Economic Thinking

The nature of the relationships between variables can be expressed by way of

- graphs - mathematical equations

In order to calculate an economic equation to understand its economic implications, what must one remember to do?

Follow the correct order of operations

If an economist is trying to predict the outcome from particular causes and effects, what is the best tool(s) for her to use in order to test out her economic model?

Mathematical functions

What will we never do in a world of scarcity?

Meet all of society's wants

What is NOT included in economic capital?

Money

When certain assumptions are used to create a model of reality, its value can be tested and determined by

Predicting outcomes

The distinguishing feature of economic capital (as opposed to financial capital, like money) is that it is

Productive

Identify the macroeconomic issue among the following statements.

The average cost pf producing electricity nationally is rising

A common economic model that reveals a relationship between two types of groups interacting in marketing in an economy is called

The circular flows diagram

When an economist or mathematician uses equations to calculate changing economic conditions, they use variables to simplify this process. What is a variable?

The name given to a quantity that can assume a range of values

Identify the microeconomic topic(s) among the following

The price that a farmer asks for her watermelons

In the case of an inverse relationship between two variables, all else remaining constant

The value of the two variables will move in opposite directions from each other

In the case of a positive relationship between two variables, all else remaining constant:

The values of the two variables will move in the same direction

Scarcity is a condition that is everywhere and always, since it is based upon two assumptions that reflect permanent universal conditions. The assumptions are that more output will satisfy more wants and

The world has limited productive resources

Because of our limited money, time, and effort, we are best off when we allocate those things

by constantly assessing the opportunity costs of our choices

Due to limits on our time, money, and effort, we are best off when we allocate those things...

by constantly assessing the opportunity costs of our choices

In economics, functions often describe cause and effect. In an economic function, the variable being described on the left-hand side represents a(n) ________?

effect

What is one way to express economic theory?

mathematical equations

What can be assumed if a model can accurately predict outcomes?

the assumptions of the model are generally accurate

For an economist or mathematician, a variable is

the name given to a quantity that can assume a range of values

Society gains advantages through trade because of its ability to

- Specialize resources to the uses where opportunity cost is minimized - Refine tasks associated with production

If a data line on a graph slopes upward as it goes to the right, it is depicting that

the relationship between the variables on the axes is direct