Introduction to Economics
In a command economy, who or what makes all the decisions?
Government
What type of market structure is characterized by a few large sellers that dominate the market and high barriers to entry?
Oligopoly
What is a property tax?
A tax on personal property and based on the value of that property such as a car, business, or home.
What is a recession?
Two or more quarters of a reduction in GDP
What does it mean that a currency is appreciating?
What is a public good?
Good or service provided by the government and is non-exclusionary.
What is a price floor?
A price set by the government that is the minimum that can be charged.
What is life insurance?
Insurance given to your family in the event of your death for funeral expenses and to set them up financially for some time.
Someone who is seasonally employed is...
Only employed during certain times of the year.
What is a fixed exchange rate system?
One that is set by the government.
What do we call your next best alternative when making a decision?
Opportunity cost
What makes a product elastic in terms of demand?
If there are no real substitutes and if the purchase of the product is necessary or can be delayed.
Under the 50/30/20 rule for budgeting, that 50% of your income should go to what?
Fixed expenses such as your rent/mortgage, car payment, insurance, etc.
Which government entity is in charge of monetary policy?
Federal Reserve
What is the difference between absolute and comparative advantage?
Absolute means simply that one country can outright make more of a good than another country, while a comparative advantage is based on who has the lowest opportunity cost.
Any point beyond the production possibilities curve is what?
Impossible with given resources
The circular flow model studies the relationship between who or what?
Households and businesses
The principle for your savings account is what?
The amount that you put in.
What is inflation?
Rise in prices over time.
A tax on imported goods is known as what?
A tariff
What is the fundamental problem in economics?
Scarcity
What is the difference between a change in demand and a change in the quantity demanded?
A change in the quantity demanded is caused by a change in the price, whereas a change in demand is caused by anything else and shifts the curve.
What is identity theft?
Crime committed when someone steals your personal information and uses it to hurt you financially.
What do we study in macroeconomics?
The economy of countries.
Why do economists believe trade is good?
Trade allows every country to specialize and use their resources more efficiently on the things that give them the least opportunity cost and import anything else they need?