PPC
All points inside the curve of the PPC
attainable - possible
What are the two economic agents that are part of the circular flow of income?
households and firms
unlimited wants and limited resources, scarcity
the basic economic problem
Income after taxes have been subtracted
disposable income
Which of the following is a service?
a. phone
b. haircut
c. puzzle
d. pizza
haircut
What can be seen once in a minute, twice in a moment, and never in a thousand years?
the letter m
A firm can produce 50 of good x and 80 of good y, or 60 of good x and 75 of good y. What is the opportunity cost of producing 10 more units of good x?
5 units of good y
Where households go to purchase products
the product market
The factor reward for capital
interest
When income = expenditure in a household's budget
balanced budget
Formula for calculating compound interest
Two boxers are scheduled for a 12 round match. After 6 rounds, oneof them is knocked out, yet no man threw a punch. How is this possible?
the boxers are women
no - you can improve technology or the factors of production
Owners of the factors of production
Households
The cost of the next best alternative foregone
opportunity cost
How does inflation decreases a household's ___________ __________.
purchasing power
Name 2/4 reasons that people save
for future consumption, interest rates, consumer confidence, availability of savings schemes
What is not alive, but still has 5 fingers? Hint: It is not a dead body
a glove
If a country invests in renewable energy infrastructure, how will this affect the PPC?
outward shift (because of technological progress)
Households provide labor, land, capital, and enterprise on the __________ ___________.
factor market
A good that is limited (if I consume it, you cannot also consume it)
economic good
A young adult decides to save more after receiving news about rising unemployment. Which factor affecting the level of consumer expenditure is influencing their decision?
A farmer is deciding whether to convert a large field of wheat into land for building rental houses. Which factor of production is changing use, and what type of reward would the farmer hope to receive from this new use?
Land - Rent
You see a boat filled with people. It has not sunk, but when you look again you don't see a single person on the boat. Why?
A natural disaster destroys 25% of the farmland in an economy. How does this affect the PPC for apples and butter?
It shifts inwards
A firm that produces handbags will get leather to this product from where?
the factor market
incentive
A household budget shows that expenditures have risen faster than income due to higher food and energy prices. What has happened to the household’s purchasing power?
purchasing power decreased
Households spend more when interest rates are low. Which explains this concept best?
a) Borrowing becomes cheaper
b) Savings earn more rewards
c) Wages increase
d) Firms produce more goods
a) Borrowing becomes cheaper
How can the number 4 be half of five?
IV, the roman numeral four, is "half" (two letters) of the word five.