Economics Chapter 1
What is a market economy?
a location or other mechanism that allows buyers and sellers to exchange a certain economic product).
What is a consumer?
a person who uses goods and services to satisfy both wants and needs.
Because of our productivity levels of a nation, the American economy has a remarkable degree of _________________.
economic interdependence.
____________ is the money used to buy the tools and equipment used in production.
financial capital
__________ is the dollar value of all final goods and services and structures produces within a country's borders in a 12 month period.
gross domestic product
Is a service tangible or intangible?
intangible
A __________ is an item that lasts for less than 3 years when used on a regular basis.
non durable good
Name three factors that all have a dramatic impact on both the quantity and quality of labor.
population growth, immigration, famine, war, and disease
__________ takes place when factors of production perform tasks that they can do relatively more efficiently than others.
specialization
Name the four key elements of the study of economics.
1.)description 2.)analysis 3.)explanation 4.)predictions
The study of economics attempts to answer which three basic questions?
1.)what to produce 2.)how to produce 3.)for whom to produce
Fords perfection of the assembly line cut the production time for his Model T from a few days to a couple weeks for each unit to _____ __________.
90 minutes
What is considered work that is performed for someone else?
A service
The importance of _______ is that it helps discover why things work and how things happen.
Analysis
_______is the tools, equipment, machinery, and factories used in the production of all goods and services.
Capital
When manufactured goods are used to produce other goods as well as services, they are called _________.
Capital goods
What is intended for final use by individuals?
Consumer good
___________ takes place when work is arranged so the individual workers do fewer tasks than before.
Division of labor
Entrepreneurs often are thought of as being the ______ _______ in an economy.
Driving force
Any good that lasts 3 years or more when used on a regular basis is called a _________.
Durable good
What occurs when a nations total outputs of goods and services increases over time?
Economic growth
What are goods and services that are useful, relatively scarce, and transferable to others?
Economic products
________is the study of how people try to satisfy what appears to be seemingly unlimited and competing wants through the careful use of relatively scarce resources.
Economics
Such an individual as an __________ are considered risk trackers in search of profits who accomplishes something new with existing resources.
Entrepreneur
What are markets where productively resources are bought and sold known as?
Factor markets
The __________ for resources required to produce the things we would like to have include______,_______,_______, and___________.
Factors of production Land Capital Labor Entrepreneurs
True or false: Both goods and services are counted as wealth.
False
True or False: Labor is a resource that is considered fixed like land.
False: Unlike land, labor is a resource that may vary in size over time.
What is an item that is economically useful or satisfies an economic want ?
Good
What does GDP stand for?
Gross Domestic Product
One of the best examples of division of labor and specialization is __________ introduction of the assembly's into automobile manufacturing.
Henry fords
________ is people with all of their efforts, abilities, and skills.
Labor
_______ refers to the gifts of nature or natural resources not created by humans.
Land
Markets may be ______, _______, or ______.
Local Regional Global
A ______ is a basic requirement for survival and includes food, clothing, and shelter.
Need
An example of a capital good would be an _______.
Oven
Which of the four key elements of the study of economics is used to guess what may happen to the economy in the future?
Prediction
What are markets where producers sell their goods and services to consumers?
Product markets
___________ is the process that utilizes all factors of production in the creation of goods and services
Production
The fundamental economic problem facing all societies is that of ________.
Scarcity
What is human capital?
The sum of all skills, abilities, health, and motivation of people
What does TINSTAAFL stand for?
There is no such thing as a free lunch
True or False: GDP is the most comprehensive of a country's total output and is a key measure of the nations economic health
True
True or false: Economists knew that scarcity is required for value. The problem for economists is understanding scarcity in and in itself is nit enough to create value.
True
True or false: economists tend to think of land as being a fixed resource
True
True or false:Utility is not something that is either fixed or measurable
True
A ________ is a way of expressing a need.
Want
What does value refer to?
Work that can be expressed in dollars and cents
Is a good tangible or intangible?
tangible
What is wealth?
the accumulation of those products that are tangible, scarce, useful, and transferable from one person to another.
What is utility?
the capacity to be useful and provide satisfaction
What is the "paradox of value"?
the situation where basic necessities, such as water, have little monetary value as compared to some non-necessitates such as diamonds, which have a much higher value.