Economics: Chapters 1-4 + PPC

Question 1

Economic’s

Answer 1

Practical science dealing with production/distribution, and the use of goods/services as well as our resources

Question 2

Economy

Answer 2

Complex/intricate system w/ many participants/stakeholders

Question 3

Analytical Economic’s

Answer 3

Branch of economics that deals with facts/direct observations

Question 4

Normative Economic’s

Answer 4

Branch of economics that deals with primarily concerns statements that contain value judgements

Question 5

Fallacy of Composition

Answer 5

Mistaken belief that what’s good for someone is automatically good for everyone

Question 6

Post Hoc Fallacy

Answer 6

Mistaken belief that what occurs before an event is logically the cause of it

Question 7

Fallacy of Single Causation

Answer 7

Mistaken belief that has one cause and not several others

Question 8

Opportunity Cost

Answer 8

Value that must be given up for something else

Question 9

Relative Cost

Answer 9

Cost of producing one A in terms of one B (You lose one A to gain _ B)

Question 10

Economic Laws

Answer 10

1. Two products can be produced by this simple economy
2. The economy has fixed technology & resources
3. Economy is at full employment

Question 11

Law of Increasing Cost

Answer 11

Increase in relative cost of producing more A measured by B

Question 12

Law of Diminishing Returns

Answer 12

Eventual decline in the reate of extra outputs produced when one input used in production of the output is held constant and others are increased

Question 13

Law of Increasing Returns - Scales

Answer 13

Increase in rate of extra outputs produced when all inputs in production are increased & no inputs are held constant

Question 14

Productive Resources

Answer 14

Resources (land & labour) that are necessary for production and are visible

Question 15

Tangible Resources

Answer 15

Land, labour, capital

Question 16

Intangible Resources

Answer 16

Knowledge, entrepreneurship, environment for enterprise

Question 17

3 Main Economies

Answer 17

Traditional Economy: Based off religious practices
Command Economy: Based off government
Market Economy: Based on actions of buyers and sellers in marketplace

Question 18

Capitalism

Answer 18

Economy characterized by private ownership of business, industry, profit motive, and free markets

Question 19

Communism

Answer 19

System on extreme left which calls for government/community ownershop of the means of production

Question 20

Socialism

Answer 20

System on moderate left which calls for public ownership of principal means of production, to be achieved in a democratic and peaceful manner

Question 21

Fascism

Answer 21

System on right combining free market economy w/ non-democratic form of government

Question 22

Four Factors of Production

Answer 22

1. Land
2. Human Resources/Labour
3. Capital
4. Entrepreneurship Flare/Productivity

Question 23

Concave

Answer 23

Increased law of opportunity cost

Question 24

Meaning of PPC

Answer 24

Production Possibility Curve

Question 25

All Beef or All Corn?

Answer 25

What do you think?