Term
| What are the factors of production? |
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Definition
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Term
| What is opportunity cost? |
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Definition
| The value of the next best alternative |
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Term
| What does it mean hen a country or entity has a comparative advantage? |
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Definition
| The country can produce more of a particular good at a lower opportunity cost than any other country or entity. |
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Term
| Which factor of production does a maching belong to? |
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Definition
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Term
If a country's production possibilities curve shifts outward, which of the following is true?
-It has underemployed resources.
-It has decreased production.
-It has increased its technology.
-It is experiencing inflation. |
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Definition
| The country has increased its technology. |
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Term
| What is the basic economic problem? |
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Definition
| Scarcity is caused by unlimited wants and limited resources. |
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Term
| How is the circular flow of economic activity in a factor market described? |
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Definition
| Households earn money in exchange for labor. |
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Term
| How is the circular flow of economic activity in a product market described? |
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Definition
| Households pay money to a firm in exchange for a good or service. |
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Term
| What does every choice create? |
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Definition
| An opportunity cost and benefit. |
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Term
| Suppose you can paint a room or walk backwards to the mall and back 5 times in 2 hours. Your friend can paint a room in 1 hour. In order for him to have a comparative advantage in painting a room, how many times must he be able to walk to and from the m |
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Definition
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Term
| Kelsey can eat 15 apples or peel 20 oranges in an hour. Ara can eat 30 apples or peel 25 oranges in an hour. Does Ara have an absolute or comparative advantage in both activities? |
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Definition
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Term
| In what kind of economy does the government decide how to use the factors of production? |
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Definition
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Term
| List the 5 economic goals. |
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Definition
| Efficiency, equity, security, freedom, and incentives. |
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Term
Which of the following is the regulating force of the market system?
-Government
-Firms and Taxes
-Suppliers and Consumers
-Government and Firms |
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Definition
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Term
| What do the plot points on the production possibilities graph represent? |
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Definition
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Term
| List the 6 determinants of demand. |
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Definition
| Income, Taste or preferences, the substitution effect, the price of complementary goods, populations, and consumer expectations. |
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Term
| When demand increases, what happens to a demand curve? |
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Definition
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Term
| What would happen to the demand curve for cars if the price of gasoline tripled? |
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Definition
| It should shift to the left because of price of the complementary good. |
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Term
| List the 6 determinants of supply. |
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Definition
| Input prices, Producers' Expectations, Technology, A change in the Price of Other Goods, The Number of Suppliers, and Government. |
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Term
| What does the law of supply state? |
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Definition
| As prices rise, quantity supplied rises. |
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Term
| On a supply curve, how are prices and quantity related? |
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Definition
| They are positively related. |
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Term
| Where is the price floor located? |
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Definition
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Term
| When the supply curve shifts right and the demand curve stays constant, what happens? |
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Definition
| Prices fall and quantity rises. |
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Term
| The area above the equilibrium, price is also known as... |
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Definition
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Term
| If Price increased by 5 percent and quanty supplied increased by 7 percent is supply elastic or inelastic? |
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Definition
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Term
| When income and consumption have a positive relationship is the good normal or inferior? |
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Definition
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Term
| When cross-elasticity of deman is positive, what are the goods in question? |
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Definition
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Term
| A tornado hits Kansas and wipes out Lauren's tomato crop. What effect will this have on the Kansas tomato market? |
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Definition
| Market prices will increase, and the quantity will decrease. |
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Term
| Mr. Sarquis has developed a new machinge that can recycle trash into fuel. Which of the following is most likely to occur as a result of this invention? |
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Definition
| The price of gasoline will decrease. |
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Term
If the price for hamburgers increases, which of the following is likely to occur?
-Fewer will be made
-More people will eat them
-People will be less likely to substitute them for hot dogs.
-Producers can make more. |
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Definition
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Term
A pharmaceutical company increases its prices for all of its medication and discovers that its total revenue increases. Which of the follwing best explainst his.
- Supply increased
-Production decreased
-Demand is elastic
-Demand is inelastic
-Suppl |
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Definition
| The firm has inelastic demand. |
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Term
| In an effort to increase consumptution, the government has increased the minimum wage. What has the government adjusted? |
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Definition
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Term
| When the government establishes an effective price ceiling on rent, what will be the result? |
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Definition
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Term
| What impact will a future sale on computers have on the demand for computers today? |
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Definition
| Shifts the demand curve to the left. |
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Term
| What happens to a product's price if a close substitute is developed? |
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Definition
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Term
Which of the following may have caused an increase in demand for oranges?
-Increase in price
-Decrease in price
-Decrease in the price of grapes
-Increase in the price of grapes.
-No change in the price of apple juice |
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Definition
| Increase n the price of grapes. |
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Term
Which one of the following may have caused an increase in supply of surfboards?
-Firberglass shortage
-Cheaper surfboards
-Increase in price of surfboards
-Decrease in price of surfboards
-Increase in the minimum wage |
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Definition
| Increase in price of surfboards |
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Term
| What happens if both supplly and demand increase? |
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Definition
| Prices will remain unchanged, and quantity will rise. |
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Term
Which of the following best illustrates a determinant of supply?
-A new machine has been developed to increase supply
-Firms profits increase
-Consumer spending falls.
-Consumers prefer apples to oranges.
-Average consumer income rises |
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Definition
| A new machine has been developed to increase production. |
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Term
Which of the following has the most value?
-Diamonds
-Water
-Home Computer
-Tickets to a Concert |
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Definition
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Term
| What type of economy is demonstrated when after hearing complaints about the postal service, Jack starts a delivery service? |
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Definition
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Term
| The law of supply states... |
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Definition
| The quantity supplied varies directly with its price. |
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Term
The federal debt impacts the economy in all of the following ways except:
-Reduces the purchasing power of the economy.
-affects the distribution of income.
-Affects the debt of individual citizens.
-Causes a rise in interest rates. |
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Definition
| The Federal debt does not affect the debt of individual citizens. |
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Term
| The dollar value of all final goods, services, and structures produced in one year with labor and property supplied by US residents is called the... |
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Definition
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Term
| Alpha can produce 10 apples or 3 oranges. Beta can produce either 12 apples or 3 oranges. Does Alpha have an absolute or comparative advantage in the production of apples. |
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Definition
| Beta has an absolute advantage. |
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Term
Which of the following about job categories is true?
-Professionals jobs require some training, often using Technology.
-Skilled workers have college degrees and often additional training.
-Semiskilled workers learned a trade or craft through vocationa |
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Definition
| Unskilled workers require no specialized training. |
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Term
| If your city made a trade-off to spend $1 million on a recycling facility instead of a fitness and health center, the opportunity cost of a cleaner environment would be... |
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Definition
| Fewer fit and healthy people. |
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Term
| What are the basic issues that every nation's economic system address? |
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Definition
| The types of goods and services that should be produced, how the goods and services should be produced, and who should share in what is produced. |
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Term
Which of the following would NOT be substitutes for each other if the price of one increased dramatically?
-Fitness center, exercise bike
-Broccoli, Pizza
-Home Perms, Salong Hair Styling
-Concert tickets, movie rentals |
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Definition
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Term
| Why is agriculture an example of perfect competition? |
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Definition
| Demand for some agriculture products, such as wheat is inelastic. |
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Term
| How has improved telecommunication affected global integration? |
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Definition
| Teaching people in developing nations about the rest of the worls, Spreading fads and fashions, Encouraging more of the world's people to learn English. |
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