Chp 2

Question 1

economists think like _______. As well as they make assumptions for _____ understanding.

Answer 1

1. scientists
2. easier

Question 2

in the circular flow diagram households ____ goods & services while firms ____ goods & services.

Answer 2

1. Buy
2. Sell

Question 3

in the circular flow diagram, households ___ factors of production while firms ____ factors of production.

Answer 3

1. sell
2. hire

Question 4

in the circular flow diagram money circles ______

Answer 4

counterclockwise

Question 5

production possibility frontier

Answer 5

a graph which shows how much of what product you can produce at the cost of the other product. showing efficiency, tradeoffs, opportunity cost, and economic growth.

Question 6

micro vs macro economics

Answer 6

micro is how decisions by households and firms are made in specific market interactions macro is the economy as a whole and how all the decisions from micro affect macro

Question 7

govt seeks an economist that is ____

Answer 7

one-armed

Question 8

economist advice

Answer 8

is usually two-handed and includes tradeoffs