Unit 1! Econ Flashcards

1
Q

What is Economics?

A

The study of how people satisfy their needs and wants.

Money/ bartering

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2
Q

What is the difference between goods and services? List some of each.

A

Goods are physical objects such as:

Computers
Sneakers
Cars

Services are actions that a person performs for another person.

Teaching
Cleaning
Fixing my car

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3
Q

What is the difference between wants and needs? List some of each.

A

Needs are the things that a person has to have to survive.
Food
Water
Shelter

Wants are those things that you would like, but do not need to survive.

Ex. Car
I-Pad
Concert Tickets

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4
Q

What is Scarcity? Why do we have scarcity?

A

Def. A limited amount of resources to meet unlimited wants and needs.

We have Unlimited Wants and Needs But Limited Resources Create Scarcity. So we need to make Choices
What to produce, How to Produce, For Whom to produce

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5
Q

What is a traditional economy?

A

Economic questions are answered by habits and customs (the way it has always been done)

Children work the same jobs parents worked, often farming or hunter/gatherer

Fear Change!

Ex. Eskimos, the Amish

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6
Q

What is a command economy?

A

The government answers the basic economic questions

Ex. Communist Countries (China, Vietnam, North Korea, former
Soviet Union, Cuba)

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7
Q

What is a market economy?

A

Economic questions are answered by individual buyers and sellers.
Supply and demand influence economy.

People act out of self interest; motive for profit (money) drives the economy

Also known as FREE ENTERPRISE or CAPITALISM**

Ex. The United States, Western
Europe, Japan

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8
Q

What is a mixed economy?

A

No economy is pure market, pure command or pure traditional, elements of each appear in all economies, some have more elements of one economy than another.

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9
Q

What kind of economy is the United States currently?

A

The United States is mostly a free market economy, it does have elements of a command economy.

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10
Q

Give an example of the U.S. as a market economy.

A

Economic Freedom: individuals have the right to choose

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11
Q

Give an example of the U.S. as a command economy.

A

Government regulation of some business practices

Ex. Wages, labor hours,
safety practice.

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12
Q

How is competition beneficial (good) to consumers (us)?

A

Competition: more than one producer of good/services insures choice

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13
Q

What are trade offs?

A

When you choose between two possible uses for a resource, giving up one alternative for another.

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14
Q

What are opportunity costs?

A

The value of time, money, goods, and services given up in an economic choice. The #1 alternative is the Opportunity cost.

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15
Q

What are Human Resources? Give an example.

A

A person’s knowledge, skills, attitudes and abilities determine that individual’s value as a human resource. The more rare the skill, knowledge etc. the more valuable and higher pay.

Ex. Unskilled workers- low pay
Teachers- high level of education, higher pay
Doctors- a lot of education and rare skills, well paid
NFL quarterbacks- rare physical abilities, very well paid

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16
Q

What are Natural Resources? Give an example.

A

Raw materials from which goods and services are made.

Land
Timber
Oil

17
Q

What are Capital Resources? Give an example.

A

Money and property used to produce goods and services

Tools
Buildings
Machines

18
Q

What are the 3 causes of scarcity?

A
  1. Personal Perspective: your own feelings of what is needed or wanted.

“I’m starving!”
“I’m broke!”

  1. Poor Distribution of Resources: not using your resources to their potential.

“I never have any time- yet I watch 6 hours of television a day!!”

  1. Rapid Increase in Demand: A sudden rush to use resources can cause a shortage.

Electronics

19
Q

List a trade off and opportunity cost you have dealt with recently.

A

Trade off: Less sleep for a higher grade on a test

Opportunity cost: time spent studying

20
Q

What are the 3 solutions to scarcity?

A

1.Doing without something

“Shut up kid- you’ll get nothing and like it”

  1. Creating more resources

“I’ll get a second job”

  1. Making better use of our resources

“While I watch television, I’ll grade papers”