Unit 1A

Question 1

a social science studying the allocation of scarce resources and goods

Answer 1

economics

Question 2

in short supply and wanted

Answer 2

scarce

Question 3

exists when unlimited wants exceed limited productive resources

Answer 3

scarcity

Question 4

the more a consumer is willing and able to pay for the product, the more he is likely to get it. If resources are really scarce, this will go up. Most utilized method in our economy and the free market

Answer 4

price

Question 5

what most people vote for decides who gets the resources. this can take advantage of minorities

Answer 5

majority rules

Question 6

everybody gets some
ex. a command economy and kindergarten

Answer 6

sharing

Question 7

whoever wins the contest gets the resource

Answer 7

contest

Question 8

whoever wins the drawing gets the stuff, total chance

Answer 8

lottery

Question 9

whoever is strong enough, takes the stuff they want
ex. a society without police

Answer 9

force

Question 10

whoever is in charge decides how the resources are distributed
ex. absolute monarch or dictator

Answer 10

authority

Question 11

you show up first and you get it

Answer 11

first come first serve

Question 12

those who have a certain trait get the resource
ex. a teacher giving all the good grades to blue-eyed students

Answer 12

personal characteristics

Question 13

the inputs (land/natural resources, labor, capital, and entrepreneurship) used to produce outputs

Answer 13

productive resources or factors of production

Question 14

society’s limited natural resources
ex. vegetation, animal life, climate, and time

Answer 14

land

Question 15

include labor and human capital

Answer 15

human resources

Question 16

HUMAN workers employed by entrepreneurs to apply their skills, efforts, and abilities to produce

Answer 16

labor

Question 17

the knowledge and talents of laborers
ex. a business pays for an employee’s health insurance, tuition to go back to school, training, or time off
ex. an individual attends college to acquire skills that will help him in the future

Answer 17

human capital

Question 18

includes the man-made tools, equipment, factories or other manufactured goods used to produce other goods or services

Answer 18

physical capital

Question 19

risk-takers who combine the land, labor, and capital into new products. Their main reason is to earn a profit. they innovate, create jobs, pay wages, and improve society

Answer 19

entrepreneurs

Question 20

using resources that could postpone immediate benefit for the purpose of gaining greater benefit over time

Answer 20

investment

Question 21

the level of wealth, comfort, material goods, and necessities available to an individual

Answer 21

standard of living

Question 22

is the most important thing for economic growth and standard of living for individuals, businesses, and governments

Answer 22

increasing human capital

Question 23

investment in - is also essential to increasing economic growth and productivity

Answer 23

physical capital and technology

Question 24

a person is called - if they are actively looking for a job

Answer 24

unemployed

Question 25

output / input

Answer 25

productivity

Question 26

standard of living increases when individuals, businesses, and governments -, concentrating on a single area of expertise

Answer 26

specialize

Question 27

focus in a specific area allows more efficient production due to the devotion of resources such as - entirely to that area

Answer 27

physical and human capital

Question 28

companies are able to make products - and individuals are able to perform occupations with more competence when they utilize specialization

Answer 28

better, cheaper, and faster

Question 29

manufacturing process often assigned to different people in the production of one item

Answer 29

division of labor

Question 30

manufacturing process in which parts are added progressively through different workstations until the final assembly is produced

Answer 30

assembly line

Question 31

choosing to trade out goods or services for something else of value

Answer 31

voluntary trade

Question 32

forces the use of voluntary exchange because one is not able to produce everything wanted or needed because of his specific task

Answer 32

specialization

Question 33

voluntary exchange is beneficial to the parties that use it as long as it is - (both parties are honest in what they are trading)

Answer 33

non-fraudulent

Question 34

the next best alternative: the main thing you give up when choosing something else

Answer 34

opportunity cost

Question 35

forces individuals, businesses, and governments to experience an opportunity cost when they make a decision

Answer 35

scarcity

Question 36

the cost of getting one more item ex. taco palace tacos are $1

Answer 36

marginal cost

Question 37

the benefit associated with procuring one more item

Answer 37

marginal benefit

Question 38

when the marginal benefits of an action equal or exceed the marginal cost

Answer 38

rational decision

Question 39

when the marginal costs outweigh the benefits

Answer 39

irrational decision

Question 40

the sum of all costs of a firm when producing an output. includes both variable and fixed cost ex. wages, rent, utilities, machinery costs, etc.

Answer 40

total cost

Question 41

total cost of production divided by quantity produced ex. apple spends $5000 making 10 phones, making each phone $500 to produce

Answer 41

average total costs

Question 42

costs not dependent on the quantity of a good that is produced ex. apple has to pay property taxes, rent, insurance, etc.

Answer 42

fixed costs

Question 43

a corporate expense that changes in proportion to the amount a company sells or produces ex. apple has to pay for raw materials, delivery expenses, and worker wages

Answer 43

variable cost

Question 44

due to -, the cost of production of an additional item (marginal cost) will change as quantity produced changes ex. apple may have to charge more to make an additional phone because it will need to go in an additional shipment or need new machinery to make

Answer 44

variable costs

Question 45

the total amount of income generated by sales

Answer 45

revenue

Question 46

the amount of income generated by one additional item. it may decrease if a company over produces and has to lower its prices

Answer 46

marginal revenue

Question 47

total revenue minus total cost

Answer 47

profit

Question 48

profit is maximized when a company makes wise decisions regarding their -

Answer 48

marginal revenue and marginal costs

Question 49

Homer should hire 3 employees because after 3, the - to hire a worker is more than the - the worker creates. It's the rational decision, because 3 workers maximize his profit

Answer 49

marginal cost; marginal revenue

Question 50

in order to grow, businesses and governments must make wise decisions about -

Answer 50

allocation of resources

Question 51

a - depicts how much of a particular product can be produced given the limited number of resources at a company's disposal

Answer 51

production possibilities curve

Question 52

the line on the graph represents the full potential (aka -) when the economy employs all of these productive resources

Answer 52

the frontier

Question 53

identifying the - allows an economy to examine how it can best put its limited resources into production

Answer 53

possible alternatives

Question 54

an economy pays a high cost if any of its resources are -. it cannot produce on its frontier and it will fail to reach its full production potential. the economy's standard of living would be lower

Answer 54

idle

Question 55

points inside the PPC represent an - use of resources ex. the economy may be characterized by high unemployment, workers spending too long on breaks

Answer 55

inefficient

Question 56

points outside the PPC are - because resources are not currently available

Answer 56

impossible

Question 57

economic growth is made possible by -, a larger labor force, or an increase in education causes a new frontier for the economy. the curve shifts outward

Answer 57

more resources

Question 58

an - means more production and a higher standard of living for an economy or more profit for a company

Answer 58

outward shift