Economics Test- Chapter 1 – Flashcards
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what is given up to acquire it
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the opportunity cost of something is:
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scarce resources
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Corner offices in high-rise office buildings usually cost more to rent than other offices. This best illustrates the economics principle of:
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the real cost of something is what you must give up get it.
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You decide to join the economics club, but this means you cant join the accounting club because it meets at the same time. This statements best represents the economic concept of:
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should I eat another donut
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For which of the following decisions would marginal analysis be most relevant?
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offer lower tuition to in-state students
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To encourage young people to go to college within their home state, state universities can:
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increase in total output that is realized when individuals specialize in particular tasks and trade with each other.
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The phrase "gains from trade" refers to the:
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allocating resources fairly may cause inefficiency.
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the trade- off between equity and efficiency occurs because:
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incentives built into a market economy
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in most cases, economic efficiency is achieved through:
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a model
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a simplified representation that is used to study a real situation is called:
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if all resources of an economy are being used efficiently, more of one good can be produced only if less of another good is produced.
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The ppf illustrates that:
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shift the ppf outward.
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Technological improvements will:
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trade-offs; produces
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a ppf illustrates the ____ facing an economy that ____ only twos goods.
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inefficient production points
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All points inside the ppf represent:
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efficient production points.
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all points on the ppf represent:
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comparative advantage
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an economy that has the lowest cost for producing a particular good is said to have a..
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must decrease
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assume an econmy is operating on its ppf. which shows the production of military and civilan goods. if the output of military goods is increased, the output of civilian goods:
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sell...buy
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the circular-flow diagram illustrates how firms___ goods and services and ___ factors of production
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factors of production;goods and services
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in the simplest circular- flow model, households supply ____ and demand
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