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ECON 104: EXAM 1
In economics the pleasure, happiness, or satisfaction received from a product are called __________. |
Utility |
An __________ ___________ is the cost associated with the alternative that was sacrificed to do or acquire something else. It is the cost associated with the foregone opportunity. |
Opportunity cost |
The study of economics is primarily concerned with what? |
Choices that are made in seeking to use scarce resources efficiently. |
The ___________ ____________ entails a comparison of marginal benefits and marginal costs in decision making. |
Economic Perspective |
A well tested and widely accepted theory is referred to as a law or principal. An economic generalization which is based on economic laws or principals implies what? |
The greatest degree of confidence in outcome. |
The term __________ __________ means "other things equal" |
Ceteris Paribus |
Full employment, price level stability, and economic growth are widely accepted _____________ ___________ goals in the U.S. |
Macroeconomic Goals |
_______________ can best be described as the study of the large aggregates of the economy or the economy as a whole. |
Macroeconomics |
_______________ is concerned with individual economic units in a specific market. |
Microeconomics |
_____________ ______________ Should be the basis for determining wether or not a good, or service is produced. Even inherently desirable products, such as education, and health care, should be produced when the marginal benefits of production no longer outweigh marginal costs. |
Marginal Analysis |
_____________ ___________ is one of deciding how to make the best of limited resources to satisfy virtually unlimited wants. |
Economizing Problem |
The four factors of production are: |
Land, labor, capital, and entrepreneurial ability |
Productive efficiency refers to the use of what? |
Least cost method of production. |
To reach full production a society must achieve both ___________ and ___________ efficiency . |
Allocative and Productive |
The __________ ___________ curve illustrates the basic principal that if all the resources of an economy are in use, more of one good can be produced only if less of another good is produced. |
Production Possibilities Curve |
Unemployment and or productive inefficiencies are both illustrated by a point inside the production ____________ ________. |
Possibilities Curve. |
A productions __________ ________ shows that the maximum amounts of two goods that can be produced assuming the full and efficient use of available resources. |
Possibility Curve |
The process of producing and accumulating capital goods is called ___________. |
Investment. |
Devastation from a war may shift a nations production possibility curve _________. |
Inward |
The simple circular flow model shows that households are on the __________ side of the resource market, and on the ___________ side of the product market. |
Selling, Buying |
The relationship between quantity supplied and price is ________. |
Direct |
The relationship between quantity demanded and price is ________. |
Inverse. |
A change in price in K will cause a change in _________ _________ of K. |
Quantity Demanded |
A change in the price of K will not cause the demand for a product, K to _________ or _______. |
Shift or Change. |
An increase in the __________ __________ means that price has declined and consumers therefore want to purchase more of the product. |
Quantity Demanded |
The ________ of _________ indicates that producers will offer more of a product at a higher then they will at a lower price. |
Law of Supply |
A __________ shift of the supply curve might be caused by some firms leaving an industry. |
Leftward |
If Z is an inferior good, a _________ in income will shift the demand curve for Z to the right. |
Decrease |
Characteristics of the market system: |
Private Property, Freedom of Enterprise, and Competition in product and resource markets. |
___________ ownership of major industries is not a characteristic of the market system. |
Government |
To _________ the amount of capital goods in a full employment, full production economy, society must decrease consumption. |
Increase |
The ________ of _________ problem associated with barter refers to the fact that for exchange to occur each seller must have a product that some buyer wants. |
Coincidence of Wants |
A firms ________ ________ is profit over and above that which it needs to reasonably compensate for the time and other resources the owner supplies to the business |
Economic Profit |
From societies point of view the economic function of ________ and __________ is to constantly relocate resources from less desired to more desired uses. |
Profit and Losses |
The market systems answer to the fundamental question "How will the goods and services be produced?" is essentially ".....". |
"At least cost production". |