Scarcity
Define scarcity
Having unlimited wants with limited resources.
When should you stop hiring workers?
When the marginal cost and marginal revenue are the same.
Define specialization
Concentrating your skills on one task, job
This type of economic system has government involvement with private ownership.
Mixed economy
Give an example of how the government redistributes income.
Transfer payments
Social Security
Unemployment
How would you improve our healthcare system?
Lower costs
Choice of doctors
What would be the opportunity cost of choosing Pepsi over Coke as your soft drink supplier?
Could have Powerade
May lose customers
A negative incentive of opening up a new business.
Traffic
Crime
Closing of existing businesses
Gentrification
Why does Hollywood specialize in entertainment?
Answers will vary
What are some characteristics of a market economy?
Private ownership
Profit motive
Competition
Trademark
Patent
Copyright
A point inside the PPC is called
Underutilization
What are the factors of production?
Land, Labor, Capital, Entrepreneurship
A positive incentive of having a new hospital in your neighborhood.
Another way to treat patients
C
Countries only trade with each other when
they have the comparative advantage
The government answers the three basic economic questions in this economy.
Command economy
What should the government do to resolve the market failure of affordable housing?
Price controls
Job creation
Investing in technology and equipment will lead to
economic growth
jobs
lower prices
Give an example of human capital
Going to college
Learning a new skill
Define marginal benefit
The benefit of adding one more of something (worker, dollar, building, etc.)
Separating tasks in the process of production ans assigning different tasks to different workers (assembly line)
division of labor
These types of economies are rare in the world. Built off of customs and tradition. People barter instead of use money to exchange goods and services.
Traditional economy
If the government regulated the Internet more, what could happen?
People would not use the Internet
Use the money to help the country
A production possibilities curve shows the different ways that you can use limited resources for how many products
2
If you are deciding between using Coke and Pepsi as your soft drink supplier and you choose Pepsi. What would be the tradeoff?
Coke would be the trade off.
Define marginal cost
The cost of adding one more worker, building, dollar, etc.
The act of buyers and sellers freely and willingly engaging in market transactions
Voluntary exchange
Compare and contrast a command and market economy
Command - equity, government ownership, no profit motive, lack of economic freedom
Market - profit motive, private ownership, economic freedom
If the country deregulated recreational drugs, what would be the impact.
Less people in prison or jail
Law enforcement can specialize in other major crimes
Decline in regulation drug use
A point outside of the PPC is called
Impossible