Positive/Normative
What branch of economics focuses on describing economic statements in an objective way that can be backed up by evidence
Positive Economics
Give a simple definition of opportunity cost.
The real cost of giving something up is what you have to give up to get it, monetary or opportunity.
What is the factor of production that includes natural resources?
Land
What is a model that shows the maximum combination of two goods at a given point in time?
Production Possibility Curve
True or false: Utility maximization means that consumers choose the combination of goods that gives them the least satisfaction.
False
What is the branch of economics that includes value-based claims?
Normative Economics
What is society’s choice?
The sum of all individual choices.
What is the factor of production that involves the exertion of effort and the physical and mental effort people contribute?
Labor
What does the slope or line of the PPC represent?
Oppurtunity Cost
Define Utils as a measurement?
Utils are an imaginary unit of satisfaction that you have for something.
Do positive or normative statements help predict and explain world events using facts?
Positive
What makes a resource scarce?
The demand is greater than the amount of the resource.
What are the two different types of capital?
Physical (anything man-made) and Human (skill/idea)
What does a point within the slope represent?
Inefficiency
In the context of diminishing marginal utility, do you want more or less of something as you get more of it?
Less
What word is used to describe the assumption that all other things are equal ___ is better?
Ceteris Paribus
Scarcity is present in all societies even wealthy ones because this can never be unlimited?
Resources
Starting the business for cutting trees would be what type of resource or factor of production?
Entrepreneurship
How can a country expand its production past the PPC?
Specialize in a specific good or trade with another country
In a circular flow model, businesses receive revenue in return for selling _____ and ________ to consumers.
Goods and Services
What economics branch avoids using words like “should” or “ought to”?
Positive Economics
If a country can produce 3 books and 400 ears of corn at point A, and 4 books and 200 ears of corn at point B, what is the opportunity cost of 1 book?
200 corn/1 book = 200
What can be considered as the 5th additional factor of production?
Technology
What does a shift to the right represent in a PPC?
Economic Growth
In the product market of a circular flow market, how do goods and services flow, and how does money flow?
Goods and services flow from businesses to households, and money flows from households to businesses.