Back to Basics
Market Magic?
It's a Small World
Potpourri
Economists do it w/ Models
100
What is the basic economic problem? (1 word)
Scarcity
100
North Korea is an example of this kind of economic system. Name the system.
Command Economy.
100
Which of the following has a Command Economy? Nigeria? Cuba? India? Singapore?
CUBA
100
Which famous economist said: "It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.”
Adam Smith
100
Matteo can harvest 50 peas and 20 carrots in one season whereas Miranda can harvest 65 peas and 15 carrots in one season. Who has the absolute advantage in which product?
Miranda has absolute advantage in peas and Matteo has absolute advantage in carrots.
200
When you acquire more of one thing at the expense of another, this is referred to as a __________
Tradeoff
200
What's an advantage of living in a traditional economic system?
Clearly defined roles in the social structure, social cohesion, less materialistic, less stress, more "sustainable" in apocalypse and more environmentally friendly, possibly others
200
Which country's currency is called the "Quetzal"?
Guatemala
200
Name 5 of the 10 world's biggest economies.
USA, CHINA, JAPAN, GERMANY, UK, INDIA, FRANCE, ITALY, BRAZIL, CANADA
200
What's the difference between absolute and comparative advantage?
Absolute advantage is about inherent productivity, whereas comparative advantage is about relative productivity (in other words opportunity cost of production).
300
What 3 questions must all economies answer?
WHAT products to produce, HOW to combine resources to produce them, WHO should get the production?
300
Name the 4 kinds of economic systems.
Market, Command, Traditional, Mixed
300
What are the LARGEST exports for: Nigeria and Brazil?
Nigeria = Oil
Brazil = Soy
300
Which economist developed the principle of Comparative Advantage?
David Ricardo
300
What's the opportunity cost of moving from point B to point A?
The amount of cotton given up, which is 100 units of cotton.
400
Economics is the study of ____________________________________________________________________________________ (phrase)
Resource allocation in an environment of scarcity, "the art of making the most out of life"
400
There is a tradeoff associated with a market vs. command economy that is referred to as the ________ vs. ____________ tradeoff. Both of these terms begin with the letter "E". What are the two terms and explain the tradeoff.
Efficiency vs. Equity tradeoff. A market economy is highly efficient but at the expense of equity (equal distribution of wealth), whereas a command economy trades off equity at the expense of efficiency.
400
Rank order the following countries from HIGHEST GDP PER CAPITA to LOWEST: Brazil, France, Singapore, North Korea
SINGAPORE = $106,000
FRANCE = $44,000
BRAZIL = $15,000
NORTH KOREA = $1,700
400
What's the island with a traditional economic system located in the Indian Ocean, where these island inhabitants remain "uncontacted"?
(North) Sentinel Island
400
How do you figure out the terms of trade?
You look at each producers' opportunity cost of producing one of the two items. Once you have done this you know the terms of trade has to be in this range.
500
Name the FOUR factors of production:
Land, Labor, Capital, Entrepreneurship
500
Describe 5 characteristics of a market economy.
Productive, efficient, freedom of choice, laissez faire, price mechanism, competition, innovation, unequal distribution of wealth, amoral, profit maximization of firms, pursuit of self interest, others are possible...
500
RANK order the LAND AREA of these 5 COUNTRIES from LARGEST TO SMALLEST : NEPAL, IRELAND, AUSTRALIA , CUBA, NORTH KOREA,
AUSTRALIA 7.7 MILLION SQ K = # 7 in world
NEPAL = # 96 IN WORLD = 143K SQ K.,
N. KOREA = # 100 IN WORLD = 120K SQ K.,
CUBA = #107 IN WORLD = 109K SQ K,
IRELAND = #121 IN WORLD 68K SQ K
500
In 2001 which energy company declared bankruptcy and caused the dissolution of Arthur Anderson Accounting?
Enron
500
Using the model of comparative advantage, which country should produce which product? Explain using opportunity cost.
England can produce 100 units of cloth OR 120 units of wine.
Portugal can produce 90 units of cloth OR 80 units of wine.
England should make wine and Portugal should make cloth. England's oc 1 wine = 5/6 cloth but Portugal has a higher oc of wine at 9/8 cloth. Portugal's OC 1 cloth = 8/9 wine, which is lower than England's OC at 6/5 wine.