econ Flashcards
Which is the best example of specialization?
An assistant in a tailoring shop only replaces zippers
How does the division of labor increase productivity?
Workers become expert at one task
What is the main reason Americans specialize more today than the early pioneers did?
We have more access to markets
In a voluntary exchange; why do people give something up?
To get something they want more
How does the commerce clause promote economic interdependence?
It keeps states from creating trade barriers
What does it mean to say that Jen has a comparative advantage over Julian for weeding peoples gardens?
Jen’s opportunity cost for weeding is lower than Julian’s
Which of these is the main reason for national differences in comparative advantage in producing raw materials?
Differences in allocations of natural resources
Why has much clothing manufacturing moved from the U.S. to other countries ?
Nations with large low skilled workforces have a comparative advantage for assembly line production.
How does trade increase the value of an item?
It transfers the item to someone who values it more
Which term best describes the fact that we depend on others to produce most of the goods and services we want?
Economic interdependence
People’s wants are unlimited. This fact means that which of the following is always present?
Scarcity
What are the factors of production?
land; labor; and capital
which of the following is a major reason the standard of living iin japan is much higher than in nigeria?
greater human capital
risk taker
entrepreneur
why are tradeoffs necessary?
resources are limited
what does it mean to maximize utility
to gain the most satisfaction possible
Which scenario best illustrates the law of diminishing marginal utility ?
a new toy is less exciting to a child with many toys than to a child with just a few
Why might some historians consider Adam Smith one of the most influential people in history?
he introduced a way of thinking about economic ideas
which of these statements is an ex of normative economics
taxes ought to be lowered
which of these terms is most closely related to tradeoffs
scarcity
economists assume people choose something when its expected costs are less than its
anticipated benefits
A limitation of using graphs to represent relationships is that they
omit factors other than those being graphed
which statement is the best ex of thinking at the margin
john has six shirts and is trying to decide whether to buy a seventh
what is the best test of an economic model
it is useful for both explaining past events and predictiong future ones
which of the following is not a market
a high school classroom
what does it mean to say that free markets are efficient
buyers and sellers trade until both are satisfied
what is the law of unintended consequences
actions often have unforeseen effects
The law of demand states that as quantity demanded decreses
prices increases
in the summer picnic season; a sharp rise in the price of burgers may lead to an increase in demand for
chicken
quantity demanded moves along the demand curve in response to changes in
price
which of these is most likely to happen to demand for clothes in a clothing store when blizzards keep customers at home?
the demand curve shifts to the left
supply depends on the willingness and ability of
producers to produce
according to the law of supply what happens when price increases
the quantity supplied increases
which of these would most likely increase the supple of soccer balls
a decrease in the price of raw materials
the degree to which quantity demanded responds to changes in price is called
elasticity
which of these is most likely to quickly become avaliable in larger quantities as a result of a price increase?
babysitters
which of these is the best example of diminishing marginal utility
someone who has one bicylcle will have less use for another
Which of these situations best illustrates market equilibrium
the amount of soap made matches the amount of soap that people want to buy
how is the market clearing price determined
it is reached through trial and error
the equilibruium price is the price at which
demand and supply curves intersect
if a manufacturer introduced a new product with a successful advertising campaign and an artificually low introductory price which of these will most likely result
shortage
which event in florida and cali would most likely shift the supply curve for orange juice to the left
an early frost accompanied by ice storms
which of these might est signal furniture makers to cut back production
a drop in the price consumers are willing to pay
what is the usual result of setting a price ceiling on rents
more people want to rent aparments than are avaliable to rent
new deal jobs programs offered employment during the great depression. in economic terms ; such programs were designed to respond to
a surplus of workers
the purpose of rationing during ww2 was to ensure that
everone could get essential scarce goods
the most important argument many economists make against price controls is that they are
inefficient
