Econ Chapter 1

To which of the following​ household-type(s) does the phrase​ "unlimited wants and limited resources​"​apply? I. A​ low-income household II. A​ middle-income household III. A​ high-income household

I, II, and III

What is the difference between microeconomics and​ macroeconomics?

Microeconomics is the study of decision making undertaken by individuals while macroeconomics looks at the behavior of the economy as a whole

The economic system in which a government establishes ownership of resources and issues rules for how to manage the production of products is best described as...

a command and control system

The economic way of thinking will...

allow you to make better decisions

The economic way of thinking is best described as...

an analytical framework enabling one to reach informed conclusions

Positive economic statements​ ________, and normative economic statements​ ________.

are concerned with​ "what is"; are concerned with​ "what ought to​ be"

The hypothesis that people are nearly​, but not​ fully, rational, so that they cannot examine every possible choice available to them but instead use simple rules of thumb to sort among the alternatives that happen to occur to them is known as...

bounded rationality

To determine the amount of time that a person will decide to devote to watching online videos each week, an economist makes the assumption that the individual will feel overwhelmed by the sheer volume of videos available online and will respond by using a rule of thumb...

bounded rationality

To make predictions about how many apps a person will download onto her tablet device, an economist presumes that the individual faces limitations that make it impossible for her to examine every possible choice among relevant apps...

bounded rationality

Each country has a unique economic system to allocate its scarce resources.​ However, the economic system of most of the​ world's nations are a combination of the ____system and ____ system.

central planning and price system

A​ society's institutional mechanism for determining the way in which scarce resources are used to satisfy human desires refers to its...

economic system

Suppose a student is trying to decide whether or not to take another economics class. Which of the following is not an aspect of the economic way of thinking that would apply in this​ decision-making process?

flipping a coin

Until​ 2008, the people of the fictitious nation of Dor relied mainly on private car companies to determine how many automobiles to produce. After​ 2008, the people of Dor have been relying on the Dor government to determine how many automobiles to produce. This represents a shift in the economic system of Dor from...

market and central planning

"We ought to do more for the education of our​ children." Statements using words like ought or should are

normative statement

1. An economic study of the number of online searches that individuals conduct before selecting a particular item to purchase online presumes that people are interested only in their own​ satisfaction, pursue their ultimate​ objectives, and consider every relevant option. In examining the above​ decision-making process, the approach that the economist is following can best be described as the one that relies on...

rationality assumption

In evaluating the price that an individual will be willing to pay for a given quantity of a particular type of health-care service, a researcher assumes that the person considers all relevant health-care options in pursuit of his own long-term satisfaction with resulting health outcomes...

rationality assumption

1. To evaluate the impact of an increase in the range of choices that an individual confronts when deciding among devices for accessing the​ internet, an economic researcher makes the assumption that the individual is unable to take into account every new​ internet-access option available to her. In examining the above​ decision-making process, the approach that the economist is following can best be described as the one that relies on...

the assumption of bounded rationality

An economist seeking to predict the effect that an increase in a​ state's sales tax rate will have on​ consumers? Purchases of goods and services presumes that people are limited in their ability to process information about how the​ tax-rate increase will influence the​ after-tax prices those consumers will pay. In examining the above​ decision-making process, the approach that the economist is following relies on...

the assumption of bounded rationality

Decisions must frequently be made by​ individuals, organizations, and even nations. Facilitating better​ decision-making is a fundamental goal of economics. The analytical framework advocated by economists that enables one to make informed decisions is called...

the economic way of thinking

Rational, self-interested government officials seeking more funding for mass transit through higher taxes should consider...

the fact that raising taxes is generally unpopular and may result in a potential loss in a future election

The notion that people do not intentionally make decisions that would leave them worse off is known as:

the rationally assumption

Economics is the study of

the study of how limited resources are allocated to satisfy unlimited wants

A municipality taxing hotel guests to obtain funding for a new sports stadium should consider all of the​ following, except...

the winning potential of the sports team using the stadium

The ultimate purpose of economics is

to study how individuals make choices

The economic system in which individuals and families own all of the scarce resources used in​ production, decide how and what to​ produce, and how many products to​ produce, is best described as a price system. a. True b. False

true

The three basic economic questions are​ __________ will be​ produced, __________ will items be​ produced, and for​ __________ will items be​ produced?

what and how​ much; how; whom

A rational, ​self-interested student decides whether to purchase a textbook required for a particular class based on all of the​ following...

whether he can borrow a textbook from his friend

The three fundamental economic questions that a nation addresses in order to allocate​ society's scarce resources include all of the following ​except:

why will items be produced?