economics ch 1 true or false – Flashcards
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economics is the social science that studies how individuals, institutions and society make choices under conditions of scarcity
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true
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from the economic perspective there is no such thing as a free lunch
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true
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the economic perspective views individuals or institutions as making purposeful choices based on the marginal analysis of the costs and benefits of decisions
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true
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the scientific method involves the observation of real world data the formulation of hypothesis based on the data and the testing of those hypotheses to develop theories
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true
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well tested or widley accepted economic theory is often called an econimic priciple of law
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true
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the other things equal (ceteris paribus) is made to simplify the economic anlysis
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true
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macroeconomics analysis is concerned with the economic activity of specific firms or industries
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false
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the statement that the legal minimum wage should be raised to give working people a decent income is an example of a normative statement
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true
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a person using positive economics when the person makes value judgements about how the economy should work
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false
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the conflict between the unlimitied economic wants of individuals or societies and limited economic means and resources of individuals or societies gives rise to the economizing problem
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true
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the budget line shows all combinations of two products that the consumer can purchase given money income and the prices of the products
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true
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a consumer is unable to purchase any of the combinations which lie below or to the left of the consumers budget lines
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false
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the factors of production are land, labor, capital and entreneural abillity
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true
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from the economists perspective investment refers to money income
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false
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the economic rationale for the new law of increasing opprotunity costs is that economic resources are fully adaptable to alternative uses
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false
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optimal allocation is determined by assessing the marginal costs and benefits of the output from allocation of resources to production
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true
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economic growth means an increase in the production of goods and services and is shown by a movement of the production possibilities curve outward and to the right
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true
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the more capital goods an economy produces today the greater will be the total output of all goods it can produce in the future other things being equal
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true
