Economics Quizlet
The fact that people with higher incomes get to consume more goods and services addresses the ________ question
"for whom"
When the government decides to provide tax relief for small businesses while placing higher taxes on large corporations, it is facing the
"for whom" tradeoff.
When China builds a dam using few machines and a great deal of labor, it is answering the ________ question.
"how"
When a textile company keeps track of its inventory using a computer and its competitor uses a spreadsheet and pencil, they are both answering the ________ question.
"how"
When a photographer decides to use a digital camera to take shots versus using film, the photographer is facing the
"how" tradeoff.
U.S. producers decide to produce more compact cars and fewer SUVs as the price of gasoline rises. Producers are answering the ________ question.
"what"
When an economy produces more houses and fewer typewriters, it is answering the ________ question.
"what"
When firms in an economy start producing more computers and fewer televisions, they are answering the ________ question.
"what"
The question "Should movies or compact discs be produced?" is an example of the
"what" question.
When a farmer decides to increase the amount of acreage devoted to wheat and grow fewer acres of soybeans, the farmer is facing the
"what" tradeoff.
When a university decides to add to the football stadium instead of adding to the baseball stadium, it faces the
"what" tradeoff.
During the summer you have made the decision to attend summer school, which precludes you from working at your usual summer job in which you normally earn $6,000 for the summer. Your tuition cost is $3,000, books and supplies cost $300, and room and board cost $1,000. The opportunity cost of attending summer school is
$10,300.
You decide to take a vacation and the trip costs you $2,000. While you are on vacation, you do not report to work where you could have earned $750. The opportunity cost of the vacation is
$2,750.
During the next hour John can play basketball, watch television, or read a book. The opportunity cost of reading a book
is the value of playing basketball if John prefers that to watching television.
An autoworker is considered ________ and earns ________.
labor; wages
Overtime worked by a JCPenney associate is considered ________ and earns ________.
labor; wages
Economics is best defined as the study of how people, businesses, governments, and societies
make choices to cope with scarcity.
Scarcity requires that people must
make choices.
In broad terms the difference between microeconomics and macroeconomics is that
microeconomics studies decisions of individual people and firms and macroeconomics studies the entire national economy.
) Studying the determination of prices in individual markets is primarily a concern of
microeconomics.
The analysis of the behavior of individual decision-making units is the definition of
microeconomics.
When the government chooses to use resources to build a dam, these sources are no longer available to build a highway. This choice illustrates the concept of
opportunity cost
The loss of the highest-valued alternative defines the concept of
opportunity cost.
The term used to emphasize that making choices in the face of scarcity involves a cost is
opportunity cost.
When an action is chosen, the highest-valued alternative NOT chosen is called the
opportunity cost.
Entrepreneurs do all of the following EXCEPT
own all the other resources
The most fundamental economic problem is
scarcity
Marginal benefit is the benefit
that arises from an increase in an activity.
Which is the most accurate definition of the study of economics? Economics is the study of
the choices we make because of scarcity.
Macroeconomics is the branch of economics that studies
the economy as a whole.
Microeconomics focuses on all of the following EXCEPT
the effect of increasing the money supply on inflation
Which of the following is an issue in macroeconomics?
the effect of increasing the money supply on inflation
The opportunity cost of something you decide to get is
the highest valued alternative you give up to get it.
Opportunity cost means
the highest-valued alternative forgone.
The opportunity cost of any action is
the highest-valued alternative forgone.
The ultimate cost of any choice is
the highest-valued alternative forgone.
Which of the following is a macroeconomic topic?
the reasons for the rise in average prices
Which of the following is a microeconomic topic?
the reasons why Kathy buys less orange juice
Human capital is
the skill and knowledge of workers.
Which of the following is NOT a factor of production?
the wages paid to workers
Macroeconomic topics include
total, nationwide employment.
On Saturday morning, you rank your choices for activities in the following order: go to the library, work out at the gym, have breakfast with friends, and sleep late. Suppose you decide to go to the library. Your opportunity cost is
working out at the gym
Which of the following statements is correct?
The United States produces more services than goods.
The "how" tradeoff occurs when
a farm uses machinery to pick oranges instead of employing migrant workers.
Which of the following is NOT a factor of production?
a share of stock issued by a firm
Because we face scarcity, every choice involves
an opportunity cost
The term "opportunity cost" points out that
any decision regarding the use of a resource involves a costly choice.
An incentive
could be either a reward or a penalty.
Misty has the option of purchasing one of three products: Brand A, Brand B, or Brand C. Each costs ten dollars. If she decides that Brand A meets her needs best, then the opportunity cost of this decision is
Brand B or Brand C, depending on which is considered the highest-value alternative forgone.
From 8 to 11 p.m., Sam can either attend a basketball game, a hockey match or the symphony. Suppose that Sam decides to attend the hockey match and thinks to herself that if she did not go to the match she would go to the symphony. Then the opportunity cost of attending the hockey match is
going to the symphony.
Which of the following is a macroeconomic issue?
how federal government budget deficits affect interest rates
Which of the following topics would be studied in a microeconomics course?
how rent ceilings impact the supply of apartments
To answer the "for whom" question, we study
income differences.
Which of the following is NOT an example of an opportunity cost?
Because Mary is now being paid a higher wage, she can afford to buy a new car even though she is moving into a bigger apartment.
Which of the following is correct concerning production in the United States?
The percentage of people employed in farming has decreased over the last 60 years.
As an economic concept, scarcity applies to
both money and time.
Economists point out that scarcity confronts
both the poor and the rich.