econ test 1

Question 1

what is the definition of scarcity?

Answer 1

the fundamental economic problem of having unlimited human wants in a world of limited sources

Question 2

what is the definition of opportunity cost?

Answer 2

the value of the next best alternative that is forgone when making a decision

Question 3

what is the definition of trade-offs?

Answer 3

the balance achieved between 2 desired but incompatible features; giving up one thing to gain another)

Question 4

what is the definition of markets?

Answer 4

a system or a place where buyers and sellers interact to exchange goods and services

Question 5

what is the definition of externality?

Answer 5

a cost or benefit incurred by a third party that did not choose to incur to that cost or benefit

Question 6

what is the definition of a public good?

Answer 6

a good that is available for all to consume without reducing its availability to others

Question 7

what is an example of a public good?

Answer 7

clean air

Question 8

what is the definition of a common property resource?

Answer 8

a resource that is available to all but is susceptible to overuse & depletion

Question 9

what is an example of common property resources?

Answer 9

fisheries

Question 10

what are the different forces that affect stocks in closed system?

Answer 10

1. supply an demand dynamics
2. market sentiment and investor behaviour
3. economic indicators
4. regulatory changes and policies
5. global economic conditions

Question 11

give me an example of economic indicators?

Answer 11

inflation, unemployment rates

Question 12

what is the definition of throughput?

Answer 12

the rate at which resources are extracted from the environment, transformed into products, and eventually returned as waste

Question 13

in ecological economics, what is meant by throughput?

Answer 13

it reflects the flow of materials and energy through the economic system and its impact on the ecosystem

Question 14

what are the conditions of a well-functioning market?

Answer 14

1. property rights are well-defined and enforced
2. no externalities affecting market transactions
3. complete information is available to all market participants
4. low transaction costs in market exchanges

Question 15

what are the conditions of NOT efficient market?

Answer 15

1. presence of externalities
2. imperfect information and asymmetry
3. market power or monopolies
4. public goods and common resources leading to overuse

Question 16

what is the definition of a market failure?

Answer 16

a situation where the allocation of goods and services by a free market is not efficient, leading to a net loss economic value

Question 17

briefly define climate change

Answer 17

long-term alteration in temperature and typical weather patterns in a place, primarily driven by human activities that increase greenhouse gas concentrations in the atmosphere

Question 18

list key sources of CO2 emissions

Answer 18

1. fossil fuel combustion
2. industrial processes
3. deforestation and land-use changes

Question 19

give an example of fossil fuel combustion

Answer 19

electricity generation, transportation

Question 20

give an example of industrial processes

Answer 20

cement production, chemical manufacturing

Question 21

list the key greenhouse gas emissions

Answer 21

1. CO2
2. Methane (CH4)
3. nitrous oxide (N2O)
4. fluorinated gases

Question 22

give a rough percentage of the contribution of CO2

Answer 22

~76%

Question 23

give a rough percentage of the contribution of Methane (CH4)

Answer 23

~16%

Question 24

give a rough percentage of the contribution of nitrous oxide (N2O)

Answer 24

~6%

Question 25

give a rough percentage of the contribution of fluorinated gases

Answer 25

~2%

Question 26

what is the order of a simplified circular fow model

Answer 26

1. factor markets
2. households
3. product market
4. firms