Basics of Economics

Capitalism thrives on innovation and competition. Which scenario would be MOST in opposition to a Capitalistic Economy?

This division of economics focuses on the workings of an entire economy.

Decisions made today have effects down the road

The study of how people choose to use their limited resources to satisfy their unlimited wants;Adam Smith "Father" of..

This division of economics studies decision making by individual people, households, and businesses.

Decisions about what, how, and for whom to produce are made by a powerful ruler or other authority/government.

Which of the following is NOT one of the 3 essential questions of Economics?

Motivation for a person to take a course of action

Both the government and individuals play important roles w/ regard to production and consumption;gov't role kept minimal

Limited resources push people to make choices and make sacrifices

This branch of economics examines which policies should be implemented; focuses on how things ought to be (idealistic)

Organizing exchanges between buyers and sellers

This branch of economics uses objective analysis to find out how the world works. The goal is to describe how things are

This is what you’re doing when you decide whether or not what you put into something is worth what you get out of it.

The U.S. Constitution helps define the limited role of the U.S. Government in our economy.

Which of the following ideas is most closely associated with a Free Market Economy?

The difference between revenue and cost ("take-home")

Focus on what we do well and barter with others

Which of the following is NOT a way that productivity can be increased?

Income generated by the sale of goods or services (price times quantity)

First and oldest economic system; still practiced amongst nomadic and indigenous peoples. Customs and traditions dictate

Spending money, time, effort, and what you gain from it

Money spent for the inputs used in producing a good/service; amount spent to produce the product/ service times quantity

Any factor that encourages/motivates a person to do something;traffic tickets are a - ex. Extra credit pts are a + ex,

The amount consumers pay for a good or service

Which of the following is a positive incentive?

Consumers decide what will be produced by casting their “dollar votes.” Producers choose the most profitable method

The condition that results because people have limited resources but unlimited wants; something is very hard to find