Buyers and sellers act in their own self interest

Economic activity includes

Production, Distribution & Consumption

explain how average cost goes down as you produce more

Which of the following best describes the relationship between trade-offs and opportunity cost

Opportunity costs are incurred when trade-offs are made

The "Invisible Hand" shows how

prices guide the market to achieve desirable outcomes in society.

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Mankiw Chapter 1: Ten Principles of Economics

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The basics of economics

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Questions 14

Answers

1
Why are all goods and services scarce?
all resources are scarce
Some goods cost more than others
some things are needs and others are wants
some people want to have more goods than others
2
An economic system where the state or government makes economic decisions
Efficient Economy
Free Enterprise
Inflationary Economy
Command Economy
3
The benefits of trade do NOT include
A guarantee of low prices
Countries can specialize
Trade allows competition and maximization of benefits
Consumers have more goods to choose from
4
In free markets,
Buyers and sellers act in their own self interest
Government tells sellers what to produce
There is a lot of government interference
Goods and services are free
5
Economic activity is best achieved
in all of these
in a market economy
in a centrally planned economy
in a command economy
6
Adam Smith wrote the book
Wealth of Nations
How Government Interference improves the Economy
Wealth of the Aristocracy
The Invisible Hand
7
Economic activity includes
Production, Distribution & Playing
Production, Distribution & Consumption
All of these
Education, Distribution & Consumption
8
Economies of scale
explain how trade does not benefit everyone
shows how the scale of justice favors companies
explain why specialization has no benefits
explain how average cost goes down as you produce more
9
The person responsible for "the invisible hand"
Karl Marx
Vladimir Lenin
Joseph Stalin
Adam Smith
10
Which of the following best describes the relationship between trade-offs and opportunity cost
Trade-offs lower the opportunity costs of a decision
Opportunity costs are the opposite of trade-offs
Trade-offs occur when there are no opportunity costs
Opportunity costs are incurred when trade-offs are made
11
Trade allows people to consume different types of goods/services at a lower cost
True
False
12
Word that means: society is getting the maximum benefits from its scarce resources.
equality
efficiency
equity
spread the wealth
13
In a market economy, buyers & sellers act as if guided by an invisible hand
True
False
14
The "Invisible Hand" shows how
society is controlled
people's minds are controlled by an unseen force
government controls society
prices guide the market to achieve desirable outcomes in society.

Mankiw Chapter 1: Ten Principles of Economics Flashcards | StudBud