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Honors Economics > The Economic Way of Thinking : 1/8/16 > Flashcards

The Economic Way of Thinking : 1/8/16 Flashcards

1
Q

Consumers have two basic desires. : 1. _____. 2. _____.

A

Wants, needs

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2
Q

_____ are desires that can be satisfied by consuming a good or service.

A

Wants

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3
Q

______ are things such as food, clothing, and shelter, that are necessary for survival.

A

Needs

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4
Q

_________ is the situation that exists when there are not enough resources to meet human wants.

A

Scarcity

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5
Q

___________ is the study of how people choose to use scarce resources to satisfy their wants. It involves : 1. Examining how individuals, business, governments, and societies chose to use s______ r_________ to satisfy their wants. 2. Organizing, analyzing, and interpreting d___ about those economic behaviors. 3. Developing t_______ and economic l____ that explain how the economy works and to predict what might happen in the future.

A

Economics, scarce resources, data, theories, laws

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6
Q

C_____ is central to the use of s______ r_________.

A

Choice, scarce resources

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7
Q

________, then, affects which goods are made and which services are provided.

A

Scarcity

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8
Q

______ are physical objects that can be purchased, such as food, clothing, and furniture.

A

Goods

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9
Q

_________ are work that one person performs for another for payment.

A

Services

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10
Q

________ is a person who buys goods or services for personal use.

A

Consumer

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11
Q

________ is a person who makes goods or produces services.

A

Producer

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12
Q

S______ requires every society to address three basic economic questions. : 1. W____ w___ b_ p_______? 2. H___ w___ i_ b_ p________? 3. F__ w____ w___ i_ b_ p________?

A

Scarcity, What will be produced?, How will it be produced?, For whom will it be produced?

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13
Q

This f____ f______________ e______ q______ involves not only ____ to produce but also ____ _____ to produce.

A

First fundamental economic questions, what, how much

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14
Q

Once decided, s_______ must then decide exactly how they are going to get these goods and services to people.

A

Societies

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15
Q

F_______ of p_________ are the resources needed to produce goods and services.

A

Factors of production

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16
Q

They divide the factors of production into four broad categories. : 1. L____. 2. L_____. 3. C______. 4. E_________________.

A

Land, labor, capital, entrepreneurship

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17
Q

All of these factors have one thing in common– their supply is _______.

A

Limited

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18
Q

L___ includes all the natural resources found on or under the ground that are used to produce goods and services.

A

Land

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19
Q

L_____ is all the human time, effort, and talent that go into the making of products.

A

Labor

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20
Q

C_______ is all the resources made and used by people to produce and distribute goods and services.

A

Capital

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21
Q

C_____ is all of the producer’s physical resources.

A

Capital

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22
Q

For this reason capital is sometimes called p______ c_____, or r___ c_____.

A

Physical capital, real capital

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23
Q

While businesses invest in r___ c______, workers in invest in h_____ c_____.

A

Real capital, human capital

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24
Q

H______ c_______ is the knowledge and skills gained through experience.

A

Human capital

25
Q

E______________, brings the other three factors together.

A

Entrepreneurship

26
Q

E______________ is the combination of vision, skill, ingenuity, and willingness to take risks that is needed to create and run new businesses.

A

Entrepreneurship

27
Q

E___________ are also risk takers. They risk their time, energy, creativity, and money in the hope of making a profit.

A

Entrepreneurs

28
Q

Factors that shape economic choice. : 1. I_______. 2. U____.

A

Incentives, utility

29
Q

I________ are methods used to encourage people to take certain actions.

A

Incentives

30
Q

U_____ is the benefit or satisfaction received from using a good or service.

A

Utility

31
Q

When people e_________, they consider both incentives and utility.

A

Economize

32
Q

To e_________ means to make decisions according to the beat combination of costs and benefits.

A

Economize

33
Q

Every choice involves _____.

A

Costs

34
Q

_____ can take the form of money, time, or something you value.

A

Costs

35
Q

T_____-___ do not require all or nothing choices, rather they involve giving up some of one thing to gain more of another.

A

Trade- offs

36
Q

O__________ c_____ of a decision is the value of the next best alternative, or what you give up by choosing one alternative over another.

A

Opportunity costs

37
Q

The practice of examining the costs and the expected benefits of a choice as an aid to decision making is called c___-______ _______.

A

Cost- benefit analysis

38
Q

C____- ______ _______ is one of the most useful tools for individuals when they need to evaluate the relative worth of economic choices.

A

Cost- benefit analysis

39
Q

The simplest application of cost- benefit analysis is the d________-________ ____.

A

Decision-making grid

40
Q

The d_________-_______ ___ shows what you get and what you give up when you make choices.

A

Decision-making grid

41
Q

C____ and b_______ change over time as do g____ and c_____________.

A

Costs, benefits, goals, circumstances

42
Q

The analysis of m________ c_____ and m_______ b_______ is central to the study of economics.

A

Marginal costs, marginal benefits

43
Q

M_______ _____ is the additional cost of using one more unit of product.

A

Marginal cost

44
Q

M_______ _______ is the additional satisfaction from using one more unit of a product.

A

Marginal benefit

45
Q

The P_________ P_________ F_______ (?) is a graph used by economists to show the impact of scarcity on an economy.

A

Production Possibilities Frontier (PPF)

46
Q

The PPF is based on assumptions that simplify economic interactions. : 1. Resources are f____. 2. All resources are f_____ e______. 3. Only ___ things can be produced. 4. T__________ is f_____.

A

Fixed, fully employed, two, technology, fixed

47
Q

C______ p______ is a Latin phrase used in economics to meaning all other things being held equal or constant.

A

Ceteris paribus

48
Q

The ___ represents the b_____– or f_____– between what it is possible to produce and what is not possible to produce.

A

PPF, border, frontier

49
Q

The ___ shows the opportunity costs of each choice in a v_____ way.

A

PPF, visual

50
Q

Anything ______ the curve is an _________ use of resources. A point __ the curve is an ______ use of resources. Anything ______ the curve is ___________.

A

Inside, inefficient, on, efficient, outside, impossible

51
Q

E_________ is the condition in which economic resources are being used to produce the maximum amount of goods and services.

A

Efficiency

52
Q

U______________ is the condition in which economic resources are not being used to their full potential.

A

Underutilization

53
Q

The _____ of the ____ shows a third important economic concept.

A

Shape, PPF

54
Q

The l___ of i_________ o__________ c____ states that as production switches from one product to another, increasing amounts of resources are needed to increase the production of the second product.

A

Law of increasing opportunity costs

55
Q

The ___ illustrates a country’s p______ p_______ p__________ as if all resources were f____.

A

PPF, present production possibilities, fixed

56
Q

Anything that causes economic output to increase or decrease will _____ the curve.

A

Shift

57
Q

Things that would make the PPF shift ______. : 1. E________ g_____. 2. T_________.

A

Outward, economic growth, technology

58
Q

Things that would make the PPF shift ______. : 1. N______ d______. 2. W__/ p_____.

A

Inward, natural disaster, war, plague

Honors Economics (6 decks)

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