Chapter 1

Question 1

refers to the fact that everyone has unlimited wants.

Answer 1

Insatiability

Question 2

The state of being in a short supply; shortage.

Answer 2

Scarcity

Question 3

Curbing Insatiability and Living with Scarcity

Answer 3

Contentment

Question 4

Using wisely and well what God has given to you

Answer 4

Stewardship

Question 5

the value people place on a good or service, and that value, in turn, helps to determine the price of the good or service

Answer 5

Economic cost

Question 6

any tangible (physical) thing that has a measurable life span.

Answer 6

Goods

Question 7

intangible items, include the labor of the accountant, the performance of the singer, and the work of the teacher.

Answer 7

Services

Question 8

goods and services that bear a positive economic cost (a price tag higher than zero)

Answer 8

Economics goods and economic services

Question 9

Goods that a consumer pays to have removed are said to bear a negative economic cost

Answer 9

nuisance goods. Examples include cardboard, containers, used paper towels, broken toys, empty bottles, dirty motor oil, other garbage, toxic waste, and sewage.

Question 10

turning various nuisance goods into economic goods

Answer 10

Recycling

Question 11

Goods and services with a price tag of zero

Answer 11

Free goods and free services

Question 12

What principle states a thing is valuable because of the nature of the product, such as its scarcity or the amount of labor and natural resources that goes into its production.

Answer 12

intrinsic value

Question 13

A principle that states an object’s usefulness to the buyer that determines its worth.

Answer 13

Subjective value

Question 14

the satisfaction you receive from the choice you make.

Answer 14

Opportunity benefit

Question 15

satisfaction you give up or the regret you experience for not choosing differently.

Answer 15

Opportunity cost

Question 16

The approach of observing economic choices and predicting economic events is referred

Answer 16

Positive economics

Question 17

refers to making value judgments about existing or proposed economic policies.

Answer 17

Normative economics

Question 18

What is economics?

Answer 18

the science of why people, businesses and governments make the choices they do

Question 19

What two contradictory ideas result in the necessity of choice?

Answer 19

insatiability and scarcity

Question 20

What character quality is essential for the Christian to have victory over insatiability?

Answer 20

contentment

Question 21

What is the difference between an economic cost and an opportunity cost?

Answer 21

economic cost is the value placed on things and opportunity cost is the satisfaction you get from not choosing differently.

Question 22

What is the difference between intrinsic value and subjective value?

Answer 22

Intrinsic value: valuable according to the nature

Subjective value: valuable according to the buyer

Question 23

You must choose between going to bed at your regular time or staying up late to study. What would be the opportunity costs and benefits of this decision?

Answer 23

Opportunity cost is health, sleep, clarity of mind

Opportunity benefit is confidence

Question 24

common- sense science of how and why people, businesses, and governments make the choices they do.

Answer 24

Economics

Question 25

What is the difference between microeconomics and macroeconomics ?

Answer 25

microeconomics deals with choices made by individual units

Macroeconomics examines large-scale economic choices and issues.

Question 26

What is the difference between positive and normative economics?

Answer 26

Positive economics is observing economics choices

Normative economics is making value judgements on policies

Question 27

What idea did Menger propose that radically changed the way economists should determine an object’s value?

Answer 27

The individuals “public good”