Chapter 1 Flashcards
1
Q
Incentives
A
Rewards and penalties that motivate behavior
2
Q
Trade-offs are
A
EVERYWHERE
3
Q
Opportunity Cost
A
every choice involves something gained or lost
4
Q
Great Economic Problem
A
how to arrange our sources to satisfy as many wants as possible
5
Q
scarcity
A
when a resource is scarce there isn’t enough to satisfy all of our wants
6
Q
Marginal
A
one or less
7
Q
Trade makes
A
people better off
8
Q
Wealth and economic growth are
A
IMPORTANT
9
Q
Institutions
A
Matter
10
Q
Inflation is
A
caused by an increase in money supply
