Economics Test 1
A government that makes major economic decisions, has fewer choices, more government owned businesses, and is sometimes called Centrally Planned is? Examples: Socialism and Communism
Command
Goals for the Economy
Economic efficiency, freedom, security, equity/fairness, growth
What are the 4 factors of production?
Land, labor, capital, and entrepreneurship
Who wrote "I Pencil?"
Leonard E. Read
A capitalist, free market and enterprise, free from government control, multitude of consumer and career choices government is? (Consumer is KING.)
Market
What are the 2 divisions of economics?
Microeconomics and Macroeconomics
What is the number one economic problem?
Scarcity
What are the two elements that must be present for value to be assigned?
Scarcity and utility
Economics is a...
Social Science
"Revenge of the Nerds?"
The concept that the more education someone has the more money they will get later.
TINSTAAFL?
There is no such thing as a free lunch.
Laissez-faire?
Those that which governs best governs least.
A rural economy with few choices, mainly consists of agriculture, and appeared before the Industrial Revolution is? Examples: Mennonites and Amish
Traditional
What are the three types of economies?
Traditional, command, and market
Explain the water/diamond paradox.
Water is necessary for survival, but it is not expensive. This is because we have water in abundance. Diamonds are not necessary for life, but they are expensive. This is because diamonds are rare or scarce.
What book did Adam Smith write? What year?
Wealth of Nations; 1776
What are the 3 questions that every economy answers?
What to produce, how to produce, and for whom to produce
Who is the father of economics?
Adam Smith