Economics: Test 1 Questions

Who explained the answer to the diamond-water paradox?

Which is NOT a solution to a shortage?

Who developed the principle of diminishing marginal utility?

The science of how people, businesses and governments make the choices they do...

The factor cost of ________ refers to all payments for the use of an owner's property.

This refers to all the natural resources that go into production of a good...

The factor cost of _______ refers to payments made on borrowed money.

Economics is considered a science because it deals with...

Which is NOT a factor cost businesses exchange for the factors of production?

Who are the two basic participants in the circular flow model?

The factor cost of ________ refers to all payments for labor to produce goods and services.

The value given to a good or service just because of its nature is called...

This refers to all the goods used to produce other goods...

Which is NOT a factor of production?

This refers to all the human effort that goes into the creation of a good...

Which is NOT a solution to a surplus?

The factor cost of ________ refers to all payments for labor to produce goods and services.

Which is NOT one of the two principles that drives people to make choices?

Who ultimately determines the value of an object?

3 functions of prices are to transmit information, provide incentives and move money around.