Wants and Needs
Factors of Production
Opportunity Cost and Trade Offs
Marginal Thinking and Cost Benefit
PPC Graphs
100
Because water is necessary for survival, it is considered a what?
A need.
100
What are the four factors of production?
Land, labor, capital, and entrepreneurship.
100
If you choose to study for a test instead of sleeping, what is your opportunity cost?
Sleeping
100
What is “thinking at the margin”?
Deciding how much more or less to do of something.
100
What does a point on the production possibilities curve represent?
An efficient use of resources
200
Which of the following is considered a want: food, entertainment, shelter, or clothing?
Entertainment
200
Which factor of production is a human-made resource used to produce goods?
Capital
200
What is a trade-off?
Giving up one benefit to gain another.
200
What is marginal cost?
The extra cost of doing one more of something.
200
According to the graph, if the economy makes 0 robots, how much wheat can it produce?
16 units of wheat
300
What is the difference between a good and a service?
A good is a physical product useful to others; a service is work done for someone.
300
If someone works as a bagger at Kroger, he/she is providing which factor of production?
Labor
300
What is opportunity cost?
The cost of the next best choice.
300
What is marginal benefit?
The extra benefit of doing one more of something.
300
What happens when the economy moves from producing 1 robot and 15 wheat to 2 robots and 13 wheat?
It gives up 2 wheat to produce 1 more robot — showing opportunity cost.
400
What is economics?
The study of how people satisfy their needs and wants by making choices.
400
What is human capital?
Any training or education that people have.
400
What trade-off do governments face that is nicknamed “guns vs. butter”?
Military vs. domestic needs.
400
How can a cost-benefit analysis help decide between two choices?
By weighing the pros and cons to make the best choice.
400
Could the economy produce 5 robots and 16 wheat at the same time? Why?
No, because it’s above the curve and would require economic growth
500
What is a shortage?
When consumers want more of an item than producers are willing or able to make at a particular price.
500
Which factor of production shows risk-taking to earn profits?
Entrepreneurship
500
What is the law of increasing opportunity costs?
Opportunity costs increase when switching production from one item to another.
500
What happens when marginal cost equals marginal benefit?
That is the amount of something a person wants to do.
500
What is the opportunity cost of increasing robot production from 3 robots to 4 robots?
4 units of wheat — it drops from 10 wheat to 6 wheat