Economics Midterm

Question 0

_____ is the study of how people seek to satisfy their needs and wants by making choices.

Answer 0

Economics

Question 1

The study of economics begins with the idea that people cannot have everything the _____ and _____

Answer 1

Want, need

Question 2

_____ occurs when there are not a lot of goods and services available.

Answer 2

Scarcity

Question 3

_____ is different from scarcity.

Answer 3

Shortage

Question 4

There is always scarcity because people always need and want more than there _____ is.

Answer 4

Actually

Question 5

_____ __ _____are the resources that are used to make all goods and services

Answer 5

Factors of production

Question 6

_____ refers to all natural resources

Answer 6

Land

Question 7

_____ is the effort that a person devotes to a task for which that person is paid

Answer 7

Labor

Question 8

There are two categories of capitol:

Answer 8

Physical and human

Question 9

_____ _____ human-made objects used to create other goods and services.

Answer 9

Physical capital

Question 10

_____ _____ the knowledge and skills a worker gains through education and experience

Answer 10

Human capital

Question 11

Labor, land, and capital are all _____ __ _____

Answer 11

Factors of production

Question 12

_____ are leaders who decide how to combine the factors of production to create new goods and services.

Answer 12

Entrepreneurs

Question 13

Everyone makes decisions that involve _____-_____

Answer 13

Trade-offs

Question 14

_____ __ _____ is a phrase used to describe the economic trade-offs whole nations face

Answer 14

Guns or butter

Question 15

The most desirable alternative given up is referred to as _____ _____

Answer 15

Opportunity cost

Question 16

Thinking at the margin means:

Answer 16

deciding whether to do or use one additional unit of some resource.

Question 17

Making a decision at the margin requires you to look at the _____ _____ of each decision and compare the benefits.

Answer 17

Opportunity cost

Question 18

This decision making process is sometimes called _____\_____ _____

Answer 18

Cost/benefit analysis

Question 19

A _____ _____ _____ is a graph that shows alternative ways to use an economy’s productive resources

Answer 19

Production possibility curve

Question 20

The _____ _____ _____ is the line made on the graph connecting all of the points

Answer 20

Production possibility frontier

Question 21

_____ means to maximize the possible production or output of resources.

Answer 21

Efficiency

Question 22

Any point inside the production possibilities frontier indicates an _____
This means that there are fewer resources being used than the economy is capable of using.

Answer 22

Underutilization

Question 23

_____ can also show economic growth and future possibilities.
●When an economy grows, economists say the curve as “shifted to the right”.
●When a country’s production capacity has decreased, the curve shifts to the left.

Answer 23

Graphs

Question 24

_____ does not always equate to money

Answer 24

Cost

Question 25

_____ __ _____ _____ as we shift factors of production from making one good or service to another, the cost of producing the second item increases

Answer 25

Law of increasing costs

Question 26

A country’s production possibilities depend on both its _____ _____ and the _____ it has available

Answer 26

Technological level, resources