Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Econ 110 > exam I > Flashcards

exam I Flashcards

1
Q

define economics

A

the study of the allocation of scarce resources

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

what are examples of economics (6)

A

natural resources, time, skills, man power, human capital and technology capital

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

what does scarce mean

A

limited

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

a _______ always has to be made

A

choice

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

unlimited _______ > limited ___________

A

wants; resources

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

define needs and give an example

A

needs are relatively objective, and are things such as food.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

define wants and give an example

A

wants are more subjective and context-dependent, such as air-conditioning

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

true or false: scarcity is poverty

A

false, scarcity is NOT poverty

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

scarcity will never be _________

A

eliminated

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

scarcity requires ___________

A

rationing

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

define rationing

A

criteria for who will receive goods and who will not

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

what are the three types of rationing

A

government rationing
first come, first serve
markets

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

describe government rationing

A

the government determines what is made, how its made, and who gets it. it favors those with political connections

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

describe first come, first serve

A

a competition using time. favors those who get in line first.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

describe markets

A

favors those who are willing and able to pay higher prices.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

rationing methods can’t __________ competition, only changes the _______ of the competition

A

eliminate; form

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

scarcity creates ________ ___________

A

opportunity costs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

define opportunity cost

A

the use of resources to produce one good diverts those resources from the production of other goods

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

what does it mean when one option is pursued?

A

that another option must be forgone

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

nothing is _____

A

free

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

as choices are made, __________ are faced

A

tradeoffs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

what do economists assume?

A

that individuals chose options that best advance their personal desires and goals at the least possible cost

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

how are individual preferences revealed

A

by their choices

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

what can changes in incentives do?

A

affect human behavior in a predictable way

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

define marginal thinking

A

changes in cost and benefit

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

marginal benefit _ marginal cost

A

>

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

what does marginal cost equal

A

opportunity cost

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

define the sunk cost fallacy

A

informing future decisions on past costs is irrational and ineffective

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

give some examples of sunk cost fallacies

A

non-refundable gifts
not being able to leave due to a lease
spent twenty hours studying, so can’t drop the class

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
30
Q

why are non-refundable gifts irrational

A

people believe that since they bought it, they have to use it

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
31
Q

what are secondary effects

A

direct and indirect costs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
32
Q

give an example of a secondary effect

A

using paper bags instead of plastic bags.
led to more expensive products, that were harder to produce
the plastic kept bacteria at bay and E. coli formed in moist paper bags

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
33
Q

what does opportunity cost illustrate

A

that information can be very costly to obtain

34
Q

decision making with ________ information is often more desirable than with ________ information

A

imperfect; perfect

35
Q

who wrote about how markets use information

A

F.A. Hayek

36
Q

what is the knowledge problem

A

the knowledge and specialties of millions of people are required to produce even the simplest of objects is too much information for any person/institution/etc to contain, let alone fluidly respond

37
Q

define productive efficiency

A

it is impossible to produce more of one good without decreasing the quantity that is used to produce another good

38
Q

define allocated efficiency

A

produced goods/services represent the most socially desired combination

39
Q

what is an example of allocated efficiency

A

the amish

40
Q

there are _ inputs of factors of production

A

4

41
Q

what are the four inputs of ppf

A

land, labor, capital, entrepreneurship

42
Q

what is ppf

A

production possibility frontier

43
Q

what is land ppf

A

all space is being used adequately

44
Q

what is labor ppf

A

human or animal labor

45
Q

what is capital ppf

A

education or machinery

46
Q

what is entrepreneurship ppf

A

human creativity

47
Q

the ppf curve requires what?

A

requires that the four inputs were all fully utilized

48
Q

what does a bowed-out ppf represent

A

opportunity costs are increasing

49
Q

what does a linear ppf represents

A

opportunity costs are constant

50
Q

define comparative advantage

A

moving one way greatly benefits one, while barely impacting the other.

51
Q

define specialization

A

the gains from trade become larger over time

52
Q

what can specialization effect?

A

both quantity and quality of goods/services

53
Q

mutually beneficial exchange drives ________ ________

A

economic growth

54
Q

what are the three barriers of exchange

A

capital, trade, labor

55
Q

explain the capital barrier of exchange

A

human- government cuts off/blocks internet access
technology- new tech can’t leave country it was created in

56
Q

explain the trade barrier of exchange

A

embargo- prevents the exchange of goods and movement of people

57
Q

explain the labor barrier of exchange

A

no free movement of labor (citizens can move freely, immigrants can’t).

58
Q

if barriers were taken away:
_% increase in capital
_% increase in trade
_________ in labor

A

1
2
double

59
Q

define efficiency

A

any person/firm/government can produce many goods and services

60
Q

producing is the easy part. what is the hard part?

A

getting people to buy the product

61
Q

what does private property best align with

A

self-interest with productive and allocated efficiency

62
Q

what does private property include

A

the right to exclude
protection under the law
the right to transfer, sell, exchange or mortgage property

63
Q

what are the four property right incentives and describe them

A
  1. can gain by employing their resources in ways beneficial to others
    ie: landlord renting out property
  2. have the incentive to care for and properly manage what they own
  3. have the incentive to conserve for the future
    ie: eating all your snacks so your roommate can’t eat them
  4. have the incentive to lower the chance that they will cause damage/harm to others
    ie: the more likely one is to be held liable for damage the more steps they take to prevent the damage
64
Q

what did Adam smith write

A

the wealth of nations

65
Q

what did smith question

A

mankind’s destitute poverty
why and how some nations had escaped this fate and become wealthy

66
Q

what did smith believe the divergence of wealth came from

A

self-interest

67
Q

define self interest

A

prevails in the economic sphere in order to facilitate exchange between strangers

68
Q

incentives may impact _______ ___________

A

cost benefit

69
Q

how can individuals in their peruser of wealth assist others?

A

by providing desired goods, services, or jobs

70
Q

exchange matches _______ and _______

A

wants, needs

71
Q

what did smith believe people were led by

A

an invisible hand

72
Q

what did the invisible hand represent

A

unintended consequences in exchange

73
Q

define command economics

A

centralized decision-making determined by politicians

74
Q

what is command economics

A

public ownership, not redistribution

75
Q

define market economies

A

decentralized decision-making between individuals

76
Q

what are Market economies

A

private ownership, not capitalism

77
Q

what is the economic freedom survey?

A

an attempt to measure the degree of economic freedom in the world’s nations

78
Q

what is looked at for economic freedom

A
  1. personal choice in the use of resources
  2. voluntary exchange coordinated by markets via the political process
  3. freedom to enter and compete in markets
  4. protection of persons and their property from aggression by other
79
Q

what are the index measures

A
  1. size of government
  2. security of property rights
  3. access to spending money
  4. freedom to trade
  5. regulation of credit, labor, and business
80
Q

what are variables for index measure

A

tax rate, degree of judicial independence, inflation rates, etc

Econ 110 (4 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions