Handy Dandy
The reason we need to choose
What is scarcity?
diminishing margin utility (DMU) defined
What is I enjoy the next time i do something less than before?
The PPC (production possibility curve) shows this
What is a tradeoff?
When the people own the factors of production
What is Capitalism?
When the great leader says all of the goods and services first go to the state
What is For whom to produce?
The reason there is no free lunch
What is Opportunity Cost?
The decision rule
What is IF MB>MC, do it?
Determines what gets produced in a capitalistic society
What is the price signal?
Command, Free Market, Mixed, or Traditional Economy? Examples are Brazil, Mexico, and Canada.
What is a Mixed Economy?
Only people with money can enjoy expensive TVs
How do we know who gets to consume it?
If you don't pay your taxes you will be fined
What is incentive?
When I still like to play a video game but enjoy the next video game i play less than the previous one
What is diminishing utility?
focusing on producing specific goods or services, encourages trade between countries because it allows different countries to focus on different products.
What is Specialization?
Which economic system? All people equally own all of the factors of production
What is Socialism?
The people with the Soviet Union, from an economic perspective, was the loss of the pricing signal
How do we know what (or how much) to produce?
Mr. Manziano violates this principle when he quickly decides to buy the first thing he sees on the lunch line
What is the consequences of our choices lie in the future?
work done by people
What is Labor?
Who determines price in a perfect competition market?
What is the interaction of buyers and sellers?
Allocation of resources is based on rituals, habits, or customs Roles are defined by family People work together for the common good but there is often little individual choice
What is a Traditional Economy?
The decision to make it locally or outsource or buy it
What is How to produce?
Even if I already spent $1 million on a project, i should not spend any more if i don't think it will pay
What is a sunk cost?
What is the ability to raise financial capital in order to pick and determine the amount and factors of production to make a good/service called?
entrepreneurial skill
The expenditure components to GDP
What is C + I + G+ Xn?
A greater, but not total role for government, than in a free market economy
What is a Mixed Economy?
The guns versus butter question
What is What to produce?