UNIT 1: Intro to Economics and Microeconomics

Question 1

Microeconomics

Answer 1

Focuses on individual decision-making units and how they interact.

Question 2

Macroeconomics

Answer 2

explore the economy as a whole

Question 3

Scarcity

Answer 3

Fixed (or limited) amount of goods and services available

Question 4

Traditional economy

Answer 4

economic system in which traditions, customs, and beliefs shape the outcome of the economy.

Question 5

Market economy

Answer 5

economic system in which supply and demand determine what goods and services are produced.

Question 6

Command economy

Answer 6

economic system where the government controls productions and economic activity.

Question 7

Mixed economy

Answer 7

an economy that holds characteristics of both command and market economies. (Supply and demand are determined by the people as long as they meet govt. goals)

Question 8

Opportunity cost

Answer 8

Cost of choosing what you give up by choosing one option.

Question 9

Goods

Answer 9

Objects that can fulfill human wants/needs, provide utility.

Question 10

Services

Answer 10

Economic activity that is intangible; provides utility but cannot be stored.

Question 11

Endowment

Answer 11

natural and human resources; all human resources must be produced

Question 12

Utility

Answer 12

Satisfaction; economics assume maximum this drives individual choices

Question 13

Profit motive

Answer 13

tendency that leads to monetary gain in people

Question 14

Consumer sovereignty

Answer 14

the economic power of the individual in a free market

Question 15

Government regulation

Answer 15

requirements government places on private firms and individual for their goals

Question 16

Marginal utility

Answer 16

additional increment of utility associated with consuming one more unit of a good or service.

Question 17

Margin

Answer 17

a succession of units, the specific unit you are focusing on

Question 18

Total utility

Answer 18

the total satisfaction from consuming a specific quantity of goods or services.

Question 19

Satiate

Answer 19

Satisfy

Question 20

Initial decision

Answer 20

over simplified decision-making process based on units.

Question 21

Bliss point

Answer 21

maximization of utility

Question 22

Marginal analysis

Answer 22

evaluating the impact of one additional unit

Question 23

Util

Answer 23

a measure of utility

Question 24

Diminishing marginal productivity

Answer 24

initially, one input increases the initial successive units of information toward the output, but eventually, this will add to less output

Question 25

Balancing at the margin

Answer 25

maximizing utility in light of scarcity

Question 26

Discounting the future

Answer 26

utility diminishes the utility diminishes the further in the future that utility is realized

Question 27

Social and economic goals

Answer 27

freedom, security, equity, growth, efficiency, and stability.