Unit 2: Introduction to Economics Review

Question 1

To distribute

Answer 1

allocate

Question 2

An economic school of thought focused on individualism. The belief is that each economic crisis is based on a new set of phenomena because each individual makes choices based on various outcomes

Answer 2

Austrian School of Economics

Question 3

Goods and services for which consumption is excludable and non-rivalrous

Answer 3

club goods

Question 4

A measure of the degree of optimism about the state of the economy

Answer 4

consumer confidence index

Question 5

An economy where the allocation of scarce resources, and the goods and services that the economy produces are determined by a government

Answer 5

command economy

Question 6

A situation in an economy where the output of producers is controlled by the wants and needs of consumers

Answer 6

consumer sovereignty

Question 7

A social scientist who studies the economy and develops and tests theories related to the economy

Answer 7

economist

Question 8

An individual who uses the factors of production to create goods and services

Answer 8

entrepreneur

Question 9

The inputs used in the production of goods or services

Answer 9

factors of production

Question 10

A tangible material or product that satisfies human wants and provides a benefit, or utility, that has a degree or scarcity

Answer 10

good

Question 11

A physical object produced for consumers to buy, such as food, clothing, or a video game

Answer 11

good

Question 12

The total monetary or market value of all the finished goods and services produced within a country’s border in a specific period of time

Answer 12

gross domestic product

Question 13

The knowledge and skills a worker gains through education and experience

Answer 13

human capital

Question 14

The rate at which the price of goods and services increase

Answer 14

inflation rate

Question 15

An economic theory developed by John Maynard Keynes that recognizes that immediate government intervention should be utilized in recessions to help consumers begin purchasing goods again

Answer 15

Keynesian theory

Question 16

An economic policy where the belief is there should be minimal or no government interference in economic affairs

Answer 16

laissez-faire

Question 17

Human-made objects used to create goods and services

Answer 17

physical capital

Question 18

The effort people devote to tasks for which they are paid

Answer 18

labor

Question 19

Quantities of productive resources available to the economy that are finite

Answer 19

limited resources

Question 20

The study of the economy as a whole

Answer 20

macroeconomics

Question 21

An economy where price signals resulting from supply and demand forces within the economy determine the goods and services that the economy produces

Answer 21

market economy

Question 22

The study of smaller parts of an economy, such as single firms

Answer 22

microeconomics

Question 23

An economy that blends the structure of a market economy and a command economy in order to allocate scarce resources and determine the goods and services produced within the economy

Answer 23

mixed economy

Question 24

An economic theory in which government intervention should focus on changes to the money supply in the economy to fight economic issues and inefficiencies

Answer 24

monetarist theory

Question 25

Also referred to as land resources are materials and substances found naturally in the environment; often used to create goods and services

Answer 25

natural resources

Question 26

The condition where everyone can compete in the marketplace and there are equal private property rights

Answer 26

open opportunity

Question 27

The value of the next highest-valued alternative use of the resource(s) that an individual, business, or government forgoes when deciding how to allocate resources

Answer 27

opportunity costs

Question 28

A curve that shows the various combinations of the amounts of two goods that can be produced with the given quantities of limited resources

Answer 28

production possibilities curve

Question 29

The financial gain or benefit from exchanges or investments within an economy

Answer 29

profit

Question 30

Determine ownership of resources among businesses, individuals and governments, and provide the foundation for how goods and services are exchanged in the market

Answer 30

property rights

Question 31

The problem of having fewer resoures than needed to fulfill human wants and needs; having limited resources and unlimited wants

Answer 31

scarcity

Question 32

Actions or activities that one person performs for another, such as medical care or haircuts

Answer 32

service

Question 33

An economic activity offered as a product that is not tangible, cannot be stored, and does not result in ownership

Answer 33

service

Question 34

An exchange or compromise in which you give up one thing in order to get something else that you also desire

Answer 34

trade-off

Question 35

An economy where traditions, culture, and beliefs determine the allocation of resources and the goods and services that the economy produces

Answer 35

Traditional economy

Question 36

The number or proportion of unemployed people in the economy

Answer 36

unemployment

Question 37

The percentage of people currently in the labor force that are unemployed

Answer 37

unemployment rate

Question 38

Consumers will always want more. There is always something else that a consumer will want or need.

Answer 38

Unlimited wants

Question 39

free market or capitalist economic structure where private businesses have the economic freedom to organize and operate for profit in a competitive system

Answer 39

US free enterprise system

Question 40

The condition where buyers and sellers willingly engage in market transactions, and the transactions leave both buyers and sellers better off

Answer 40

voluntary exchange