In economics, rational decisions occur when...

marginal benefits equal or exceed marginal costs

Why is the consumer considered "king" in a capitalist economy?

consumers determine what products will be produced

Opportunity cost is best defined as:

amt of 1 item given up to make 1 more unit of another item

What is the primary purpose of job specialization?

Increased efficiency and productivity

Specialization in production is economically beneficial because it...

facilitates trade by bartering, permits production of a larger output with fixed resources

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Econ Unit One Review

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#Economics #Fundamentals of Econ

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Questions 12

Answers

1
In economics, rational decisions occur when...
a budget is used for spending & saving decisions
command economies answer the 3 basic economic questions
marginal benefits equal or exceed marginal costs
suppliers lower their prices to increase demand
2
The basic economic condition that exists when unlimited wants exceed limited resources
opportunity cost
capital
scarcity
hyperinflation
3
Workers on an assembly line are an example of
entrepreneurs
homogenization
specialization
allocation
4
Land, Labor, Capital and Entrepreneurship are the
results of production
factors of production
results of supply and demand
Basis of employment
5
Competition and free enterprise are most common in which type of economic system?
Command
Market
Socialism
Traditional
6
Why is the consumer considered "king" in a capitalist economy?
consumers own the productive resources
consumers contribute to the factor market
consumers determine what products will be produced
consumers vote for elected government officials
7
When govt tries to protect USA from bad econ. events, it's trying to achieve economic goal of:
economic security
economic growth
economic freedom
economic efficiency
8
Opportunity cost is best defined as:
the amount of labor used to produce one unit of a product
the monetary price of any productive resource
ratio of prices - imported goods vs prices of exported goods
amt of 1 item given up to make 1 more unit of another item
9
Which term refers to the extra or additional cost of producing one additional unit of output?
Variable cost
Fixed cost
Marginal cost
Total cost
10
What is the primary purpose of job specialization?
Increased efficiency and productivity
Increased marginal utility
Regional Self Sufficiency
Increased consumer income
11
In a free enterprise system, what motivates individuals to start a business?
The risk of failure
The need for job security
The desire to make economic decisions
The desire to earn a profit
12
Specialization in production is economically beneficial because it...
facilitates trade by bartering
allows everyone to have a job they like
guarantees full employment
permits production of a larger output with fixed resources

Econ Unit One Review Flashcards | StudBud