortality.
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positive
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Doctors should encourage women aged 60 to 69 to be screened for breast cancer.
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Normative
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The government should force doctors to encourage women aged 60 to 69 to be screened for breast cancer.
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Normative
