Core Principles
Markets
Planned vs. Free
Miscellaneous
100
The true cost of something is what you give up to get it. In other words, its ____________.
Opportunity Cost
100
The amount paid by a buyer to a seller for a product.
Price
100
China in the 1970’s was a __________ economy, but today it is a mix of ___________ and __________.
planned, planned, free market
100
The opportunity cost of going to university is what you pay for tuition, books, housing, etc. plus _______________ .
The value that could have been obtained from a job, travel, etc.
200
We use candy as a prize because people respond to ____________.
Incentives.
200
A seller needs the price to be higher than its ____________________.
Cost
200
Companies in free markets tend to be more efficient and have more new ideas because profits provide an I_________ to improve.
Incentive
200
____________ means that needs and wants are infinite, while resources are finite.
Scarcity
300
A decision may help some _________ while hurting others.
Stakeholders
300
A buyer needs the price to be lower than its ____________________.
Value / benefit
300
Planned economies are good at shifting resources to S_________ I__________ .
Strategic Industries
300
Company owners, employees, and local communities are _____________ in the decision to close a factory.
Stakeholders
400
Markets tend move toward a balance, or ___________________.
Equilibrium
400
In the Widget market, the ____________ price was 5 and the __________ quantity per day was 15.
equilibrium
400
[Everybody plays] Even in the freest economies, governments need to sometimes intervene. Two examples are : ____________________________________.
Regulating pollution; supporting citizens who cannot work; building infrastructure; others possible
400
In any model, answers depend on assumptions. “_________ in _______ out.”
Garbage
500
Politicians tend not to consider the ________ _________ of their decisions.
Unintended consequences
500
According to Adam Smith, market efficiency is achieved automatically by the I_________ H_________.
Invisible hand
500
In every Communist country, concentration of economic power led to C___________ and T___________.
Corruption / Tyranny
500
Friedrich Hayek believed that P____________ rights are crucial for preventing tyranny.
property
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