Unit 1 Review

Question 1

Terry's favorite coffee shop messes up her order! She immediately says she will never be back! This is an example of:

Accepted Answer

Worrying about fairness

Question 2

Earning a doctoral degree would be an example of gaining what type of resource?

Accepted Answer

Human Capital

Question 3

An economy is a system that coordinates what?

Accepted Answer

The production and distribution of goods and services.

Question 4

A farmer notes that every additional time he waters his fields, his crops get less value from it. This is due to:

Accepted Answer

Law of Diminishing Marginal Returns

Question 5

In the below image, Point A would be considered:

Accepted Answer

Inefficient

Question 6

A giraffe would be an example of what type of resource?

Accepted Answer

Land

Question 7

Which of the following would be the correct use of the term: Ceteris Paribus?

Accepted Answer

Lions are large and powerful animals, Ceteris Paribus.

Question 8

What would be an example of something in this world that is NOT scarce?

Accepted Answer

Nothing!!

Question 9

The below image illustrates a sustained increase in production over time. Also known as:

Accepted Answer

Growth

Question 10

A simple explanation as to why the PPC is curved is due to the Law of:

Accepted Answer

Increasing Opportunity Cost

Question 11

Harry is trying to figure out how many times a week he should water his garden. Analyze the following table:

Accepted Answer

6

Question 12

Because they allow economies to consume beyond their production possibilities, economists strongly urge:

Accepted Answer

Specialization & Trade

Question 13

"The study of behavior among interdependent actors" is known as:

Accepted Answer

Game Theory

Question 14

Opportunity Cost is the value of _____________ option to any decision.

Accepted Answer

The next best

Question 15

Define: Incentive

Accepted Answer

Something that motivates a person to an action or decision.

Question 16

Economics is the study of what?

Accepted Answer

Choice in a scarce environment.

Question 17

Comparative Advantage means that a trading partner can produce ________ than its trading partner.

Accepted Answer

A good at a lower opportunity cost

Question 18

In the below PPC, what would be the opportunity cost to increase Corn production from 500 to 600 units?

Accepted Answer

300 Wheat

Question 19

What is the Nash Equilibrium in the below matrix?

Accepted Answer

Bottom-Left

Questions 19