Flashcards and Answers – Study Guide: Economics Chapter 1
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Which of the factors of production involves taking risks and combining resources to produce a good or service?
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Capital
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A nation's wealth is determined by its
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Accumulation of all tangible product
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Which of the following would result in a change in the production possibilities frontier in the mythical country Alpha?
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An influx of immigrants from other countries, the discovery of an abundant natural resource, a long drought (all of the above)
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Consumers are powerful because
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They drive decisions about what to produce
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When a business needs to decide whether a certain action is worth the cost, the most helpful analysis would be a(n)
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Cost-benefit analysis
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When a nation's total output increases over time, the nation is experiencing
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Economic growth
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How many distinct "factors of production" do economists recognize?
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Four
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A can of soup is an example of a
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Nondurable good
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A car is an example of a
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Durable good
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Consumers waiting in long lines for a new product is an example of
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Scarcity
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Dave gets job at a grocery store, which pays him an hourly wage for his labor. Dave is participating in
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The factor marker
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Economic growth is most closely associated with an increase in
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Goods and services
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Which of the following statements best describes the purpose of the productions possibilities curve?
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It identifies all possible combinations of goods and services an economy can produce
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The amount of output in a specific amount of time with a given amount of resources is referred to as
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Productivity
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The most comprehensive measure of a nation's wealth is provided by its
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Gross domestic product
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In the mythical county Alpha, an entrepreneur has introduced a new technology that makes manufacturing twice as efficient as before. How is this likely to affect the production possibilities frontier?
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It would expand the frontier
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When deciding how to use resources, you need to evaluate the costs and benefits of each choice to decide which meets your criteria. These are called:
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Trade-offs
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Which of the following helps determine something's value?
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Utility and scarcity ('both a and c')
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Which of these do economists use to illustrate all conceivable combinations of output?
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A production possibilities curve
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Opportunity cost refers to
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The value of the next best alternative
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Which of these is most closely associated with "opportunity cost?"
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Trade-offs
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The study of economics involves
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Explaining how people deal with scarcity
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Division of labor is practiced because
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It increases efficiency by ensuring that workers become good at specific tasks
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Economics is best defined as the study of how societies deal with
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The problem of scarcity
