Chapter 1 Economics

Question 1

Resources

Answer 1

Factors of production; things that are used to produce we would like to have

Question 2

Land

Answer 2

Resources found in their natural state

Question 3

Capital

Answer 3

Resources that are made or processed

Question 4

Labor

Answer 4

The human resource/effort used to produce goods and services

Question 5

Entrepreneur

Answer 5

A risk taker in search of profits who does something new with existing resources

Question 6

Scarcity

Answer 6

Happens when it is unable to satisfy unlimited wants and limited resources

Question 7

Choice

Answer 7

What to do with resources you have on hand

Question 8

Opportunity Cost

Answer 8

The new best thing given up to get what you want

Question 9

Basic Economic Question #1

Answer 9

What. What do you produce

Question 10

Basic Economic Question #2

Answer 10

How many/much do you produce

Question 11

Basic Economic Question #3

Answer 11

How to. How do you produce it?

Question 12

Basic Economic Question #4

Answer 12

Who gets it. How do you distribute what you produce?

Question 13

Market

Answer 13

Economic system that values private property and profits ex. USA

Question 14

Command

Answer 14

Economic System that values power ex. North Korea

Question 15

Traditional

Answer 15

Economic System that values survival ex. Tribal Societies

Question 16

Production Possibilities Curve (PPC)

Answer 16

Shows the maximum combination of two good that can be produced if you use ALL your resources EFFICIENTLY

Question 17

Opportunity Cost Equation

Answer 17

OCx = Quantity y / Quantity x

Question 18

Absolute Advantage

Answer 18

Can produce more goods than another

Question 19

Comparative Advantage

Answer 19

Can produce products at a cheaper price