intro to economics (book 1)

Question 1

economics is a _______ science

Answer 1

economics is a social science

Question 2

the law of ________ is that when the ______ of a good increases, demand will ________.

Answer 2

the law of demand is that when the price of a good increases, demand will decrease.

Question 3

positive statements are _______ statements that _____ be tested.

Answer 3

positive statements are objective statements that can be tested.

Question 4

normative statements are ________ statements that carry _______ judgements. The cannot be _____ just by looking at ______

Answer 4

normative statements are subjective statements that carry value judgements. They cannot be refuted just by looking at evidence.

Question 5

value judgements is a ________ statement of _______ rather than a ______.

Answer 5

value judgement is a subjective statement of opinion rather than a fact.

Question 6

4 factors of production?

Answer 6

land
labour
capital
enterprise

Question 7

labour involves the _______ and ________ effort involved to ______ output

Answer 7

labour involves the physical and mental effort involved to producing output.

Question 8

capital is anything _______ to __________ production e.g; machinery.

Answer 8

capital is anything used to increase production e.g; machinery.

Question 9

human capital is the _______ and ______ workers have.

Answer 9

human capital is the knowledge and skills workers have.

Question 10

enterprise is an ________ or _______ prepared to take risks and combine the _______ of _______.

Answer 10

enterprise is an individual or group prepared to take risks and combine the factors of production.

Question 11

the central purpose of _________ activity is the ________ of goods/________ to satisfy ______ and ______.

Answer 11

the central purpose of economic activity is the production of goods/services to satisfy needs and wants.

Question 12

the _______ economic ________ is how _______ results from ______ resources and _______ wants.

Answer 12

the fundamental economic problem is how scarcity results from limited resources and unlimited wants.

Question 13

the fundamental economic problem (continued) is how best to make ______ about the ________ of ________ to maximise human _______.

Answer 13

the fundamental economic problem (continued) is how best to make decisions about the allocation of resources to maximise human welfare.

Question 14

the key economic decisions are?

Answer 14

what to produce
how to produce
whom to produce for

Question 15

economic welfare is the _______ of an _______ or ______ within society.

Answer 15

economic welfare is the well-being of an individual or group within society

Question 16

scarcity for individuals:
individuals have to ______ what to ______ and what not to ______ as they ______ meet all their _____ and ______ as they have _______ income.

Answer 16

scarcity for individuals:
individuals have to decide what to consume and what not to consume as they cant meet all their needs and wants as they have limited income.

Question 17

what is opportunity cost?

Answer 17

The cost of the next best alternative forgone

Question 18

production possibility diagrams illustrate resource ________ and opportunity ________

Answer 18

production possibility diagrams illustrate resource allocation and opportunity cost

Question 19

any point on a ppf curve is _________ efficient.

Answer 19

any point on a ppf curve is productively efficient.

Question 20

__________ efficiency is when the _______of goods and services best ______ peoples _____ and______.

Answer 20

allocative efficiency is when the combination of goods and services best matches peoples tastes and needs.

Question 21

________ is when a worker only _______ one or a ______ few tasks.

Answer 21

specialisation is when a worker only produces one or a narrow few tasks.

Question 22

division of ______ is when different workers perform _____ tasks while ______ a good or service.

Answer 22

division of labour is when different workers perform different tasks while producing a good or service.

Question 23

trade is the ______ and ______ of goods and services.

Answer 23

trade is the buying and selling of goods and services.